Minnesota 2025-2026 Regular Session

Minnesota Senate Bill SF635 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	1.1 A bill for an act
2	2	1.2 relating to energy; establishing a process to compensate businesses for loss of
3	3	1.3 business opportunity resulting from sale and closure of a biomass energy plant.
4	4	1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
5	5	1.5 Section 1. BIOMASS BUSINESS COMPENSATION.
6	6	1.6 Subdivision 1.Definitions.(a) For the purposes of this section, the following terms have
7	7	1.7the meanings given.
8	8	1.8 (b) "Biomass plant" means the biomass plant identified under Minnesota Statutes, section
9	9	1.9116C.779, subdivision 1, paragraph (f).
10	10	1.10 (c) "Early termination" means the early termination of the power purchase agreement
11	11	1.11authorized under Minnesota Statutes, section 216B.2424, subdivision 9, with the biomass
12	12	1.12plant.
13	13	1.13 (d) "Operating income" means a business's revenue minus its operating expenses.
14	14	1.14 Subd. 2.Office of Administrative Hearings; claims process.(a) The chief
15	15	1.15administrative law judge of the Office of Administrative Hearings must assign an
16	16	1.16administrative law judge to administer a claims award process to compensate businesses
17	17	1.17negatively affected by the early termination. The chief administrative law judge may develop
18	18	1.18a process, prescribe forms, identify documentation affected businesses must submit with
19	19	1.19claims, and issue awards to eligible businesses consistent with this section. The process
20	20	1.20must allow, but not require, an authorized representative from each business that applies
21	21	1.21for compensation to appear in person before the assigned administrative law judge to provide
22	22	1.22evidence in support of the business's claim.
23	23	1Section 1.
24	24	25-01245 as introduced01/13/25 REVISOR RSI/EN
25	25	SENATE
26	26	STATE OF MINNESOTA
27	27	S.F. No. 635NINETY-FOURTH SESSION
28	28	(SENATE AUTHORS: LANG)
29	29	OFFICIAL STATUSD-PGDATE
30	30	Introduction and first reading01/27/2025
31	31	Referred to Energy, Utilities, Environment, and Climate 2.1 (b) The chief administrative law judge may contract with and use the services of financial
32	32	2.2or other consultants to examine financial documentation presented by claimants or otherwise
33	33	2.3assist in the evaluation and award of claims.
34	34	2.4 (c) Records submitted to the Office of Administrative Hearings as part of the claims
35	35	2.5process constitute business data under Minnesota Statutes, section 13.591.
36	36	2.6 (d) An award made under this section is final and is not subject to judicial review.
37	37	2.7 (e) An award made under this section does not constitute an admission of liability by
38	38	2.8the state for any damages or other losses suffered by a business affected by the early
39	39	2.9termination.
40	40	2.10 Subd. 3.Eligibility.To be eligible for an award of compensation, an affected business
41	41	2.11must meet the following criteria:
42	42	2.12 (1) as of May 1, 2017, the affected business was operating under the terms of a valid
43	43	2.13written contract, or an oral contract that is sufficiently supported by business records, with
44	44	2.14the company operating the biomass plant or the fertilizer plant integrated with the biomass
45	45	2.15plant to supply or manage material for, or receive material from, the biomass plant or the
46	46	2.16fertilizer plant integrated with the biomass plant;
47	47	2.17 (2) the affected business is located in Minnesota; and
48	48	2.18 (3) as the result of the early termination, the affected business suffered:
49	49	2.19 (i) decreased operating income; or
50	50	2.20 (ii) the loss of value of investments in real or personal property essential to business
51	51	2.21operations with the biomass plant.
52	52	2.22 Subd. 4.Types of claims.(a) An eligible business may make claims for a compensation
53	53	2.23award based on either or both:
54	54	2.24 (1) decreased operating income; or
55	55	2.25 (2) the loss of value of investments in real or personal property essential to business
56	56	2.26operations with the biomass plant.
57	57	2.27 (b) To establish and quantify a claim for decreased operating income, an eligible business
58	58	2.28must:
59	59	2.29 (1) demonstrate the eligible business's operating income over the past five years derived
60	60	2.30from supplying or managing material for, or receiving material from, the biomass plant;
61	61	2Section 1.
62	62	25-01245 as introduced01/13/25 REVISOR RSI/EN 3.1 (2) present evidence of any alternative business opportunities the eligible business has
63	63	3.2pursued or could pursue to mitigate the loss of revenue from the termination of its contract
64	64	3.3with the biomass plant; and
65	65	3.4 (3) demonstrate the amount that the business's annual operating income, including
66	66	3.5operating income from any alternative business opportunities, after the termination of the
67	67	3.6business's contract with the biomass plant is less than the five-year average of the business's
68	68	3.7annual operating income before the early termination.
69	69	3.8 (c) To establish and quantify a loss of value of investments in real or personal property
70	70	3.9claim, an eligible business must provide sufficient evidence of:
71	71	3.10 (1) the essential nature of the investment made in the property to fulfill the contract with
72	72	3.11the biomass plant;
73	73	3.12 (2) the extent to which the eligible business is able to repurpose the property for another
74	74	3.13productive use after the early termination, including but not limited to the use, sales, salvage,
75	75	3.14or scrap value of the property for which the loss is claimed; and
76	76	3.15 (3) the value of the eligible business's nondepreciated investment in the property.
