Article 1 - State Government Appropriations

Section 1.        State Government Appropriations

Section 2.        Legislature

Section 3.        Governor and Lieutenant Governor

Section  4.       State Auditor

Section 5.        Attorney General

Section 6.        Secretary of State

Section 7.        Campaign Finance and Public Disclosure Board

Section 8.        Investment Board

Section 9.        Administration Hearings

Section 10.      Office of Enterprise Technology

Section 11.      Administration.

Section 12.      Capitol Area Architectural and Planning Board

Section 13.      Minnesota Management and Budget

Section 14.      Revenue

Section 15.      Gambling Control

Section 16.      Racing Commission

Section 17.      State Lottery

Section 18.      Amateur Sports Commission

Section 19.      Council on Black Minnesotans

Section 20.      Council on Asian-Pacific Minnesotans

Section 21.      Council on Affairs of Chicano/Latino People

Section 22.      Indian Affairs Council

Section 23.      Minnesota Historical Society

Section 24.      Board of the Arts

Section 25.      Minnesota Humanities Center

Section 26.      Board of Accountancy

Section 27.      Board of Architecture, Engineering, Land Surveying, Landscape Architecture, Geoscience, and Interior Design

Section 28.      Board of Cosmetologist Examiners

Section 29.      Board of Barber Examiners

Section 30.      General Contingent Accounts

Section 31.      Tort Claims

Section 32.      Minnesota State Retirement System

Section 33.      Minneapolis Employees Retirement Fund Division Account

Section 34.      Teachers Retirement Association

Section 35.      St. Paul Teachers Retirement Fund

Section 36.      Duluth Teachers Retirement Fund

Section 37.      Military Affairs

Section 38.      Veterans Affairs

Article 2 - Minnesota Sunset Act

This article repeals the Minnesota Sunset Act and makes conforming changes.

Article 3 - State Government Operations

Section 1 [Authority to Accept Funds] authorizes the Secretary of State to solicit and accept funds from local governmental units to be used for technology projects to enhance the state's election system and allows the Secretary of State to accept federal funds for election purposes.  This section specifies that a certain state statute that governs the disbursement of federal funds will or will not apply, depending on whether the terms of the grant require the state to maintain its efforts.   Funds accepted under this section are deposited into a special revenue fund and are appropriated to the Secretary of State.  The Secretary of State is required to report by January 15 each year to the chair and ranking minority members of the finance committees of the house and senate.  The report must include the total amounts received in the preceding year, the source of those funds, and the uses to which those funds are put.

Section 2 [Authority to Accept Funds] authorizes the Secretary of State to solicit and accept funds from individuals and may apply for grants from charitable foundations and the federal government to be used for the confidentiality program, Safe at Home, that provides data protection for victims of violence.  This section specifies that a certain state statute that governs the disbursement of federal funds will or will not apply, depending on whether the terms of the grant require the state to maintain its efforts.   Funds accepted under this section are deposited into a special revenue fund and are appropriated to the Secretary of State.  The Secretary of State is required to report by January 15 each year to the chair and ranking minority members of the finance committees of the house and senate.  The report must include the total amounts received in the preceding year, the source of those funds, and the uses to which those funds are put.

Section 3 [City and Town Accounting System Software] permits the State Auditor to charge a onetime user fee to cities, towns, and other government entities for the development, maintenance, and distribution of the small city and town accounting system software.  The State Auditor shall consult with specified groups to set the amount of the fee.  A city and town accounting system (CTAS) account is established in the special revenue fund.  The onetime fee charged in this section shall be credited to the CTAS account and appropriated to the State Auditor for all costs associated with the development, maintenance, and distribution of the CTAS software.  If the CTAS software ceases to be offered by the State Auditor, any amount remaining in the CTAS account shall be equitably refunded to users and the account shall be closed.  The State Auditor shall consult with specified groups to set the amount of the refund.

Section 4 [Business as Vendor] changes when data submitted by a business to a government entity in response to a request for bids and proposals ceases to be private or nonpublic.  Under current law, the data is private or nonpublic until the bids or responses are opened; this section makes the data public at the time and date specified in the solicitation that bids or proposals are due.

