1.1                          A bill for an act 
  1.2             relating to education; modifying special education 
  1.3             provisions; providing for rulemaking; amending 
  1.4             Minnesota Statutes 1998, sections 121A.43; 125A.03; 
  1.5             125A.09, subdivisions 6 and 8; 125A.10; 125A.18; 
  1.6             125A.24; and 125A.75, subdivision 8, and by adding a 
  1.7             subdivision. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 1998, section 121A.43, is 
  1.10  amended to read: 
  1.11     121A.43 [EXCLUSION AND EXPULSION OF PUPILS WITH A 
  1.12  DISABILITY.] 
  1.13     When a pupil who has an individual education plan is 
  1.14  excluded or expelled under sections 121A.40 to 121A.56 for 
  1.15  misbehavior that is not a manifestation of the pupil's 
  1.16  disability, the district shall continue to provide special 
  1.17  education and related services after a period of suspension, if 
  1.18  suspension is imposed.  The district shall initiate a review of 
  1.19  the individual education plan within five ten school days of 
  1.20  commencing an expulsion, exclusion, or a suspension.  
  1.21     Sec. 2.  Minnesota Statutes 1998, section 125A.03, is 
  1.22  amended to read: 
  1.23     125A.03 [SPECIAL INSTRUCTION FOR CHILDREN WITH A 
  1.24  DISABILITY.] 
  1.25     (a) As defined in paragraph (b), to the extent required in 
  1.26  federal law as of July 1, 1999, every district must provide 
  2.1   special instruction and services, either within the district or 
  2.2   in another district, for children with a disability who are 
  2.3   residents of the district and who are disabled as set forth in 
  2.4   section 125A.02. 
  2.5      (b) Notwithstanding any age limits in laws to the contrary, 
  2.6   special instruction and services must be provided from birth 
  2.7   until September 1 after the child with a disability becomes 22 
  2.8   21 years old but shall not extend beyond secondary school or its 
  2.9   equivalent, except as provided in section 124D.68, subdivision 
  2.10  2.  Local health, education, and social service agencies must 
  2.11  refer children under age five who are known to need or suspected 
  2.12  of needing special instruction and services to the school 
  2.13  district.  Districts with less than the minimum number of 
  2.14  eligible children with a disability as determined by the state 
  2.15  board must cooperate with other districts to maintain a full 
  2.16  range of programs for education and services for children with a 
  2.17  disability.  This section does not alter the compulsory 
  2.18  attendance requirements of section 120A.22. 
  2.19     Sec. 3.  Minnesota Statutes 1998, section 125A.09, 
  2.20  subdivision 6, is amended to read: 
  2.21     Subd. 6.  [IMPARTIAL DUE PROCESS HEARING.] Parents, 
  2.22  guardians, and the district must have an opportunity to obtain 
  2.23  an impartial due process hearing initiated and with respect to 
  2.24  any matter relating to the identification, evaluation, or 
  2.25  educational placement of the child, or the provision of a free 
  2.26  appropriate public education to such a child.  The hearing shall 
  2.27  be conducted by and in the district responsible for assuring 
  2.28  that an appropriate program is provided in accordance with state 
  2.29  board rules, if the parent or guardian continues to object to:  
  2.30     (1) a proposed formal educational assessment or proposed 
  2.31  denial of a formal educational assessment of their child; 
  2.32     (2) the proposed placement of their child in, or transfer 
  2.33  of their child to a special education program; 
  2.34     (3) the proposed denial of placement of their child in a 
  2.35  special education program or the transfer of their child from a 
  2.36  special education program; 
  3.1      (4) the proposed provision or addition of special education 
  3.2   services for their child; or 
  3.3      (5) the proposed denial or removal of special education 
  3.4   services for their child.  
