Bill Text: MN HF997 | 2011-2012 | 87th Legislature | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: State agency civil penalty imposition regulated, and fees and expenses awarded to prevailing parties in actions involving state agencies.
Spectrum: Partisan Bill (Republican 8-0)
Status: (Introduced - Dead) 2012-02-09 - Motion to recall and re-refer, motion prevailed Ways and Means [HF997 Detail]
Download: Minnesota-2011-HF997-Introduced.html
Bill Title: State agency civil penalty imposition regulated, and fees and expenses awarded to prevailing parties in actions involving state agencies.
Spectrum: Partisan Bill (Republican 8-0)
Status: (Introduced - Dead) 2012-02-09 - Motion to recall and re-refer, motion prevailed Ways and Means [HF997 Detail]
Download: Minnesota-2011-HF997-Introduced.html
1.2relating to civil actions; regulating the imposition of certain civil penalties by
1.3state agencies; awarding fees and expenses to prevailing parties in certain actions
1.4involving state agencies and municipalities;amending Minnesota Statutes 2010,
1.5sections 15.471, subdivision 6, by adding a subdivision; 15.472; proposing
1.6coding for new law in Minnesota Statutes, chapters 15; 471.
1.7BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.8 Section 1. [15.062] PENALTY FACTORS.
1.9(a) In determining the amount of civil penalty to be proposed or assessed in an
1.10administrative or civil action by any state agency, where there is an allegation of a
1.11violation of statute, regulation, term, condition, or any enforceable standard, the following
1.12factors shall be considered by the state agency, delegated county administering state
1.13authority, administrative law judge, or court:
1.14(1) the willfulness of the violation;
1.15(2) the gravity of the violation, including irreparable damage to humans, animals,
1.16air, water, land, or other natural resources of the state;
1.17(3) the number of prior contacts with the person where the state agency offered
1.18reasonable corrective measures prior to issuing the fine;
1.19(4) the history of past violations;
1.20(5) the number of violations;
1.21(6) the economic benefit gained by the person by allowing or committing the
1.22violation;
1.23(7) the costs incurred to correct the violation or otherwise comply;
1.24(8) the person's ability to pay;
1.25(9) other economic factors affecting the feasibility or practicality of compliance;
2.1(10) penalties that similarly situated persons have paid to the state for similar
2.2violations;
2.3(11) the cooperation and responsiveness of the person, provided that a penalty shall
2.4not be imposed or enhanced because a person has contested a violation or asserted their
2.5rights or defenses; and
2.6(12) other factors as justice may require.
2.7(b) For a violation after an initial violation, the state agency, delegated county
2.8administering state authority, administrative law judge, or court shall, in determining the
2.9amount of a penalty, also consider the following factors:
2.10(1) similarity of the most recent previous violation and the violation to be penalized;
2.11(2) time elapsed since the last violation;
2.12(3) number of previous violations; and
2.13(4) response of the person to the most recent previous violation identified.
2.14(c) In addition to stating the factual and legal basis for each violation, the state
2.15agency or delegated county administering state authority shall, in its notice, demand,
2.16order, or complaint in an administrative or civil proceeding, document the application of
2.17these considerations in determining any proposed penalty. The state agency or delegated
2.18county administering state authority shall provide this documentation to the person subject
2.19of the administrative or civil action 60 days before initiating any such action.
2.20 Sec. 2. [15.0621] INITIAL VIOLATION; PENALTY LIMITATION.
2.21In any case where the person subject to the statute, regulation, term, or condition of
2.22any enforceable standard has no history of noncompliance, the state agency, delegated
2.23county administering state authority, administrative law judge, or court shall not assess a
2.24penalty of more than 20 percent of the statutory maximum that may be imposed for such
2.25violation unless the alleged violation presents an imminent and substantial endangerment
2.26to the public, human health, or the environment or where there is an allegation of a
2.27violation of the specific terms of an administrative order, a judicial order, consent decree, a
2.28stipulation agreement, or a schedule of compliance.
2.29 Sec. 3. Minnesota Statutes 2010, section 15.471, is amended by adding a subdivision
2.30to read:
2.31 Subd. 3a. Demand. "Demand" means the express demand of the agency which led
2.32to the civil action or contested case proceeding but does not include a recitation by the
2.33agency of the maximum statutory penalty:
2.34(1) in the administrative complaint; or
3.1(2) elsewhere when accompanied by an express demand for a lesser amount.
