1.1                          A bill for an act 
  1.2             relating to state government; adding circumstances 
  1.3             under which collection entity costs may be canceled; 
  1.4             amending Minnesota Statutes 2000, section 16D.11, 
  1.5             subdivision 3. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2000, section 16D.11, 
  1.8   subdivision 3, is amended to read: 
  1.9      Subd. 3.  [CANCELLATION.] (a) Collection costs imposed 
  1.10  under subdivision 1 shall be canceled and subtracted from the 
  1.11  amount due if: 
  1.12     (1) the debtor's household income as defined in section 
  1.13  290A.03, subdivision 5, excluding the exemption subtractions in 
  1.14  subdivision 3, paragraph (3) of that section, for the 12 months 
  1.15  preceding the date of referral is less than twice the annual 
  1.16  federal poverty guideline under United States Code, title 42, 
  1.17  section 9902, subsection (2); 
  1.18     (2) within 60 days after the first contact with the debtor 
  1.19  by the enterprise or collection agency, the debtor establishes 
  1.20  reasonable cause for the failure to pay the debt prior to 
  1.21  referral of the debt to the enterprise; 
  1.22     (3) a good faith dispute as to the legitimacy or the amount 
  1.23  of the debt is made, and payment is remitted or a payment 
  1.24  agreement is entered into within 30 days after resolution of the 
  1.25  dispute; 
  2.1      (4) good faith litigation occurs and the debtor's position 
  2.2   is substantially justified, and if the debtor does not totally 
  2.3   prevail, the debt is paid or a payment agreement is entered into 
  2.4   within 30 days after the judgment becomes final and 
  2.5   nonappealable; or 
  2.6      (5) collection costs have been added by the referring 
  2.7   agency and are included in the amount of the referred debt. 
  2.8      (b) In addition to cancellation of collection costs 
  2.9   required under paragraph (a), the commissioner may cancel 
  2.10  collection costs imposed under subdivision 1 if the commissioner 
  2.11  determines cancellation would be appropriate in the interest of 
  2.12  fairness.  A decision of the commissioner under this paragraph 
  2.13  is not subject to appeal under subdivision 4.