  3.5      A hearing officer may limit an impartial due process 
  3.6   hearing to an amount of time sufficient for each party to 
  3.7   present its case.  The party requesting the hearing shall plead 
  3.8   with specificity as to what issues are in dispute and all issues 
  3.9   not pleaded with specificity are deemed waived.  Parties must 
  3.10  limit evidence to the issues specifically pleaded.  A hearing 
  3.11  officer, at the officer's discretion, may exclude cumulative 
  3.12  evidence or may encourage parties to present only essential 
  3.13  witnesses. 
  3.14     Within five business days after the request for a hearing, 
  3.15  or as directed by the hearing officer, the objecting party must 
  3.16  provide the other party with a brief written statement of 
  3.17  particulars of the objection, the reasons for the objection, and 
  3.18  the specific remedies sought.  The other party shall provide the 
  3.19  objecting party with a written response to the statement of 
  3.20  objections within five business days of receipt of the statement.
  3.21     The hearing must take place before an impartial hearing 
  3.22  officer mutually agreed to by the school board and the parent or 
  3.23  guardian.  Within four two business days of the receipt of the 
  3.24  request for the hearing, if the parties have not agreed on the 
  3.25  hearing officer, the board must request the commissioner to 
  3.26  appoint a hearing officer from a list maintained for that 
  3.27  purpose.  If the parties have not agreed upon a hearing officer, 
  3.28  and the board has not requested that a hearing officer be 
  3.29  appointed by the commissioner within three business days after 
  3.30  the receipt of the request, the commissioner shall appoint a 
  3.31  hearing officer upon the request of either party.  A retired 
  3.32  judge, retired court referee, or retired federal magistrate 
  3.33  judge who is otherwise qualified under this section and wishes 
  3.34  to be a hearing officer may be put on the list.  The board must 
  3.35  include with the request the name of the person requesting the 
  3.36  hearing, the name of the student, the attorneys involved, if 
  4.1   any, and the date the hearing request was received.  The hearing 
  4.2   officer must not be a board member or employee of the district 
  4.3   where the child resides or of the child's district of residence, 
  4.4   an employee of any other public agency involved in the education 
  4.5   or care of the child, or any person with a personal or 
  4.6   professional interest that would conflict with the person's 
  4.7   objectivity at the hearing.  A person who otherwise qualifies as 
  4.8   a hearing officer is not an employee of the district solely 
  4.9   because the person is paid by the district to serve as a hearing 
  4.10  officer.  Any party to a hearing, except an expedited hearing 
  4.11  under federal law, may make and serve upon the opposing party 
  4.12  and the commissioner a notice to remove a hearing officer 
  4.13  appointed by the commissioner.  The notice shall be served and 
  4.14  filed within two business days after the party receives notice 
  4.15  of the appointment of the hearing officer by the commissioner. 
  4.16     No such notice may be filed by a party against a hearing 
  4.17  officer who has presided at a motion or any other proceeding of 
  4.18  which the party had notice.  A hearing officer who has presided 
  4.19  at a motion or other proceeding may not be removed except upon 
  4.20  an affirmative showing of prejudice on the part of the hearing 
  4.21  officer.  
  4.22     After the party has once disqualified a hearing officer as 
  4.23  a matter of right, that party may disqualify the substitute 
  4.24  hearing officer only by making an affirmative showing of 
  4.25  prejudice or bias to the commissioner, or to the chief 
  4.26  administrative law judge if the hearing officer is an 
  4.27  administrative law judge. 
  4.28     Upon the filing of a notice to remove or if a party makes 
  4.29  an affirmative showing of prejudice against a substitute hearing 
  4.30  officer, the commissioner shall assign any other hearing officer 
  4.31  to hear the matter. 
  4.32     If the hearing officer requests an independent educational 
  4.33  assessment of a child, the cost of the assessment must be at 
  4.34  district expense.  The proceedings must be recorded and 
  4.35  preserved, at the expense of the school district, pending 
  4.36  ultimate disposition of the action. 