3.2 Sec. 4. Minnesota Statutes 2010, section 15.471, subdivision 6, is amended to read:
3.3 Subd. 6. Party. (a) Except as modified by paragraph (b), "party" means a person
3.4named or admitted as a party, or seeking and entitled to be admitted as a party, in a court
3.5action or contested case proceeding, or a person admitted by an administrative law judge
3.6for limited purposes, and who is:
3.7(1) an unincorporated business, partnership, corporation, association, or
3.8organization, having not more than 500 employees at the time the civil action was filed or
3.9the contested case proceeding was initiated; and
3.10(2) an unincorporated business, partnership, corporation, association, or organization
3.11whose annual revenues did not exceed$7,000,000 $30,000,000 at the time the civil action
3.12was filed or the contested case proceeding was initiated.
3.13(b) "Party" also includes a partner, officer, shareholder, member, or owner of an
3.14entity described in paragraph (a), clauses (1) and (2).
3.15(c) "Party" does not include a person providing services pursuant to licensure or
3.16reimbursement on a cost basis by the Department of Health or the Department of Human
3.17Services, when that person is named or admitted or seeking to be admitted as a party in a
3.18matter which involves the licensing or reimbursement rates, procedures, or methodology
3.19applicable to those services.
3.20 Sec. 5. Minnesota Statutes 2010, section 15.472, is amended to read:
3.2115.472 FEES AND EXPENSES; CIVIL ACTION OR CONTESTED CASE
3.22PROCEEDING INVOLVING STATE.
3.23(a) If a prevailing party other than the state, in a civil action or contested case
3.24proceeding other than a tort action, brought by or against the state, shows that the position
3.25of the state was not substantially justified, the court or administrative law judge shall award
3.26fees and other expenses to the party unless special circumstances make an award unjust.
3.27(b) If, in a civil action or contested case proceeding arising from an agency action
3.28to enforce a party's compliance with a statutory or regulatory requirement, the demand
3.29by the agency is substantially in excess of the decision of the administrative law judge
3.30or court and is unreasonable when compared with such decision under the facts and
3.31circumstances of the case, the administrative law judge or court shall award to the party
3.32the fees and other expenses related to defending against the excessive demand, unless
3.33the party has committed a willful violation of law or engaged in conduct that unduly
4.1and unreasonably protracted the final resolution of the matter in controversy, or special
4.2circumstances make an award unjust.
4.3(b) (c) A party seeking an award of fees and other expenses shall, within 30 days of
4.4final judgment in the action, submit to the court or administrative law judge an application
4.5of fees and other expenses which shows that the party is a prevailing party and is eligible
4.6to receive an award, and the amount sought, including an itemized statement from any
4.7attorney or expert witness representing or appearing on behalf of the party stating the
4.8actual time expended and the rate at which fees and other expenses were computed. The
4.9party shall also allege that the position of the state was not substantially justified.
4.10(c) (d) The court or administrative law judge may reduce the amount to be awarded
4.11under this section, or deny an award, to the extent that the prevailing party during
4.12the proceedings engaged in conduct that unduly and unreasonably protracted the final
4.13resolution of the matter in controversy. The decision of an administrative law judge under
4.14this section must be made a part of the record containing the final decision of the agency
4.15and must include written findings and conclusions.
4.16(d) (e) This section does not preclude a party from recovering costs, disbursements,
4.17fees, and expenses under other applicable law.
4.18 Sec. 6. [471.421] DEFINITIONS.
4.19 Subdivision 1. Terms defined. For purposes of sections 471.421 to 471.423, the
4.20terms defined in this section have the meanings given them.
4.22litigation, including:
4.23(1) filing fees;
4.24(2) subpoena fees and mileage;
4.25(3) transcript costs and court reporter fees;
4.26(4) expert witness fees;
4.27(5) the reasonable cost of any study, analysis, engineering report, survey, appraisal,
4.28test, or project;
4.29(6) photocopying and printing costs;
4.30(7) postage and delivery costs; and
4.31(8) service of process fees.
4.32 Subd. 3. Demand. "Demand" means the express demand of the agency which led
4.33to the civil action or contested case proceeding but does not include a recitation by the
4.34agency of the maximum statutory penalty:
4.35(1) in the administrative complaint; or
5.1(2) elsewhere when accompanied by an express demand for a lesser amount.
5.2 Subd. 4. Fees. "Fees" means the reasonable attorney fees or reasonable fees charged
5.3by a person not an attorney who is authorized by law or rule to represent the party and
5.4may include reasonable charges by the party, the party's employee, or agent. The amount
5.5of fees must be based upon prevailing market rates for the kind and quality of the services
5.6furnished. In a court action, an expert witness may not be compensated at a rate in excess
5.7of the highest rate of compensation for expert witnesses paid by the state.
