1.1 	A bill for an act
1.2 	relating to local government; providing for local
1.3 	governments to opt out of state mandates; proposing
1.4 	coding for new law as Minnesota Statutes, chapter 471B.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. [471B.01] DEFINITIONS.
1.7 		Subdivision 1.Scope. For the purposes of this chapter,
1.8 	the terms defined in this section have the meanings given them.
1.9 		Subd. 2.Local government. "Local government" means a
1.10 	county, town, school district, or statutory or home rule charter
1.11 	city.
1.12 		Subd. 3.Local government of the same kind. "Local
1.13 	government of the same kind" means any category of the
1.14 	following:  all cities, all counties, all school districts, or
1.15 	all towns.
1.16 		Subd. 4.Same class. "Same class" means all cities of
1.17 	the same class.
1.18 		Subd. 5.School district. "School district" means a
1.19 	common, independent, or special school district and excludes
1.20 	charter schools.
1.21 		Subd. 6.State mandate. "State mandate" means a state
1.22 	law or rule specifically directed at or related to local
1.23 	government structure, operation, services, programs, or
1.24 	financing that:
1.25 	(1) imposes a cost on a local government, whether or not
2.1 	the state appropriates money for the local government to cover
2.2 	the costs, or authorizes the local government to impose a tax or
2.3 	fee to cover the costs;
2.4 	(2) decreases revenue available to a local government
2.5 	without a commensurate decrease in services and programs
2.6 	required by the law or rule;
2.7 	(3) makes a local government, or its officers or employees,
2.8 	civilly or criminally liable for failure to follow or enforce
2.9 	the law or rule;
2.10 	(4) restricts the ability of a local government to
2.11 	establish services, programs, policies, plans, or goals, or
2.12 	restricts its ability to raise revenue or finance its services,
2.13 	programs, policies, plans, or goals; or 
2.14 	(5) implements or interprets federal law and, by its
2.15 	implementation or interpretation, increases or decreases program
2.16 	or service or funding levels.

2.17 	Sec. 2. [471B.02] OPT OUT RESOLUTION AND PROCEDURES.
2.18 		Subdivision 1.Local procedure. (a) A local government
2.19 	may, by written resolution of the governing body after public
2.20 	notice and hearing, propose that a state mandate imposed on all
2.21 	local governments of the same kind or class, except a state
2.22 	mandate under section 471B.03, should not apply to it.  A local
2.23 	government also may include in a resolution recommendations for
2.24 	reforming a mandate.  A local government must adopt a separate
2.25 	resolution for each mandate that it proposes should not apply to
2.26 	it.  The resolution must:
2.27 	(1) specifically cite the state law or rule that imposes
2.28 	the mandate on the local government;
2.29 	(2) identify any costs of complying with the mandate and
2.30 	the total amount of federal and state funds available for
2.31 	complying with the mandate;
2.32 	(3) state the reasons the local government needs to opt out
2.33 	of the state mandate and recommend mandate reforms to achieve
2.34 	greater efficiencies; and 
2.35 	(4) indicate how the local government will otherwise meet
2.36 	the objectives of the mandate or why the objectives do not apply
3.1 	to the local government.
3.2 	(b) Before voting on the resolution, the governing body
3.3 	must give adequate public notice of the proposed resolution,
3.4 	including information on whether state or federal funding for
3.5 	the local government might be adversely affected.  The governing
3.6 	body must hold at least one public hearing on the proposed
3.7 	resolution and afford the public opportunity for comment.  The
3.8 	governing body must encourage public participation in the
3.9 	hearing in order to determine the extent of public support for
3.10 	the proposed resolution.
3.11 	(c) The proponent of the proposed resolution at least must
3.12 	identify at the hearing:
3.13 	(1) the costs of complying with the mandate that exceed the
3.14 	state and federal funds allocated to the district for purposes
3.15 	of the mandate and recommend reforms for achieving greater
3.16 	efficiencies;
3.17 	(2) any potential loss of state or federal revenue that
3.18 	might result from opting out of the state mandate;
3.19 	(3) other policy issues or effects that might result;
3.20 	(4) the purposes for which the mandate was imposed;
3.21 	(5) those persons and categories of person who will be
3.22 	adversely affected if the mandate is not complied with; and 
3.23 	(6) the costs and benefits of the mandate compared to the
3.24 	costs and benefits of inaction.
3.25 	(d) A local government that adopts a resolution must file
3.26 	the resolution with the state auditor.  At the time of filing,
3.27 	the local government must pay the state auditor a fee to cover
3.28 	actual costs the state auditor incurs in performing the duties
3.29 	under this section.  The amount of the fee is as follows:
3.30 	(1) for each resolution filed by a local government with a
3.31 	population over 100,000, $500;
3.32 	(2) for each resolution filed by a local government with a
3.33 	population over 20,000 and not more than 100,000, $350;
3.34 	(3) for each resolution filed by a local government with a
3.35 	population over 10,000 and not more than 20,000, $200; and 
3.36 	(4) for each resolution filed by a local government with a
4.1 	population of not more than 10,000, $50.