This section changes what data remains private or nonpublic when all responses for bids or proposals are rejected prior to completion of the selection process.  Under current law, all data except that made public at the bid or response opening remain private or nonpublic; as changed by this section, all data, other than the name of the bidder and the dollar amount specified in the bid or response, remain private and nonpublic.

Section 5 [Resident Vendor] narrows the definition of “resident vendor” eligible for a preference over nonresident vendors from states that gives a preference to vendors from that state.  This preference applies to contracts for goods and services.  Under current law, to be a resident vendor, a person, firm, or corporation must be authorized to conduct business in the state, and includes foreign corporations authorized to engage in business in Minnesota.  This section adds the following criteria to be a resident vendor: 

• paid unemployment taxes or income taxes in Minnesota during the 12 calendar months immediately preceding submission of the bid or proposal;
• a business address in Minnesota; and
• affirmatively claim resident vendor status  in the bid or proposal.

Section 6 [Solicitation Process] changes when formal responses to a solicitation for goods, service contracts, and utilities is made public.  Under current law, all formal responses are opened in public at the hour stated in the solicitation; as changed in this section, the responses will be made publicly available as required by the Data Practices Act.

Section 7 [Procedure for Service Contracts] restricts the requirement that the Commissioner of Administration make certain determinations (e.g. that no current state employee is able and available to perform the services called for by the contract) before entering into a service contract.  Under current law, the commissioner must make the determination for every contract.  This section limits the requirement so that the commissioner must make the determination for contracts in excess of $5,000. 

Section 8 [Expenditures Under Specified Amounts] raises the threshold amount, from $2500 to $5000, above which the acquisition of goods or services, other than professional or technical services, must follow the solicitation process in current law.

Section 9 [Nonvisual Technology Access Standards] exempts agencies from a requirement to include nonvisual technology access standards in contracts for procurement of information technology.

Section 10 [Solicitation of Qualifications or Proposals] allows certain notices to be advertised in a manner designated by the commissioner.  Current law requires these notices to be advertised in the State Register.  This change applies to notices of requests for qualifications or proposals for design-build contracts with state agencies.

Section 11 [Solicitation of Qualifications] allows certain notices to be advertised in a manner designated by the commissioner.  Current law requires these notices to be advertised in the State Register.  This change applies to notices of requests for qualifications or proposals for construction-manager-at-risk contracts with state agencies.

Section 12 [State Agency Technology Projects] requires state agencies to determine the IT cost of information and telecommunication projects and enter into a service-level agreement with the Office of Enterprise Technology (OET) for the IT cost portion of the project, unless the commissioner of the OET determines that an agreement is not required.

Section 13 [Private Entity Services; Fee Authority] permits the Office of Enterprise Technology to enter into a contract with a private entity to manage, maintain, support, and expand North Star and online government information services to citizens and businesses.  The contract may provide for compensation of the private entity through a fee established by the OET.  The Office may charge, and may authorize a private entity that enters into a contract to provide information services to citizens and businesses to charge, a fee of up to $2 per transaction, provided that no fee can be charged for viewing and inspecting data.  In setting the fee, the Office shall consider the recommendation of the E-Government Advisory Council established later in the bill.  This fee is in addition to any fees or surcharges authorized under other law.

Receipts from the convenience fee shall be deposited in the North Star account. This section appropriates the receipts credited to the North Star account to OET for payment to the contracted private entity.  In lieu of depositing the receipts in the North Star account, the office is permitted to directly transfer the receipts to the private entity or allow the private entity to retain the receipts pursuant to a contract.

OET is required to report to the Legislature by January 15 of each odd-numbered year regarding the convenience fee receipts and the status of North Star projects and online government information services developed and supported by convenience fee receipts.

Section 14 [E-Government Advisory Council]

Subdivision 1 [E-Government Advisory Council established] establishes the E-Government Advisory Council to improve online government information services to citizens and businesses.