5.8 Subd. 5. Municipality. "Municipality" means a home rule charter or statutory city,
5.9county, town, school district, political subdivision, or agency of local government. The
5.10term also includes the Metropolitan Council or a board or agency created under chapter
5.11473.
5.12 Subd. 6. Party. (a) Except as modified by paragraph (b), "party" means a person
5.13named or admitted as a party, or seeking and entitled to be admitted as a party, in a court
5.14action, and who is:
5.15(1) an unincorporated business, partnership, corporation, association, or organization,
5.16having not more than 500 employees at the time the civil action was filed; and
5.17(2) an unincorporated business, partnership, corporation, association, or organization
5.18whose annual revenues did not exceed $30,000,000 at the time the civil action was filed.
5.19(b) "Party" also includes a partner, officer, shareholder, member, or owner of an
5.20entity described in paragraph (a), clauses (1) and (2). The term does not include a party in
5.21a civil action brought by or against the municipality in connection with the granting or
5.22denying of a liquor license.
5.23 Subd. 7. Substantially justified. "Substantially justified" means that the
5.24municipality's position had a reasonable basis in law and fact, based on the totality of the
5.25circumstances before and during the litigation.
5.26 Sec. 7. [471.422] FEES AND EXPENSES; CIVIL ACTION INVOLVING
5.27MUNICIPALITY.
5.28(a) The court shall award fees and other expenses to a prevailing party in a civil
5.29action unless special circumstances make an award unjust, provided that:
5.30(1) the action is a civil action other than a tort action;
5.31(2) the municipality's orders or total cost of compliance with the orders is in an
5.32amount of $10,000 or more;
5.33(3) the prevailing party is not the municipality; and
5.34(4) the position of the municipality was not substantially justified.
6.1(b) If, in a civil action arising from an agency action to enforce a party's compliance
6.2with a statutory, regulatory, or ordinance requirement, the demand by the municipality is
6.3substantially in excess of the decision of the court and is unreasonable when compared
6.4with such decision under the facts and circumstances of the case, the court shall award to
6.5the party the fees and other expenses related to defending against the excessive demand,
6.6unless the party has committed a willful violation of law or engaged in conduct that
6.7unduly and unreasonably protracted the final resolution of the matter in controversy, or
6.8special circumstances make an award unjust.
6.9 Sec. 8. [471.423] PAYMENT OF COSTS AND FEES.
6.10A judgment against a municipality in a civil action for fees and expenses under
6.11section 471.422 must be paid from funds of the municipality.
6.12 Sec. 9. TITLE.
6.13This act may be cited as the "Small Business Bill of Rights - Regulatory Fairness
6.14Act."
6.15 Sec. 10. EFFECTIVE DATE; APPLICATION.
6.16This act is effective August 1, 2011, and applies to administrative or civil actions
6.17commenced on or after that date.
1.3state agencies; awarding fees and expenses to prevailing parties in certain actions
1.4involving state agencies and municipalities;amending Minnesota Statutes 2010,
1.5sections 15.471, subdivision 6, by adding a subdivision; 15.472; proposing
1.6coding for new law in Minnesota Statutes, chapters 15; 471.
1.7BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.8 Section 1. [15.062] PENALTY FACTORS.
1.9(a) In determining the amount of civil penalty to be proposed or assessed in an
1.10administrative or civil action by any state agency, where there is an allegation of a
1.11violation of statute, regulation, term, condition, or any enforceable standard, the following
1.12factors shall be considered by the state agency, delegated county administering state
1.13authority, administrative law judge, or court:
1.14(1) the willfulness of the violation;
1.15(2) the gravity of the violation, including irreparable damage to humans, animals,
1.16air, water, land, or other natural resources of the state;
1.17(3) the number of prior contacts with the person where the state agency offered
1.18reasonable corrective measures prior to issuing the fine;
1.19(4) the history of past violations;
1.20(5) the number of violations;
1.21(6) the economic benefit gained by the person by allowing or committing the
1.22violation;
1.23(7) the costs incurred to correct the violation or otherwise comply;
1.24(8) the person's ability to pay;
1.25(9) other economic factors affecting the feasibility or practicality of compliance;
2.1(10) penalties that similarly situated persons have paid to the state for similar
2.2violations;
2.3(11) the cooperation and responsiveness of the person, provided that a penalty shall
2.4not be imposed or enhanced because a person has contested a violation or asserted their
2.5rights or defenses; and
2.6(12) other factors as justice may require.
