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II~Lfllm~I~11~~11111111As Part of an Ongoing Digital Archiving Project This document is made available electronically by the Minnesota Legislative Reference Library 1111111~!iln~'~~II~lfllm~I~11~~11111111as part of an ongoing digital archiving project. http://www.leg.state.mn.us/lrl/lrl.asp 3 0307 00022 0700 04 - 0525 STATE OF MINNESOTA OFFICE OF THE ATTORNEY GENERAL ANNUAL REPORT REQUIRED BY Minnesota Statutes Sections 8.08 and 8.15, Subdivision 4 (2002) Fiscal Year 2004 Minn. Stat. 8.0$ Minn. Stat. 8.15 Subd. 4 • TABLE OF CONTENTS • INTRODUCTION 1 GOVERNMENT OPERATIONS SECTION . 2 Human Rights/Labor/Corrections Division . 2 Human Services Division . 4 • Public Finance/Agriculture/Natural Resources Division . 5 Telecommunications and Energy Division .. 10 Transportation Division .. 12 GOVERNMENT REGULATION SECTION . 14 • Environmental Protection Division .. 14 Health and Antitrust Division .. 16 Health Licensing Division . 20 Health Licensing Investigations Division .. 21 • Residential Utilities Division . 21 GOVERNMENT SERVICES SECTION . 23 Civil Litigation Division . 23 Education Division . 25 Medicaid Fraud Division . 28 • Tax Litigation Division . 29 SOLICITOR GENERAL SECTION ; . 31 Appeals Division . 31 Charities Division . 31 Consumer Enforcement and Services Divisions .. 34 • Commerce Division '" . 36 Public Safety/Gambling Division . 38 Trial Division .. 39 • APPENDIX A: Expenditures . A-I APPENDIX B: Special Attorney Expenditures ;... B-1 • AG: #I295312-vI • • • INTRODUCTION This report is intended to fulfill the requirements ofMinnesota Statutes Sections 8.08 and • 8.15, Subdivision 4, for Fiscal Year 2004 (FY 04). The Attorney General's Office (AGO) is organized into four sections under the direction of deputy attorneys general: Government Operations, Government Regulation, Government Services and Solicitor General. This report contains brief summaries ofthe services provided to • state agencies and other AGO clients by these sections. • • • • • • • • 1 • GOVERNMENT OPERATIONS SECTION • HUMAN RIGHTSILABORICORRECTIONS DIVISION The Human Rights/Labor/Corrections/Collections Division represents the Departments of Human Rights, Labor and Industry, Economic Security, and Veteran's Affairs as well as the Bureau of Mediation Services, Public Employee Retirement Association, Minnesota State • Retirement System, Teacher's Retirement Association, Department of Corrections, Veteran's Home Board, and the Insurance Division ofthe Department ofEmployee Relations. The division's major human rights activity is the handling of cases forwarded by the department following a determination that there is reason to believe illegal discriminatory conduct has occurred. The division participates in mediation regarding these matters and seeks • to obtain appropriate monetary and non-monetary relief. The division resolved 71 such cases in FY 04. The division's efforts resulted in Minnesota citizens receiving compensatory and injunctive relief for illegal discriminatory treatmenL In FY 04, the division obtained .compensatory relieffor Minnesota citizens in the amount ofapproximately $1,446,000. • In addition, the division work included: • Litigation and appellate work to preserve the resources of State funds and State pension funds for injured workers and disabled public employees. For example, in a matter involving the Special Compensation Fund of the Department of Labor and Industry, the • division recovered approximately $132,000 of fraudulently obtained worker's compensation benefits. • Mediation and litigation to enforce occupational safety and health standards, including cases regarding workplace fatalities. In FY 04, the division resolved 29 OSHA cases and • obtained about $70,000 in OSHA fines. • Participation in bankruptcy proceedings in order to protect the State's interest in collecting reemployment benefits overpayments. In the past fiscal year, the division prevented the discharge in bankruptcy ofapproximately $258,000 ofimproperly received • benefits. The division also provides legal services to the Department of Corrections and all state correctional facilities. These legal services include litigation and a variety of client advice matters. The division has successfully handled a high volume ofinmate lawsuits. • The division's commercial litigation and debt collection activities included: • Obtained court judgments for the state, based on debts owed to various state agencies for • overpayments, fees, loans, breach ofcontract, property damage, and fines; 2 • • • Protected the State's rights as a creditor in bankruptcies, receiverships, liquidations, and other such actions; • • Trained .and worked with State personnel on collection, financial, and bankruptcy matters; and • Represented the state's interests in probate court in escheat cases. • Examples