  5.1      Sec. 4.  Minnesota Statutes 1998, section 125A.09, 
  5.2   subdivision 8, is amended to read: 
  5.3      Subd. 8.  [COMPENSATORY EDUCATIONAL SERVICES.] The hearing 
  5.4   officer may require the resident school district to provide 
  5.5   compensatory educational services to the child if the hearing 
  5.6   officer finds that the school district has not offered or made 
  5.7   available to the child a free appropriate public education in 
  5.8   the child's educational program and that the child has suffered 
  5.9   a loss of educational benefit.  Such services shall take the 
  5.10  form of direct and indirect special education and related 
  5.11  services designed to address any loss of educational benefit 
  5.12  that may have occurred.  The hearing officer's finding shall be 
  5.13  based on a present determination of whether the child has 
  5.14  suffered a loss of educational benefit.  Where a student has not 
  5.15  received services as outlined on the student's individual 
  5.16  educational plan, there exists a presumption of a loss of 
  5.17  educational benefit. 
  5.18     Sec. 5.  Minnesota Statutes 1998, section 125A.10, is 
  5.19  amended to read: 
  5.20     125A.10 [COORDINATING INTERAGENCY SERVICES.] 
  5.21     If at the time of initial referral for an educational 
  5.22  assessment, or a reassessment, the district determines that a 
  5.23  child with disabilities who is age 3 through 21 may be eligible 
  5.24  for interagency services, the district may request that the 
  5.25  county of residence provide a representative to the initial 
  5.26  assessment or reassessment team meeting or the first individual 
  5.27  education plan team meeting following the assessment or 
  5.28  reassessment.  The district may request to have a county 
  5.29  representative attend other individual education plan team 
  5.30  meetings when it is necessary to facilitate coordination between 
  5.31  district and county provided services.  Upon request from a 
  5.32  district, the resident county shall provide a representative to 
  5.33  assist the individual education plan team in determining the 
  5.34  child's eligibility for existing health, mental health, or other 
  5.35  support services administered or provided by the county.  The 
  5.36  individual education plan team and the county representative 
  6.1   must develop an interagency plan of care for an eligible child 
  6.2   and the child's family to coordinate services required under the 
  6.3   child's individual education plan with county services.  The 
  6.4   interagency plan of care must include appropriate family 
  6.5   information with the consent of the family, a description of how 
  6.6   services will be coordinated between the district and county, a 
  6.7   description of service coordinator responsibilities and 
  6.8   services, and a description of activities for obtaining 
  6.9   third-party payment for eligible services, including medical 
  6.10  assistance payments.  Any state, county, or city government 
  6.11  agency responsible for providing services or resources to 
  6.12  students with disabilities under this section is subject to the 
  6.13  same dispute resolution systems as local school districts, and 
  6.14  all such agencies must comply with corrective action 
  6.15  requirements that ensue from these systems. 
  6.16     Sec. 6.  Minnesota Statutes 1998, section 125A.18, is 
  6.17  amended to read: 
  6.18     125A.18 [SPECIAL INSTRUCTION; NONPUBLIC SCHOOLS.] 
  6.19     No resident of a district who is eligible for special 
  6.20  instruction and services under this section may be denied 
  6.21  instruction and service on a shared time basis consistent with 
  6.22  section 126C.19, subdivision 4, because of attending a nonpublic 
  6.23  school defined in section 123B.41, subdivision 9.  If a resident 
  6.24  pupil with a disability attends a nonpublic school located 
  6.25  within the district of residence, the district must provide 
  6.26  necessary transportation for that pupil within the district 
  6.27  between the nonpublic school and the educational facility where 
  6.28  special instruction and services are provided on a shared time 
  6.29  basis.  If a resident pupil with a disability attends a 
  6.30  nonpublic school located in another district and if no agreement 
  6.31  exists under section 126C.19, subdivision 1 or 2, for providing 
  6.32  special instruction and services on a shared time basis to that 
  6.33  pupil by the district of attendance and where the special 
  6.34  instruction and services are provided within the district of 
  6.35  residence, the district of residence must provide necessary 
  6.36  transportation for that pupil between the boundary of the 
  7.1   district of residence and the educational facility.  The 
  7.2   district of residence may provide necessary transportation for 
  7.3   that pupil between its boundary and the nonpublic school 
  7.4   attended, but the nonpublic school must pay the cost of 
  7.5   transportation provided outside the district boundary.  
