State grant program appropriations modification

A bill for an act

relating to higher education; modifying appropriations for the state grant program;

amending Minnesota Statutes 2024, section 136A.121, subdivision 3, by adding

a subdivision; repealing Minnesota Statutes 2025 Supplement, section 136A.121,

subdivisions 7, 7a.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 136A.121, subdivision 3, is amended to read:

Subd. 3.

Allocation.

Grants must be awarded
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on a funds available basis
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to those applicants

who meet the office's requirements.

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EFFECTIVE DATE.

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This section is effective July 1, 2026.

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Sec. 2.

Minnesota Statutes 2024, section 136A.121, is amended by adding a subdivision

to read:

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Subd. 22.

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Appropriation.

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The amount necessary to meet the need for state grants under

this section is appropriated annually from the general fund to the commissioner of the Office

of Higher Education.

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EFFECTIVE DATE.

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This section is effective July 1, 2026.

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Sec. 3.
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REPEALER.
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Minnesota Statutes 2025 Supplement, section 136A.121, subdivisions 7 and 7a,

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are

repealed.

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EFFECTIVE DATE.

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This section is effective July 1, 2026.

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APPENDIX

Repealed Minnesota Statutes: 26-08236

136A.121 STATE GRANT PROGRAM.

Subd. 7.

Insufficient appropriation.

(a) If the amount appropriated is determined by the office to be insufficient to make full awards to applicants under subdivision 5, awards must be reduced by:

(1) adding a surcharge to the applicant's assigned family responsibility, as defined in section
136A.101, subdivision 5a
; and

(2) a percentage increase in the applicant's assigned student responsibility, as defined in subdivision 5.

(b) The reduction under paragraph (a), clauses (1) and (2), must be equal dollar amounts. The total assigned family responsibility after the addition of the surcharge may exceed 100 percent of the parental or student contribution, as applicable, assigned by the federal needs analysis. The commissioner must not adjust the surcharge under paragraph (a), clause (1), according to the student's status as a dependent student, an independent student with dependents other than a spouse, or an independent student without dependents other than a spouse.

Subd. 7a.

Surplus appropriation.

(a) If the amount appropriated is determined by the office to be more than sufficient to fund projected grant demand in the second year of the biennium, the office may:

(1) increase the living and miscellaneous expense allowance in the second year of the biennium by up to an amount that retains sufficient appropriations to fund the projected grant demand; or

(2) when calculating assigned family responsibility, recognize a negative parental contribution or student contribution that is less than negative $1,500 to a value that is equal to the lowest student contribution provided under the federal needs analysis.

(b) The adjustments in paragraph (a) may be made one or more times. In making the determination that there are more than sufficient funds, the office shall balance the need for sufficient resources to meet the projected demand for grants with the goal of fully allocating the appropriation for state grants. An increase in the living and miscellaneous expense allowance or a modified assigned family responsibility under this subdivision does not carry forward into a subsequent biennium.