2.7(b) For a violation after an initial violation, the state agency, delegated county
2.8administering state authority, administrative law judge, or court shall, in determining the
2.9amount of a penalty, also consider the following factors:
2.10(1) similarity of the most recent previous violation and the violation to be penalized;
2.11(2) time elapsed since the last violation;
2.12(3) number of previous violations; and
2.13(4) response of the person to the most recent previous violation identified.
2.14(c) In addition to stating the factual and legal basis for each violation, the state
2.15agency or delegated county administering state authority shall, in its notice, demand,
2.16order, or complaint in an administrative or civil proceeding, document the application of
2.17these considerations in determining any proposed penalty. The state agency or delegated
2.18county administering state authority shall provide this documentation to the person subject
2.19of the administrative or civil action 60 days before initiating any such action.
2.20 Sec. 2. [15.0621] INITIAL VIOLATION; PENALTY LIMITATION.
2.21In any case where the person subject to the statute, regulation, term, or condition of
2.22any enforceable standard has no history of noncompliance, the state agency, delegated
2.23county administering state authority, administrative law judge, or court shall not assess a
2.24penalty of more than 20 percent of the statutory maximum that may be imposed for such
2.25violation unless the alleged violation presents an imminent and substantial endangerment
2.26to the public, human health, or the environment or where there is an allegation of a
2.27violation of the specific terms of an administrative order, a judicial order, consent decree, a
2.28stipulation agreement, or a schedule of compliance.
2.29 Sec. 3. Minnesota Statutes 2010, section 15.471, is amended by adding a subdivision
2.30to read:
2.31 Subd. 3a. Demand. "Demand" means the express demand of the agency which led
2.32to the civil action or contested case proceeding but does not include a recitation by the
2.33agency of the maximum statutory penalty:
2.34(1) in the administrative complaint; or
3.1(2) elsewhere when accompanied by an express demand for a lesser amount.
3.2 Sec. 4. Minnesota Statutes 2010, section 15.471, subdivision 6, is amended to read:
3.3 Subd. 6. Party. (a) Except as modified by paragraph (b), "party" means a person
3.4named or admitted as a party, or seeking and entitled to be admitted as a party, in a court
3.5action or contested case proceeding, or a person admitted by an administrative law judge
3.6for limited purposes, and who is:
3.7(1) an unincorporated business, partnership, corporation, association, or
3.8organization, having not more than 500 employees at the time the civil action was filed or
3.9the contested case proceeding was initiated; and
3.10(2) an unincorporated business, partnership, corporation, association, or organization
3.11whose annual revenues did not exceed
3.12was filed or the contested case proceeding was initiated.
3.13(b) "Party" also includes a partner, officer, shareholder, member, or owner of an
3.14entity described in paragraph (a), clauses (1) and (2).
3.15(c) "Party" does not include a person providing services pursuant to licensure or
3.16reimbursement on a cost basis by the Department of Health or the Department of Human
3.17Services, when that person is named or admitted or seeking to be admitted as a party in a
3.18matter which involves the licensing or reimbursement rates, procedures, or methodology
3.19applicable to those services.
3.20 Sec. 5. Minnesota Statutes 2010, section 15.472, is amended to read:
3.2115.472 FEES AND EXPENSES; CIVIL ACTION OR CONTESTED CASE
3.22PROCEEDING INVOLVING STATE.
3.23(a) If a prevailing party other than the state, in a civil action or contested case
3.24proceeding other than a tort action, brought by or against the state, shows that the position
3.25of the state was not substantially justified, the court or administrative law judge shall award
3.26fees and other expenses to the party unless special circumstances make an award unjust.
3.27(b) If, in a civil action or contested case proceeding arising from an agency action
3.28to enforce a party's compliance with a statutory or regulatory requirement, the demand
3.29by the agency is substantially in excess of the decision of the administrative law judge
3.30or court and is unreasonable when compared with such decision under the facts and
3.31circumstances of the case, the administrative law judge or court shall award to the party
3.32the fees and other expenses related to defending against the excessive demand, unless
3.33the party has committed a willful violation of law or engaged in conduct that unduly
4.1and unreasonably protracted the final resolution of the matter in controversy, or special
4.2circumstances make an award unjust.
4.3
4.4final judgment in the action, submit to the court or administrative law judge an application
4.5of fees and other expenses which shows that the party is a prevailing party and is eligible
4.6to receive an award, and the amount sought, including an itemized statement from any
4.7attorney or expert witness representing or appearing on behalf of the party stating the
4.8actual time expended and the rate at which fees and other expenses were computed. The
4.9party shall also allege that the position of the state was not substantially justified.