  7.6      Parties serving students on a shared time basis have access 
  7.7   to due process hearing system described under United States 
  7.8   Code, title 20, and the complaint system under Code of Federal 
  7.9   Regulations, title 34, section 300.660-662.  In the event it is 
  7.10  determined under these systems that the nonpublic school or 
  7.11  staff impeded the public school district's provision of a free 
  7.12  appropriate education, the commissioner may withhold public 
  7.13  funds available to the nonpublic school under section 123B.42. 
  7.14     Sec. 7.  Minnesota Statutes 1998, section 125A.24, is 
  7.15  amended to read: 
  7.16     125A.24 [PARENT ADVISORY COMMITTEES.] 
  7.17     Provisions of Minnesota Rules, part 3525.1100, regarding 
  7.18  parent advisory committees apply to local boards or cooperative 
  7.19  boards carrying out the provisions of this section.  In order to 
  7.20  increase the involvement of parents of children with 
  7.21  disabilities in district policy-making and decision-making, 
  7.22  school districts must have a special education advisory council 
  7.23  that is incorporated into the district's special education 
  7.24  system plan. 
  7.25     (1) This advisory council may be established either for 
  7.26  individual districts or in cooperation with other districts who 
  7.27  are members of the same special education cooperative. 
  7.28     (2) A district may set up this council as a subgroup of an 
  7.29  existing board, council, or committee. 
  7.30     (3) At least half of the designated council members must be 
  7.31  parents of students with a disability.  The number of members, 
  7.32  frequency of meetings, and operational procedures are to be 
  7.33  locally determined. 
  7.34     (4) The purpose of the council is to advise the local 
  7.35  school board or comparable governance board for a cooperative. 
  7.36     (5) The council must meet on at least an annual basis and 
  8.1   submit its recommendations, if any, to its governing board. 
  8.2      Sec. 8.  Minnesota Statutes 1998, section 125A.75, 
  8.3   subdivision 8, is amended to read: 
  8.4      Subd. 8.  [LITIGATION AND HEARING COSTS.] (a) For fiscal 
  8.5   year 1999 and thereafter, the commissioner of children, 
  8.6   families, and learning, or the commissioner's designee, shall 
  8.7   use state funds to pay school districts for the administrative 
  8.8   costs of a due process hearing incurred under section 125A.09, 
  8.9   subdivisions 6, 10, and 11, including hearing officer fees, 
  8.10  court reporter fees, mileage costs, transcript costs, 
  8.11  independent evaluations ordered by the hearing officer, and 
  8.12  rental of hearing rooms, but not including district attorney 
  8.13  fees.  To receive state aid under this paragraph, a school 
  8.14  district shall submit to the commissioner at the end of the 
  8.15  school year an itemized list of unreimbursed actual costs for 
  8.16  fees and other expenses under this paragraph.  State funds used 
  8.17  for aid to school districts under this paragraph shall be based 
  8.18  on the unreimbursed actual costs and fees submitted by a 
  8.19  district from previous school years. 