Subdivision 2 [Membership] sets the membership of the Council.  The Council will have nine members, including the State Information Officer or a designee, one public member appointed by the House and one public member appointed by the Senate, and six members appointed by the Governor that are actively involved with private businesses, the private business community or the public.

Subdivision 3 [Initial appointments and first meeting] sets a deadline for first appointments and establishes a rotation schedule for the initial appointees.  This section requires the Chief Information Officer (CIO) to convene the first meeting by November 1, 2013, and designates the CIO to act as chair at the first meeting.

Subdivision 4 [Terms; removal; vacancies; compensation] applies provisions for terms, removal, vacancies and compensation, in current law for advisory councils.

Subdivision 5 [Chair] requires the council to elect a chair annually from its membership. 

Subdivision 6 [Duties] describes the duties of the council to make certain recommendations regarding a convenience fee to OET.

Subdivision 7 [Staff] requires OET to provide staff to the council.

Subdivision 8 [Sunset] sunsets the council on the first Monday in January 2017.

Subdivision 9 [Reports] requires the council to report to OET annually with its recommendations regarding the convenience fee.

Section 15 [Accounts; Audits] changes audit requirements for the Dairy Research, Teaching, and Consumer Education Authority.  This section eliminates a requirement that the Authority provide and pay for an annual independent audit of its official books that  must be filed with the Secretary of State.  This section makes the Authority’s board subject to audit by the Legislative Auditor and requires filing of an audit with the Secretary of State.

Section 16 [Legislative Auditor; Audits of Job Opportunity Building Zones and Business Subsidy Agreements] changes the audit requirements for the creation and operation of job opportunity building zones and business subsidy agreements, shifting audit duties from the State Auditor to the Legislative Auditor.  This section eliminates the requirement that the Office of the State Auditor perform these audits annually and establishes a requirement that the Legislative Auditor conduct these audits as resources allow.  This section removes authorizations for the State Auditor to obtain information from the Commissioners of Revenue and Economic Development to conduct audits.  This section requires all public officials and parties to agreements to:  provide reasonable facilities for examinations by the Legislative Auditor; make available returns and reports; attend and answer the auditor’s lawful inquiries under oath; produce and exhibit all books, accounts, documents, data or any classification, and property that the Legislative Auditor may need to inspect; and in all things aid the auditor in the performance of duties.

Section 17 [Revisor's Instruction] instructs the Revisor of Statutes to change all occurrences of the Office of Enterprise Technology in Minnesota Statutes to the Office of MN.IT Services, and to make conforming changes.

Article 4 - Licensing Boards

This article includes provisions governing barbers, cosmetologists and accountants.

Section 1 [Comprehensive Examination] defines "comprehensive examination."

Section 2 [Fees] adds new fees for retaking written exams to be a registered barber ($10) and to be an apprentice ($10), for renewal of a student permit ($25), for a letter of verification ($25) and for reinspection ($100).

Section 3 [What Constitutes Barbering] adds two practices to the list of those that constitute barbering:  shaving the face or neck and applying lotions to hair.

Section 4 [Who May Receive Certificates of Registration as a Registered Barber] changes eligibility requirements for retaking a failed examination to obtain a certificate of registration to practice as a barber.

Section 5 [Who May Receive Certificates of Registration as a Registered Apprentice] specifies requirements to be registered as a barber apprentice, including recent graduation from barber school, further study requirements for those who graduated more than four years prior to application, testing requirements and registration for incarcerated individuals.

Section 6 [Qualifications] adds to the requirements to be an instructor of barbering by requiring certain course work and requiring applicant to be a registered barber.  This section eliminates a provisional certificate of registration.

Section 7 [Admission Requirement; Course of Instruction] adds chemical waving to the required subjects that must be offered by a barber school.

Section 8 [Application; Fee] requires an applicant for barber license to prove identity with a government-issued photo identification.  The identification must be presented on application and when the applicant appears for examination.  This section eliminates a requirement to furnish the board with signed 5” by 3” photographs.

Section 9 [Examinations, Conduct and Scope] permits the barber board to conduct written exams, beyond the limit of six examinations per year in current law.