4.2 	All fees collected under this section are appropriated to the
4.3 	state auditor for the purposes of this section.  On July 1,
4.4 	2005, and each July 1 thereafter, using the powers granted under
4.5 	chapter 6, the auditor must determine the actual cost of
4.6 	performing the duties under this section and adjust the amount
4.7 	of the fee to reflect the auditor's actual costs.
4.8 		Subd. 2.State procedure. (a) The state auditor must:
4.9 	(1) list on the state auditor's Web site all state mandates
4.10 	cited in a resolution filed with the state auditor, identifying
4.11 	for each mandate the local governments that adopted and filed a
4.12 	resolution to opt out of a mandate, and whether the threshold
4.13 	under subdivision 3 for opting out is met;
4.14 	(2) keep a running total of the number and percent of local
4.15 	governments of the same kind and, if applicable, same class,
4.16 	that have filed a resolution to opt out;
4.17 	(3) notify the legislature when the threshold under
4.18 	subdivision 3 for opting out is met; and 
4.19 	(4) each year before the Minnesota Statutes or Minnesota
4.20 	Statutes Supplement is published, at a time determined by the
4.21 	revisor of statutes, provide to the revisor of statutes and the
4.22 	local governments that filed resolutions to opt out of a mandate
4.23 	a list of all laws and rules from which local governments may
4.24 	opt out, consistent with legislative action under subdivision 3.
4.25 	(b) The revisor of statutes must:
4.26 	(1) publish a list of the affected laws, rules, and local
4.27 	governments; and 
4.28 	(2) provide appropriate means, including cross-references,
4.29 	for the public reasonably to use the statutes and rules in the
4.30 	context of the list in clause (1).
4.31 		Subd. 3.Threshold and certification for opting out;
4.32 	legislative oversight. (a) The state auditor must notify the
4.33 	house of representatives and senate when the auditor certifies
4.34 	that the minimum number of local governments of the same kind,
4.35 	and, if applicable, same class, file resolutions under the
4.36 	requirements of this chapter.  The minimum number is set in
5.1 	paragraph (c).  The legislature must consider the opt out
5.2 	resolutions included in a notice the auditor delivered to the
5.3 	legislature before the regular session convenes in any year.
5.4 	The resolutions are accepted for implementation if approved by
5.5 	the legislature under this subdivision.
5.6 	(b) The house of representatives and senate must adopt
5.7 	rules ensuring that bills to forbid implementing of the
5.8 	resolutions or amending the mandates to which they refer are
5.9 	given a priority status and presented to the house and senate
5.10 	for consideration and action by that body in a timely manner
5.11 	during the regular session that year.
5.12 	(c) The minimum number of local governments of the same
5.13 	kind or class are:
5.14 	(1) six counties;
5.15 	(2) ... cities, if all cities;
5.16 	(3) ... home rule charter cities;
5.17 	(4) ... statutory cities;
5.18 	(5) two cities of the first class;
5.19 	(6) 14 cities of the second class;
5.20 	(7) 11 cities of the third class;
5.21 	(8) 38 cities of the fourth class;
5.22 	(9) 45 towns; and 
5.23 	(10) 24 school districts.
5.24 		Subd. 4.Opt out implementation and later opting
5.25 	out. After initial opt out resolutions are approved by the
5.26 	legislature and take effect, other local governments of the same
5.27 	kind and, if applicable, same class, may file resolutions to opt
5.28 	out of the same mandate.  The later-filed resolutions must be
5.29 	consistent with the law enacted in response to the initial opt
5.30 	out resolutions and later-filed resolutions are only effective
5.31 	to the extent authorized by that law.  Each of these takes
5.32 	effect 30 days after the auditor accepts the filing.

5.33 	Sec. 3. [471B.03] EXCEPTIONS.
5.34 		Subdivision 1.Scope. The state laws listed in this
5.35 	section are not subject to section 471B.02 and the state auditor
5.36 	must not accept resolutions to address concerns related to these
6.1 	laws.
6.2 		Subd. 2.Election law. A local government may not opt
6.3 	out of Minnesota election law, as defined in section 200.01, and
6.4 	any other law governing elections.
6.5 		Subd. 3.Property tax laws. A local government may not
6.6 	opt out of any laws related to the property tax system under
6.7 	chapters 270, 272, 273, 274, 275, 276, 276A, 277, 278, and 473F,
6.8 	and any other property tax-related provisions in law.
6.9 		Subd. 4.Accounting, financial management procedures;
6.10 	audit requirements. A local government may not opt out of any
6.11 	law governing the accounting, financial management, and audit
6.12 	requirements of local governments, including for school
6.13 	districts, the accounting, expenditures, and budgeting required
6.14 	under sections 123B.76 and 123B.77.  However, a school district
6.15 	may opt out of a state-mandated account or fund restriction
6.16 	consistent with the requirements of this section.
6.17 		Subd. 5.Nonpublic students. A school district may not
6.18 	opt out of sections 123B.40 to 123B.48 governing the rights of
6.19 	nonpublic school students and other law related to nonpublic
6.20 	schools or students.
6.21 		Subd. 6.State auditor. A local government may not opt
6.22 	out of any provision of chapter 6 or any other law that gives
6.23 	the state auditor authority to require or receive information
6.24 	from a local government.