  8.20     (b) For fiscal year 1999 and thereafter, a school district, 
  8.21  to the extent to which it prevails under United States Code, 
  8.22  title 20, section 1415(i)(3)(B)(D) and Rule 68 of the Federal 
  8.23  Rules of Civil Procedure, shall receive state aid equal to 50 
  8.24  percent of the total actual cost of attorney fees, not to exceed 
  8.25  $10,000 per case, incurred after a request for a due process 
  8.26  hearing under section 125A.09, subdivisions 6, 9, and 11, is 
  8.27  served upon the parties.  A district is eligible for 
  8.28  reimbursement for attorney fees under this paragraph only if: 
  8.29     (1) a court of competent jurisdiction determines that the 
  8.30  parent is not the prevailing party under United States Code, 
  8.31  title 20, section 1415(i)(3)(B)(D), or the parties stipulate 
  8.32  that the parent is not the prevailing party; 
  8.33     (2) the district has made a good faith effort to resolve 
  8.34  the dispute through mediation, but the obligation to mediate 
  8.35  does not compel the district to agree to a proposal or make a 
  8.36  concession; and 
  9.1      (3) the district made an offer of settlement under Rule 68 
  9.2   of the Federal Rules of Civil Procedure.  
  9.3      To receive aid, a school district that meets the criteria 
  9.4   of this paragraph shall submit to the commissioner at the end of 
  9.5   the school year an itemized list of unreimbursed actual attorney 
  9.6   fees associated with a due process hearing under section 
  9.7   125A.09, subdivisions 6, 9, and 11.  Aid under this paragraph 
  9.8   for each school district is based on unreimbursed actual 
  9.9   attorney fees submitted by the district from previous school 
  9.10  years. 
  9.11     (c) For fiscal year 1999 and thereafter, a school district 
  9.12  is eligible to receive state aid for 50 percent of the total 
  9.13  actual cost of attorney fees, not to exceed $20,000 per case, it 
  9.14  incurs in appealing to a court of competent jurisdiction the 
  9.15  findings, conclusions, and order of a due process hearing under 
  9.16  section 125A.09, subdivisions 6, 9, and 11.  The district is 
  9.17  eligible for reimbursement under this paragraph only if the 
  9.18  commissioner authorizes the reimbursement after evaluating the 
  9.19  merits of the case.  In a case where the commissioner is a named 
  9.20  party in the litigation, the commissioner of the bureau of 
  9.21  mediation services shall make the determination regarding 
  9.22  reimbursement.  The commissioner's decision is final.  The 
  9.23  amount of state aid for these fees shall not exceed $20,000 per 
  9.24  case. 
  9.25     (d) The commissioner shall provide districts with a form on 
  9.26  which to annually report litigation costs under this section and 
  9.27  shall base aid estimates on those reports.  
  9.28     Sec. 9.  Minnesota Statutes 1998, section 125A.75, is 
  9.29  amended by adding a subdivision to read: 
  9.30     Subd. 9.  [LIMITATION OF FEES PAID BY PUBLIC FUNDS.] (a) A 
  9.31  fee for legal services of $20,000 is the maximum permissible fee 
  9.32  payable by a school district for a special education dispute 
  9.33  resulting in a hearing and appeal pursuant to section 125A.09, 
  9.34  subdivisions 6 and 9.  All fees related to the same case are 
  9.35  cumulative and may not exceed $20,000 in public funds, not 
  9.36  including attorney's fees paid as part of the costs to the 
 10.1   parents of a child with a disability who is the prevailing 
 10.2   party.  This limitation does not apply to legal fees incurred in 
 10.3   an appeal to a state or federal court of competent jurisdiction. 
 10.4      (b) An attorney who is claiming legal fees for representing 
 10.5   a school district in a special education matter shall file a 
 10.6   statement of attorney fees with the independent hearing officer 
 10.7   and hearing review officer before whom the matter was heard.  A 
 10.8   copy of a signed retainer shall also be filed.  The school 
 10.9   district and any insurer shall receive a copy of the statement.  
 10.10  The statement shall be on a form developed by the commissioner 
 10.11  and shall report the number of hours spent on the case. 
 10.12     (c) Each school district seeking reimbursement in state aid 
 10.13  under subdivision 8 shall file annual statements with the 
 10.14  commissioner detailing the total amount of legal fees and other 
 10.15  legal costs incurred by the school district for special 
 10.16  education disputes during the year.  The statement shall include 
 10.17  the amounts paid for outside and in-house counsel, deposition 
 10.18  and other witness fees, and all other costs relating to 
 10.19  litigation. 