Section 10 [Application] requires applicants for initial certificates of registration to be a barber, apprentice, or instructor of barbering to provide proof of identify.

Section 11 [Examination of Nonresidents] eliminates certain constraints on granting registrations to barbers from other states.

Section 12 [Examination of Nonresident Apprentices] eliminates certain constraints on granting registrations to apprentice barbers from other states.

Section 13 [Certificates of Registration and Temporary Permits to be Displayed] requires barbers, apprentices, and instructors to display a photo meeting passport standards.

Section 14 [Effect of Failure to Renew] extends the period in which a barber, apprentice, or instructor may renew a lapsed registration without examination. This section adds administrative penalties if a lapsed or unlicensed status is discovered during inspection.

Section 15 [Administrative Penalties] specifies penalties for missing or lapsed shop registration ($500); unlicensed or unregistered apprentice or barber, first occurrence ($500 on shop and individual); and unlicensed or unregistered apprentice or barber, second occurrence ($1,000 on shop and individual).

Section 16 [Municipalities; Regulation Authorized] permits cities to regulate barber shop hours in addition to all other applicable local regulations.

Section 17 [Misrepresentation] prohibits anyone from representing themselves as a barber or barber shop, or to engage in barbering or operating a barber shop without a license.  Violation is a petty misdemeanor.

Section 18 [Symbols; Barber Pole] prohibits anyone not licensed by the barber board from placing a barber pole in a location that creates an impression that the business is a barber shop.  A barber pole is defined as a red and white or red, and blue striped vertical cylinder commonly recognized as a barber pole.

Section 19 [Cosmetology] amends the definition of cosmetology to include specified services performed to body surfaces on the trunk of the body.

Section 20 [Schedule] adds penalties for certain violations.

Section 21 [License Expiration Date] specifies when cosmetology school licenses expire.

Section 22 [Testing] requires that specified testing must be done by a board-approved provider.

Section 23 [Renewals] makes license renewals subject to meeting continuing education requirements, created in this bill, for cosmetologists, nail technicians, estheticians, and salon managers.

Section 24 [Nonresident Licenses] adds an acceptable test that would qualify a nonresident for a license in Minnesota, provided certain other criteria are met, including a specified number of school hours.  This section also adds a path to licensing for nonresidents who have not had the specified number of school hours. 

Section 25 [Continuing Education Requirements] creates continuing education requirements for cosmetologists, nail technicians, estheticians, and salon managers.

Subdivision 1 [Continuing education requirement] creates a requirement that cosmetologists, nail technicians, esthetician and salon managers obtain four hours of continuing education credits from an accredited school or professional association of cosmetology during the three years prior to the applicant’s renewal date.  This section requires that one of the four hours include instruction on state laws and rules governing cosmetology; three hours must include instruction pertaining to health, safety and sanitation matters.  Credit hours are valid for three years and may be applied simultaneously to all individual licenses held by a licensee.

Subdivision 2 [Schools and professional associations] permits only specified schools and a professional association of cosmetology to offer continuing education curriculum for credit, and permits them to offer online and independent study options.

Subdivision 3 [Proof of credits] requires schools and professional associations to retain documentation of licensees’ credit hours for five years.  This section requires licensees to retain proof of their credits for one year beyond the credits expiration, and requires schools or professional associations to provide proof of completion of a class.

Subdivision 4 [Audit] establishes procedures for the board to audit licensees’ compliance with the continuing education requirements by obtaining proof from licensees of credits earned and by verifying those credits with schools and professional associations.

Section 26 [Requirements] eliminates a requirement that a salon be inspected and licensed prior to commencing business.

Section 27 [Licensing] requires a school manager to maintain an active salon manager’s license and requires an instructor in a school to maintain an active operator or manager’s license in the area in which the instructor holds an instructor’s license.

Section 28 [Limit on Hours of Instruction] limits hours of instruction to ten hours per day per student.

Section 29 [Instruction Location] requires that a school give instruction within a licensed school building.  Online instruction is permitted for board-approved theory-based classes.  Practice-based classes may not be given online.

