Minnesota 2025-2026 Regular Session

Minnesota House Bill HF2418 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		1.1 A bill for an act
2		-	1.2 relating to capital investment; requiring local governments to establish capital
3		-	1.3 project plans; proposing coding for new law in Minnesota Statutes, chapter 16A.
4		-	1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
5		-	1.5 Section 1. [16A.865] CAPITAL PROJECT PLANS.
6		-	1.6 Subdivision 1.Definitions.(a) For purposes of this section, the following terms have
7		-	1.7the meanings given.
8		-	1.8 (b) "Capital project" means improvements or betterments of a capital nature subject to
9		-	1.9section 16A.642, 16A.695, or 16A.86.
10		-	1.10 (c) "Grantee" means a grantee that receives a direct appropriation or grant from an
11		-	1.11appropriation of state money for a capital project on or after July 1, 2025. Grantee does not
12		-	1.12include a state agency or state official.
13		-	1.13 (d) "Preservation" means improvements and betterments of a capital nature consistent
14		-	1.14with those described in section 16B.307, subdivision 1, paragraph (d).
15		-	1.15 Subd. 2.Capital project plan required.A grantee must establish a capital project plan
16		-	1.16for major rehabilitation, expansion, or preservation of all capital projects, including safety
17		-	1.17and security, maintenance and utility costs, availability of repair parts and materials,
18		-	1.18sustainability, and any other criteria the grantee deems relevant.
19		-	1.19 Subd. 3.Certification of plan.(a) A grantee must certify to the commissioner that the
20		-	1.20grantee has established or updated a capital project plan, and is in compliance with the
21		-	1.21capital project plan, in accordance with this section. The certification must be made in the
22		-	1.22time, form, and manner prescribed by the commissioner.
	2	+	1.2 relating to capital investment; requiring local governments to establish replacement
	3	+	1.3 accounts to maintain and replace capital projects that receive state funding;
	4	+	1.4 proposing coding for new law in Minnesota Statutes, chapter 16A.
	5	+	1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
	6	+	1.6 Section 1. [16A.865] CAPITAL PROJECT REPLACEMENT ACCOUNTS.
	7	+	1.7 Subdivision 1.Definitions.(a) For the purposes of this section, the following terms have
	8	+	1.8the meanings given.
	9	+	1.9 (b) "Commissioner" means the commissioner of administration.
	10	+	1.10 (c) "Preservation" means improvements and betterments of a capital nature consistent
	11	+	1.11with those described in section 16B.307, subdivision 1, paragraph (d).
	12	+	1.12 Subd. 2.Replacement account establishment.(a) A grantee that receives a direct
	13	+	1.13appropriation or grant from an appropriation of state money for a capital project subject to
	14	+	1.14section 16A.642, 16A.695, or 16A.86, must establish a capital project replacement fund for
	15	+	1.15major rehabilitation, expansion, replacement, or preservation of the capital project once the
	16	+	1.16project has reached its useful life, or for another use as permitted under this section. Money
	17	+	1.17must remain in the account for the useful life of the capital project, as determined by the
	18	+	1.18grant agreement with the granting state agency, unless use of the fund is approved in writing
	19	+	1.19by the granting state agency for major rehabilitation, expansion, replacement, or preservation
	20	+	1.20of the capital project funded with state money, or to address a capital project for a different
	21	+	1.21capital asset owned by the grantee.
23	22		1Section 1.
24		-	REVISOR JSK ~~H2418-1~~~~HF2418 FIRST ENGROSSMENT~~
	23	+	REVISOR JSK/KR 25-0427902/27/25
25	24		State of Minnesota
26	25		This Document can be made available
27	26		in alternative formats upon request
28	27		HOUSE OF REPRESENTATIVES
29	28		H. F. No. 2418
30	29		NINETY-FOURTH SESSION
31	30		Authored by Tabke and Lee, F.,03/17/2025
32		-	The bill was read for the first time and referred to the Committee on Elections Finance and Government Operations
33		-	Adoption of Report: Amended and re-referred to the Committee on Capital Investment04/01/2025 2.1 (b) The commissioner may require a grantee to provide additional documentation or
34		-	2.2information about a capital project plan to verify a certification made under this subdivision.
35		-	2.3 EFFECTIVE DATE.This section is effective for capital projects funded through state
36		-	2.4capital project grant agreements entered into on or after July 1, 2025.
	31	+	The bill was read for the first time and referred to the Committee on Elections Finance and Government Operations 2.1 (b) A grantee must adopt a capital project replacement policy that specifies the following
	32	+	2.2for the capital project replacement fund:
	33	+	2.3 (1) the risks to be mitigated or managed by the fund;
	34	+	2.4 (2) the intended use of the replacement fund, including, but not limited to, how the fund
	35	+	2.5will be used for major rehabilitation, expansion, replacement, or preservation of the capital
	36	+	2.6project; and
	37	+	2.7 (3) criteria for the use of the fund to address other capital improvement needs of the
	38	+	2.8grantee, including safety and security, maintenance and utility costs, availability of repair
	39	+	2.9parts and materials, sustainability, and any other criteria the grantee deems relevant.
	40	+	2.10 (c) For the purposes of this section, "grantee" does not include a state agency or state
	41	+	2.11official.
	42	+	2.12 Subd. 3.Minimum deposits; fund balance.(a) The commissioner must determine the
	43	+	2.13annual minimum deposit amounts to be deposited into capital project replacement funds by
	44	+	2.14capital project type. The commissioner must take into account depreciation, construction
	45	+	2.15cost inflation, and other relevant factors when determining the minimum deposit amounts.
	46	+	2.16 (b) A grantee must not be required to maintain a capital project replacement fund balance
	47	+	2.17greater than the amount of the direct appropriation or grant from an appropriation of state
	48	+	2.18money for the capital project.
	49	+	2.19 Subd. 4.Account auditing.The state auditor may audit capital project replacement
	50	+	2.20accounts as part of the regular audits of local governments.
	51	+	2.21 Subd. 5.Exceptions.Capital projects that already require a replacement fund under
	52	+	2.22section 446A.072, subdivision 12, or any other law, rule, or ordinance, are exempt from the
	53	+	2.23requirements under this section, so long as the deposits into the replacement fund are at
	54	+	2.24least as large as the minimum deposits established by the commissioner under subdivision
	55	+	2.253.
	56	+	2.26 Subd. 6.Penalty.Failure of a grantee to comply with the requirements of this section
	57	+	2.27shall result in the granting state agency assessing a penalty fee to the grantee equal to one
	58	+	2.28percent of the appropriation of state money for the capital project for each year of
	59	+	2.29noncompliance. Penalty fees shall be remitted by the granting state agency to the
	60	+	2.30commissioner of management and budget for deposit into the general fund.
	61	+	2.31 EFFECTIVE DATE.This section is effective for capital projects funded through state
	62	+	2.32capital project grant agreements entered into on or after July 1, 2025.
37	63		2Section 1.
38		-	REVISOR JSK ~~H2418-1~~~~HF2418 FIRST ENGROSSMENT~~
	64	+	REVISOR JSK/KR 25-0427902/27/25