 10.20     (d) An attorney who is hired by a school district to 
 10.21  provide legal services with respect to a special education 
 10.22  dispute shall prepare a retainer agreement in which the 
 10.23  provisions of this section are specifically set out and provide 
 10.24  a copy of this agreement to the school district.  The retainer 
 10.25  agreement shall provide for the signature of an authorized 
 10.26  representative of the school district.  No fee shall be paid in 
 10.27  the absence of a signed retainer agreement.  The retainer 
 10.28  agreement shall contain a notice to the school district 
 10.29  regarding the maximum fee allowed under this section in no 
 10.30  smaller than ten-point type, which shall read: 
 10.31                      Notice of Maximum Fee 
 10.32     The maximum fee allowed by law for legal services for 
 10.33     special education disputes resulting in a hearing or appeal 
 10.34     pursuant to Minnesota Statutes, section 125A.09, 
 10.35     subdivisions 6 and 9, is $20,000.  The school district 
 10.36     shall take notice that the school district is under no 
 11.1      legal or moral obligation to pay any fee for legal services 
 11.2      in excess of the foregoing maximum fee. 
 11.3      (e) An attorney who knowingly violates any provisions of 
 11.4   this subdivision with respect to authorized fees for legal 
 11.5   services in connection with any demand made or suit or 
 11.6   processing made under the provision of this subdivision is 
 11.7   guilty of a gross misdemeanor. 
 11.8      (f) Attorney fees and other disbursements for a proceeding 
 11.9   under this subdivision shall not be due or paid until the issue 
 11.10  for which the fee or disbursement was incurred has been resolved.
 11.11     Sec. 10.  [SPECIAL EDUCATION RULES.] 
 11.12     The commissioner shall adopt rules to update Minnesota 
 11.13  Rules, chapter 3525, for special education.  Provisions of this 
 11.14  chapter that exceed federal requirements are deemed valid for 
 11.15  the purposes of providing special instruction and services to 
 11.16  children with a disability.  In addition to technical changes, 
 11.17  corrections, clarifications, and similarly needed revisions, 
 11.18  specific rules shall be modified or repealed as indicated below: 
 11.19     (1) to Minnesota Rules, part 3525.0200, add definition of 
 11.20  caseload; 
 11.21     (2) revise Minnesota Rules, part 3525.0550, to update role 
 11.22  of IEP manager; 
 11.23     (3) repeal Minnesota Rules, part 3525.1100, subpart 2, item 
 11.24  D, on parent advisory council as duplicative; 
 11.25     (4) to Minnesota Rules, part 3525.1329, amend eligibility 
 11.26  criteria for emotional or behavior disorders so that the 
 11.27  standards reflect a more severe emotional disorder; 
 11.28     (5) repeal Minnesota Rules, part 3525.2470, on suspension, 
 11.29  exclusion, and expulsion as duplicative; 
 11.30     (6) repeal Minnesota Rules, part 3525.2550, on conduct 
 11.31  before assessment except for subpart 2, item C; 
 11.32     (7) add a rule to clarify the responsibilities of the IEP 
 11.33  team for assessment, IEP development, and placement decisions; 
 11.34     (8) repeal Minnesota Rules, part 3525.2750, on educational 
 11.35  assessment as duplicative; 
 11.36     (9) repeal Minnesota Rules, part 3525.2900, on IEP 
 12.1   development and content except for subpart 5 on regulated 
 12.2   interventions; 
 12.3      (10) repeal Minnesota Rules, part 3525.3300, except item B, 
 12.4   on contents of notice as duplicative; and 
 12.5      (11) amend Minnesota Rules, part 3525.3700, regarding 
 12.6   district mandate for conciliation so it is consistent with 
 12.7   legislation.