Section 30 [Prohibited Uses]

Subdivision 1 [Single-use equipment and materials] prohibits specified equipment and materials from being used more than once.  The presence of used articles in the work area is prima facie evidence of reuse.  Failure to dispose of single-use materials and equipment is punishable as specified.

Subdivision 2 [Skin-cutting equipment] prohibits the use of specified equipment intended to cut growths of skin.  The presence of these  articles in the work area is prima facie evidence of use and is punishable as specified.

Subdivision 3 [Substances] prohibits the use of methyl methacrylate liquid monomers and fumigants in performing cosmetology services.

Section 31 [Timing] changes the time period for renewal of certificates for certified public accountants issued by the state Board of Accountancy.  Under current law, certificates may have a term up to three years; this section requires that certificates be issued annually.  This section is effective January 1, 2014.

Section 32 [Residents of other states] deletes obsolete requirements for applications for certificates for certified public accountants made prior to July 1, 2006. 

Section 33 [Fee] requires the board to annually establish a fee schedule and sets caps on a variety of fees set by the Board of Accountancy.

Section 34 [Certificates issued by foreign countries] deletes obsolete provisions for applications made prior to July 1, 2006.

Section 35 [Unlawful acts] allows a CPA firm to use part of a common brand name or network name, including common initials, if the firm is a network firm, as defined in its code of professional conduct, and if the firm follows applicable industry standards when offering services that require independence under industry standards.

Section 36 [Good Cause Exemption] permits the Board of Cosmetology to amend rules to bring them into compliance with the changes in this bill and permits the board to use the good cause exemption from full rule-making.

Section 37 [Revisor’s Instruction] directs the Revisor of Statutes to replace every occurrence of “manicurist” with “nail technician.”

Section 38 [Repealer] repeals obsolete statutes applicable to examinations and certifications prior to July 1, 2006, and repeals a section of rules that sets fees, a section of rules that is obsolete because it relates to a three-year renewal cycle, and a section of rules that is obsolete because it applies to certifications prior to July 1, 2006.

Article 5 - Military and Veterans Provisions

Section 1 [State and Municipal Officers and Employees Not to Lose Pay While on Military Duty] permits employees to choose when during a calendar year to take their paid 15-day military leave and allows employees to take it all at one time or to divide it at their discretion.  This section applies to any officer or employee of the state or of any political subdivision, municipal corporation, or other public agency of the state who is a member of the National Guard, or any other component of the militia of the state, or who is a member of the officers’ reserve corps, the enlisted reserve corps, the Naval Reserve, the Marine Corps reserve, or any other reserve component of the military or naval forces of the United States.  Authorized leave may be taken without loss of pay, seniority status, efficiency rating, vacation, sick leave, or other benefits when engaged in training or active service.

Section 2 [Grant Program] clarifies that "commissioner" in this section means the Commissioner of Veterans Affairs.

Section 3 [Eligibility] changes provisions for eligibility to receive a veterans service office grant. A county that employs a newly hired, but not yet certified, county veterans service officer is eligible for a grant for one year from the date of the officer's appointment.  If the officer does not receive certification within one year, the county becomes ineligible for a grant until the officer receives certification.

Section 4 [Grant Process] authorizes the Commissioner of Veterans Affairs to use any unexpended funds for this program to provide training and education for county veterans service officers.

Section 5 [Qualifying Uses] is a conforming change.  It deletes an authorization to used unexpended funds for training; this same authorization is added to another subdivision of this section of statute in section 4 of this article.

Section 6 [Grant Amount] makes changes to the amounts to be granted to counties under this program.  The change establishes an annual grant for each eligible county of $5,000 to be used for specified purposes benefiting veterans.  In addition to the $5,000 grant, eligible counties receive additional amounts to be determined by the commissioner up to a specified cap based on population.  This section establishes a grant of $2,500 to the Minnesota Association of County Veterans Service Officers to be used for training and accreditation for county veterans service officers and costs associated with reintegration services.

