Purpose of the Bill

The purpose of this bill is to ensure accountability and responsible practices by extending contractor requirements to recipients of state loans and grants over $50,000 in Minnesota.

Main Provisions

• Application Requirements for State Loans: For applications involving state-funded loans of $50,000 or more, applicants must submit a certified statement under oath confirming they meet specified minimum requirements as outlined in section 16C.285, subdivision 3. This responsibility is managed by the commissioner, who can assign this duty to other state agencies.

• Grant Recipient Risk Assessment: Before issuing grants of $50,000 or more, state agencies must perform a pre-award risk assessment to evaluate the grant applicant's ability to fulfill the grant requirements. This includes reviewing the applicant's history with similar work, financial stability, and business practices.

• Financial Documentation for Nonprofits and For-Profit Entities:

  • Nonprofits: Must provide the most recent IRS form 990 or equivalent financial statements if new or exempt from filing.
  • For-Profit Businesses: Must submit recent tax returns, financial statements, and other proof of financial health and operational controls.

• Certification of Compliance and Standing: Applicants must confirm, via a signed oath, that they adhere to specific requirements, maintain good standing with the state, and provide evidence of proper audits if applicable.

• Integrity Statement Requirements: Applicants must certify that none of their key personnel have been convicted of financial felonies in the last ten years.

Significant Changes

• This bill mandates that standards previously applicable primarily to contractors be extended to all significant recipients of state financial awards, strengthening oversight and accountability.
• It introduces a structured risk assessment process for grant awards, placing more emphasis on managerial and financial evaluations before providing state funds.

Relevant Terms

• Responsible Contractor
• State Loans and Grants
• Risk Assessment
• Nonprofit and For-Profit Financial Requirements
• Financial Felonies
• State Compliance Certification