77	77	3.16 Subd. 5.Limitations on awards.(a) A compensation award for a decreased operating
78	78	3.17income claim must not exceed the amount calculated under subdivision 4, paragraph (b),
79	79	3.18clause (3), multiplied by two.
80	80	3.19 (b) The use, sales, salvage, or scrap value of the property for which a loss is claimed
81	81	3.20must be deducted from a compensation award for a loss of value of investments in real or
82	82	3.21personal property claim.
83	83	3.22 (c) A payment received from business interruption insurance policies, settlements, or
84	84	3.23other forms of compensation related to the termination of the business's contract with the
85	85	3.24biomass plant must be deducted from any compensation award provided under this section.
86	86	3.25 Subd. 6.Priority.The chief administrative law judge may give priority to claims by
87	87	3.26eligible businesses that demonstrate a significant effort to pursue alternative business
88	88	3.27opportunities or to conduct other loss mitigation efforts to reduce the eligible business's
89	89	3.28claimed losses related to the termination of the eligible business's contract with the company
90	90	3.29operating the biomass plant.
91	91	3.30 Subd. 7.Awarding claims.If the amount provided for compensation in the biomass
92	92	3.31business compensation account established under section 2 is insufficient to fully award all
93	93	3.32claims eligible for an award, all awards must be adjusted proportionally based on the value
94	94	3.33of the claim.
95	95	3Section 1.
96	96	25-01245 as introduced01/13/25 REVISOR RSI/EN 4.1 Subd. 8.Deadlines.The chief administrative law judge must make the application
97	97	4.2process for eligible claims available by August 1, 2025. A business seeking an award under
98	98	4.3this section must file all claims with the chief administrative law judge within 60 days of
99	99	4.4the date the chief administrative law judge makes the application process for eligible claims
100	100	4.5available. All preliminary awards on eligible claims must be made within 120 days of the
101	101	4.6deadline date to file claims. Any requests to reconsider an award denial must be filed with
102	102	4.7the chief administrative law judge within 60 days of the notice date for preliminary awards.
103	103	4.8All final awards for eligible claims must be made within 60 days of the deadline date to file
104	104	4.9reconsideration requests. The commissioner of management and budget must pay all awarded
105	105	4.10claims within 45 days of the date the commissioner of management and budget receives
106	106	4.11notice of the final awards from the chief administrative law judge.
107	107	4.12 Subd. 9.Expiration.This section expires June 30, 2027.
108	108	4.13 EFFECTIVE DATE.This section is effective the day following final enactment.
109	109	4.14 Sec. 2. BIOMASS BUSINESS COMPENSATION ACCOUNT.
110	110	4.15 Subdivision 1.Account established.A biomass business compensation account is
111	111	4.16established as a separate account in the special revenue fund in the state treasury.
112	112	4.17Appropriations and transfers to the account must be credited to the account. Earnings,
113	113	4.18including interest and any other earnings arising from the assets of the account, are credited
114	114	4.19to the account. Money remaining in the account on December 31, 2027, must be transferred
115	115	4.20to the renewable development account established under Minnesota Statutes, section
116	116	4.21116C.779.
117	117	4.22 Subd. 2.Funding for the special account.Notwithstanding Minnesota Statutes, section
118	118	4.23116C.779, subdivision 1, paragraph (j), on July 1, 2025, $20,000,000, and on July 1, 2026,
119	119	4.24$20,000,000 must be transferred from the renewable development account under Minnesota
120	120	4.25Statutes, section 116C.779, to the biomass business compensation account established under
121	121	4.26subdivision 1. The transferred money is appropriated to pay eligible obligations under the
122	122	4.27biomass business compensation program established under section 1.
123	123	4.28 Subd. 3.Payment of expenses.The chief administrative law judge must certify to the
124	124	4.29commissioner of management and budget the total costs incurred to administer the biomass
125	125	4.30business compensation claims process. The commissioner of management and budget must
126	126	4.31transfer an amount equal to the certified costs incurred for biomass business compensation
127	127	4.32claim activities from the renewable development account under Minnesota Statutes, section
128	128	4.33116C.779, and deposit it in the administrative hearings account under Minnesota Statutes,
129	129	4.34section 14.54. Transfers may occur quarterly throughout the fiscal year and must be based
130	130	4Sec. 2.
131	131	25-01245 as introduced01/13/25 REVISOR RSI/EN 5.1on quarterly cost and revenue reports, with final certification and reconciliation after each
132	132	5.2fiscal year. The total amount transferred under this subdivision must not exceed $200,000.
133	133	5.3 Subd. 4.Expiration.This section expires June 30, 2027.
134	134	5.4 EFFECTIVE DATE.This section is effective the day following final enactment.
135	135	5Sec. 2.
136	136	25-01245 as introduced01/13/25 REVISOR RSI/EN