Section 7 [Eligibility] expands eligibility for state assistance for postsecondary education  to veterans who have  served in the United States armed forces at any time, not just since September 11, 2001.   This section also makes spouses and children of these veterans who have died or have a service-connected disability eligible for state assistance for postsecondary education if they meet requirements to receive certain federal education benefits.   This section eliminates authorization to use unexpended funds for this program for training and education for county veterans service officers.

Section 8 [Benefit Amount] exempts payments made under the Veterans Retraining Assistance Program from the reductions to a veterans benefits under the Minnesota GI education assistance program.  Under current law, an eligible applicant receives the cost of attendance minus certain specified payments.  This section adds payments made under the Veterans Retraining Assistance Program to the list of payments that do not reduce the benefit paid.

Section 9 [Veterans Home; Beltrami County] authorizes the Commissioner of Veterans Affairs to establish a veterans home in Beltrami County.

Section 10 [Repealer] repeals a section that placed counties on a three-year rotation cycle for received grants under the Veterans Service Office Grant Program.  This section is no longer needed because other changes to the program in this act award these grants annually to all counties.

Article 6 - Revenue Department

Section 1 [Technology Lease-Purchase Appropriation] replaces a reference to a repealed section.

Section 2 [Program Described; Commissioner’s Duties; Appropriation] changes in cross-reference to the auto theft prevention surcharge, based on the transfer of duties later in this article.

Section 3 [Notice and Procedures] requires employers to file all wage levy disclosure forms and to remit all wage levy payments electronically to the Department of Revenue.  This change is effective for wage levy disclosures and payments filed after December 31, 2013.

Sections 4 to 9, 12, and 13 require that certain taxes be submitted electronically to the Department of Revenue if they reach a specified threshold amount in a given year.  The requirement to submit these taxes electronically is ongoing for the year the threshold is met and for all subsequent years, regardless of whether the threshold is met in subsequent years.  This is a change from current law that required electronic submission in the year that the threshold was reached and in one subsequent year. These provisions are all effective for fiscal year ending June 30, 2013.

Section 4 [Withholding from Wages] requires an employer to remit withheld income taxes to the Minnesota Department of Revenue by electronic means  if the amount withheld in a calendar year is $10,000 or more.  The requirement to submit taxes electronically is ongoing, for all years thereafter. 

Section 5 [Sales and Use Tax] requires a merchant to remit sales and use taxes to the Minnesota Department of Revenue by electronic means if the amount paid in a fiscal year is $10,000 or more.  The requirement to submit taxes electronically is ongoing, for all years thereafter. 

Section 6 [Electronic Payments] requires a taxpayer to remit estimated corporate tax payments electronically if the taxes due in a fiscal year are $10,000 or more.  This requirement to submit taxes electronically is ongoing, for all years thereafter.

Section 7 [Electronic Payments] requires a taxpayer who remits estimated tax payments for certain healthcare-related taxes (hospital tax, surgical center tax, health care provider tax, wholesale drug distributor tax, use tax on prescription drugs) to do so electronically if the estimated aggregate taxes for a fiscal year are $10,000 or more.  This requirement to remit taxes electronically is ongoing, for all years thereafter.

Section 8 [Electronic Payment] requires a cigarette or tobacco products distributor to remit taxes electronically if taxes due in a fiscal year are $10,000 or more.  This requirement to remit taxes electronically is ongoing for all years thereafter.

Section 9 [Electronic Payments] requires licensed brewers, importers, or wholesalers to remit excise taxes electronically if taxes owed in a fiscal year are $10,000 or more.  This requirement to remit taxes electronically is ongoing for all years thereafter.

Section 10 [Automobile Theft Prevention Surcharge] moves the duty to collect an automobile theft surcharge from the Department of Public Safety to the Department of Revenue.  The surcharge is remitted by insurers writing automobile insurance policies; it is $50 cents per vehicle per six months of coverage.  The surcharge is deposited in a special revenue account and is appropriated by an annual statutory appropriation to the general fund (the first $1.3 million) and, amounts in excess of $1.3 million are appropriated to an automobile theft prevention program.  (Section 14 of this bill repeals analogous language from the Public Safety chapter.)