of the division's work in bankruptcy matters included successful defense against efforts of steel companies to evade liability for taconite production tax assessments of almost $6,500,000 in 2004 and potentially of $20,000,000 to $30,000,000 in the future by obtaining bankruptcy courts' orders affirming that such liability had not been eradicated by bankruptcy court asset sales. The division also represented the Department of Human Services in Chapter 11 bankruptcy cases to enforce the agency's interest in recovering approximately • $340,000 in tax revenues. The division also provided legal advice to representatives of the Collections Division of the Minnesota Department of Revenue. Over the past fiscal year, the division's collection work resulted in recoveries and judgments ofmore than $2,000,000. • • • • • • 3 • • HUMAN SERVICES DIVISION The Ruman Services Division provides litigation counsel and comprehensive legal • services to the Minnesota Department of Ruman Services ("DRS"). The following describes some ofthe major areas in which the division provides legal services to DRS. Public Assistance Programs. Division attorneys advise DRS on the implementation of the Minnesota Family Investment Program (MFIP), General Assistance Program (GA), Minnesota Supplemental Assistance Program (MSA), Food Stamp Program, and Child Support • Enforcement Program. During FY 04, the division represented DRS in litigation challenging the agency's implementation of 2003 amendments to the MFIP statutes. The division also worked with the agency to address issues raised by advocacy groups, anticipate possible litigation, and resolve potential claims. • Child Support. Division attorneys provide litigation counsel and legal advice for DRS's Child Support Division. During FY 04, division attorneys defended the agency in litigation challenging the constitutionality of Minnesota child support statutes in Minnesota district and appellate courts. The division also assisted the agency in improving state and federal efforts to collect support from non-custodial parents. During FY 03, the agency collected $572 million in • child support, representing a 3-percent increase from 2002. Licensing. Division attorneys provide advice and litigation counsel to the DRS's Licensing Division, which is the lead agency for investigating alleged maltreatment in programs licensed to provide adult daycare and adult foster care, and programs providing services for • mental health, developmental disabilities, and chemical health, as well as personal care provider organizations. Division attorneys represent the' Licensing Division in its efforts to seek disqualification of individual health care providers and to pursue licensing enforcement actions in administrative forums and Minnesota courts. Division attorneys represented the agency in 54 licensing proceedings in FY04. • Health Care. Division attorneysprovide litigation counsel and client advice to DRS on a . broad range of health care issues and services, including Medical Assistance (Minnesota's Medicaid program), the MinnesotaCare program, and continuing care programs for the elderly and'persons with disabilities. Division attorneys also assist'the agency in the recovery of • payments for healthcare services from estates and from responsible third-parties. Several examples oflegal services provided in FY 04 are: • ARRM v. Goodno, et. al: Represented DRS in complex federal court litigation brought by one recipient and an organization of providers of waiver services for persons with mental retardation and related conditions ("MR/RC"). The lawsuit seeks declaratory and • injunctive relief and challenges the agency's' manner of funding county budgets for MRJRC waiver services. • Masterman/ARC v. Goodno, et. al: Represented DRS in a second large federal court • lawsuit, later consolidated with the ARRM lawsuit. This lawsuit, brought by several 4 • • recipients of MRJRC waiver services, asserts that the State's funding of MRJRC waiver services violates federal law. • • Nursing Homes: Division staffworked with Health Division attorneys in helping ensure the welfare and safety of nursing home residents whose facilities were facing closure or sale because ofprecarious or failing financial conditions. • Intervention cases: Division attorneys intervened in a large volume oftort recovery cases • in district courts throughout the State. During FY 04, the division assisted in collecting $5,863,317 for DHS in intervention cases. • Public Assistance appeals: Division attorneys represented DHS or assisted county attorneys in hundreds of public assistance appeals related to eligibility for Minnesota • health care and other public benefit programs; • Estate collections: Division attorneys assisted the agency in collecting $6.9 million for payment ofMedical
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