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Legislative Audit Commission


June 26, 2003

Members present:

Representative Lyndon Carlson Senator Richard Cohen
Representative Jeff Johnson Senator David Hann
Representative Dan Larson Senator Sheila Kiscaden
Representative Connie Ruth Senator Tom Neuville
Representative Tim Wilkin Senator Ann Rest
Senator JimVickerman

Members absent:

Representative Sondra Erickson Senator Claire Robling
Representative Aaron Peterson Senator Yvonne Prettner Solon
Representative Paul Thissen


A meeting of the Legislative Audit Commission was called to order at 9:10 AM by Representative Tim Wilkin, Chairperson. The purpose of the meeting was to continue discussion concerning the Department of Commerce’s settlement with American Bankers Insurance, and for representatives of the Department of Commerce to give testimony. Chair Wilkin recognized James Nobles, Legislative Auditor, and Claudia Gudvangen, Deputy Legislative Auditor for the Financial Audit Division.

Mr. Nobles reported that Tim Thornton, attorney representing American Bankers Insurance, and Ron Jerich, lobbyist for American Bankers Insurance, declined to submit to further questions with regard to this settlement, and several Commission members expressed disappointment in that. Mr. Nobles then answered questions from Commission members.

Chair Wilkin asked Glenn Wilson, Commissioner of the Department of Commerce, to come forward; Mr. Wilson introduced Mr. Kelly, his legal counsel. Other Department of Commerce staff giving testimony were Gary Lavasseur, Director of Enforcement for the Commerce Department, and Patrick Nelson, Deputy Commissioner. Copies of a March 22, 2003 memo from Mr. Lavasseur to Mr. Wilson, regarding reporting actions to the National Association of Insurance Commissioners (NAIC), were made available to those in attendance. Commerce Department staff answered questions directed to them by Commission members.

Several Commission members expressed concern that there is no clear resolution to the differences in testimony from the Department of Commerce staff and that of Attorney General Mike Hatch with regard to this investigation. Representative Wilkin recessed the meeting at 11:20 AM, requesting any further questions be directed to the Department of Commerce and/or Attorney General Hatch.

At 1:35 PM, the Legislative Audit Commission meeting was reconvened by Chair Wilkin.

The following Commission members were present:

Representative Lyndon Carlson Senator Sheila Kiscaden
Representative Dan Larson Senator Tom Neuville
Representative Connie Ruth Senator Ann Rest
Representative Paul Thissen
Representative Tim Wilkin


The planned agenda for this part of the meeting included reviews of the program evaluation report, Charter School Financial Accountability, and the best practices report, Preserving Existing Housing.

Representative Wilkin recognized James Nobles, Legislative Auditor, who gave a brief overview of the charter school report, and then introduced Deborah Parker Junod, project manager, and project team members, Jan Sandberg and David Chein.

Ms. Junod made a slide presentation regarding charter schools, mentioning background, statistics, findings, and recommendations that were sited in the report. She also answered questions from members of the Commission.

Several Department of Education employees were introduced: Chas Anderson, Assistant Commissioner of the Office of Finance and Administrative Services; Tom Melcher, Director of Program Finance; Morgan Brown, Director of the Choice and Innovation Division; and Jim Bartholomew, Director of Governmental Relations. They gave comments regarding the report and responded to concerns and questions directed to them by the Commission. Ms. Anderson provided a printout of the department’s training series for charter schools.

Mr. Nobles noted the report shows that the Legislature needs to further clarify the role of charter school sponsors with regard to financial management and oversight issues.

It was determined that, for lack of time, the best practices report will be presented to the Legislative Audit Commission at a later date.

The meeting was adjourned at 3:00 PM.

Representative Tim Wilkin, Chair

Barbara Wing, Acting Recording Secretary


Office of the Legislative Auditor ♦ Room 140, 658 Cedar St., St. Paul, MN 55155