Section 11 [Automobile Theft Prevention Surcharge] requires automobile insurers to file a tax return quarterly  for the automobile surcharge.

Section 12 [Electronic Payments] requires a taxpayer who remits insurance taxes and surcharges to the Department of Revenue to do so electronically if the estimated aggregate taxes for a fiscal year are $10,000 or more.  This requirement to remit taxes electronically is ongoing, for all years thereafter.

Section 13 [Payment of Fee] requires a landfill operator who remits landfill fees to the Department of Revenue to do so electronically if the fee for a fiscal year is $10,000 or more.  This requirement to remit taxes electronically is ongoing, for all years thereafter.

Section 14 [Repealer] repeals:

Paragraph (a):  Section 168A.40, subdivisions 3 and 4.  The duty to collect the automobile theft tax from insurers.  This duty is moved to the Department of Revenue and recodified in section 9.

Paragraph (b): Section 270C.145.  Lease purchase appropriation for integrated tax software (payments have been completed).

Article 7 - Compensation Council

Background.  This article implements the recommendations of the Compensation Council, with changes, to increase the salaries of  constitutional officers and legislators. This article also implements other recommendations regarding setting of salaries and salary limits on employees in the executive branch.

Section 1 [Salaries; Paydays; Mileage; Per Diem] sets the salaries of members of the Legislature at 33 percent of the salary of the Governor. It provides that any increase in legislator salaries resulting from an increase in the Governor’s salary must take effect in accordance with the requirements of the Constitution (requiring an election of the House of Representatives before legislator salary changes take effect.) The effective dates provide for these increases in 2015 and 2016.

Sections 2 [Other Salaries and Compensation Plans] and 4 [Salary Limits] permit the Governor to set the salaries of agency heads anywhere within the salary ranges that have been approved by the Legislature. Other appointing authorities (e.g., the Minnesota State Retirement System) continue to be required to seek interim approval of the Legislative Coordinating Commission and ratification of the Legislature for setting salaries of the agency heads.

Section 3 [Salary Increases] adjusts the Governor’s salary annually based on the Consumer Price Index.

Section 4 [Salary Limits] is a conforming change related to the section 2 change that allows the Governor to set salaries without approval by the LCC and Legislature.

Section 5 [Group I Salary Limits] increases the salary range maximum for the heads of most state agencies from the current level of 95 percent of the salary of the Governor to 133 percent of the Governor’s salary. 

Section 6 [Group II Salary Limits] increases the salary range maximum for the heads of smaller state agencies from the current level of 85 percent of the salary of the Governor to 120 percent of the Governor’s salary. 

Section 7 [Appointing Authorities to Recommend Certain Salaries] establishes parallel requirements for the Governor and for other appointing authorities to consider when setting salaries of agency heads.  Appointing authorities other than the Governor must continue to submit proposed salary increases to the Legislative Coordinating Commission for approval.

Section 8 [Membership] requires that the legislative representatives on the Compensation Council not be legislators.

Section 9 [Salary Limits] eliminates the salary of the agency head as the limit on salaries for employees of that agency. (Salaries of employees will instead be limited by the maximum of their salary ranges provided in their collective bargaining agreements or compensation plans.)

Section 10 [Unusual Employment Situations] amends provisions relating to salary setting for unusual employment situations.  Changes reflect that the maximum salary in these situations is the maximum of the position’s salary range, not the salary of the agency head.

Section 11 [Compensation Study] requires the Commissioner of Management and Budget to contract for a market analysis of compensation for managerial employees in the Executive Branch.

Section 12 [Constitutional Officers Salaries] increases the salary of the Governor by three percent on January 1, 2015, and 2016.  The salaries of other constitutional officers will be adjusted to retain the proportional relationship to the Governor's salary as of January 1, 2013.

Section 13 [Repealer] repeals a provision exempting certain classes of state employees from the agency head salary limit.

Section 14 [Effective Date] provides immediate effective dates for sections 2, 4, 7, 8, and 10 to 12.  Sections 5, 6, and 9 are effective retroactively to January 1, 2013.