4.10
4.11under this section, or deny an award, to the extent that the prevailing party during
4.12the proceedings engaged in conduct that unduly and unreasonably protracted the final
4.13resolution of the matter in controversy. The decision of an administrative law judge under
4.14this section must be made a part of the record containing the final decision of the agency
4.15and must include written findings and conclusions.
4.16
4.17fees, and expenses under other applicable law.
4.18 Sec. 6. [471.421] DEFINITIONS.
4.19 Subdivision 1. Terms defined. For purposes of sections 471.421 to 471.423, the
4.20terms defined in this section have the meanings given them.
4.22litigation, including:
4.23(1) filing fees;
4.24(2) subpoena fees and mileage;
4.25(3) transcript costs and court reporter fees;
4.26(4) expert witness fees;
4.27(5) the reasonable cost of any study, analysis, engineering report, survey, appraisal,
4.28test, or project;
4.29(6) photocopying and printing costs;
4.30(7) postage and delivery costs; and
4.31(8) service of process fees.
4.32 Subd. 3. Demand. "Demand" means the express demand of the agency which led
4.33to the civil action or contested case proceeding but does not include a recitation by the
4.34agency of the maximum statutory penalty:
4.35(1) in the administrative complaint; or
5.1(2) elsewhere when accompanied by an express demand for a lesser amount.
5.2 Subd. 4. Fees. "Fees" means the reasonable attorney fees or reasonable fees charged
5.3by a person not an attorney who is authorized by law or rule to represent the party and
5.4may include reasonable charges by the party, the party's employee, or agent. The amount
5.5of fees must be based upon prevailing market rates for the kind and quality of the services
5.6furnished. In a court action, an expert witness may not be compensated at a rate in excess
5.7of the highest rate of compensation for expert witnesses paid by the state.
5.8 Subd. 5. Municipality. "Municipality" means a home rule charter or statutory city,
5.9county, town, school district, political subdivision, or agency of local government. The
5.10term also includes the Metropolitan Council or a board or agency created under chapter
5.11473.
5.12 Subd. 6. Party. (a) Except as modified by paragraph (b), "party" means a person
5.13named or admitted as a party, or seeking and entitled to be admitted as a party, in a court
5.14action, and who is:
5.15(1) an unincorporated business, partnership, corporation, association, or organization,
5.16having not more than 500 employees at the time the civil action was filed; and
5.17(2) an unincorporated business, partnership, corporation, association, or organization
5.18whose annual revenues did not exceed $30,000,000 at the time the civil action was filed.
5.19(b) "Party" also includes a partner, officer, shareholder, member, or owner of an
5.20entity described in paragraph (a), clauses (1) and (2). The term does not include a party in
5.21a civil action brought by or against the municipality in connection with the granting or
5.22denying of a liquor license.
5.23 Subd. 7. Substantially justified. "Substantially justified" means that the
5.24municipality's position had a reasonable basis in law and fact, based on the totality of the
5.25circumstances before and during the litigation.
5.26 Sec. 7. [471.422] FEES AND EXPENSES; CIVIL ACTION INVOLVING
5.27MUNICIPALITY.
5.28(a) The court shall award fees and other expenses to a prevailing party in a civil
5.29action unless special circumstances make an award unjust, provided that:
5.30(1) the action is a civil action other than a tort action;
5.31(2) the municipality's orders or total cost of compliance with the orders is in an
5.32amount of $10,000 or more;
5.33(3) the prevailing party is not the municipality; and
5.34(4) the position of the municipality was not substantially justified.
6.1(b) If, in a civil action arising from an agency action to enforce a party's compliance
6.2with a statutory, regulatory, or ordinance requirement, the demand by the municipality is
6.3substantially in excess of the decision of the court and is unreasonable when compared
6.4with such decision under the facts and circumstances of the case, the court shall award to
6.5the party the fees and other expenses related to defending against the excessive demand,
6.6unless the party has committed a willful violation of law or engaged in conduct that
6.7unduly and unreasonably protracted the final resolution of the matter in controversy, or
6.8special circumstances make an award unjust.
6.9 Sec. 8. [471.423] PAYMENT OF COSTS AND FEES.
6.10A judgment against a municipality in a civil action for fees and expenses under
6.11section 471.422 must be paid from funds of the municipality.
6.12 Sec. 9. TITLE.
6.13This act may be cited as the "Small Business Bill of Rights - Regulatory Fairness
6.14Act."
6.15 Sec. 10. EFFECTIVE DATE; APPLICATION.
6.16This act is effective August 1, 2011, and applies to administrative or civil actions
6.17commenced on or after that date.
