465.715 Political subdivisions; lease purchase agreements; corporations.
Subdivision 1. Statutory authorization required. A county, home rule charter city, statutory city, town, school district, or other political subdivision may not create a corporation, whether for profit or not for profit, unless explicitly authorized to do so by law.
Subd. 1a. Application. Except as provided by subdivision 2, subdivision 1 only applies to a corporation for which a certificate of incorporation is issued by the secretary of state on or after June 1, 1997. A corporation that had been issued a certificate of incorporation before June 1, 1997, may continue to operate as if it had been created in compliance with subdivision 1. This subdivision expires July 1, 1999.
Subd. 2. Pre-December 1, 1996, lease purchase agreements. The validity of any lease purchase agreement entered into prior to December 1, 1996, and subsequent refinancings are not affected by either the amount of consideration paid by a lessor for an interest in real property or, in the case of lessors organized by or on behalf of the city, county, town, or school district, any defect in or lack of authority to organize such entity. A nonprofit corporation organized by or on behalf of a city, county, town, or school district, for the purpose of a lease purchase agreement, may continue in existence until the end of any lease agreement in effect on December 1, 1996, but thereafter is dissolved. During its existence, the nonprofit corporation shall conduct only business that is necessary and directly related to the lease agreement. The nonprofit corporation is a public corporation for purposes of section 465.035 and is subject to all laws as if it were a part of the city, county, town, or school district.
Subd. 3. Information. (a) By June 30, 1998, the office of the state auditor shall request from all counties, home rule charter cities, statutory cities, urban towns, and school districts information regarding all corporations, including limited liability companies or limited liability partnerships, whether for profit or not for profit, created by the political subdivision. The information requested must include information regarding the corporation's incorporation date, organizational structure, purpose, a brief summary of the extent to which the corporation receives or expends public funds, potential public liabilities for conduct of the corporation, public oversight, and public laws applicable to the corporation. This information must be received by the state auditor on or before October 15, 1998.
(b) The office of the state auditor shall compile and summarize the information received and report to the senate local and metropolitan government committee and the house of representatives local government and metropolitan affairs committee or their successor committees by January 30, 1999. The report may include recommendations for any changes in laws governing the operation of existing and future corporate entities created by such political subdivisions, and changes in laws needed to clarify the legal status of these corporate entities. Any corporate entity created by a political subdivision before September 1, 1998, for which a report is not received by the state auditor is not authorized to receive public funds or contract with public entities after July 1, 1999.
Official Publication of the State of Minnesota
Revisor of Statutes