7.3. SR 02-19-2008/j
Elk REQUEST FOR ACTION
River
To Item Number
Ci Council 7.3.
Agenda Section Meeting Date Prepared by
Administration Februa 19, 2008 Lori ohnson, Ci Administrator
Item Description Reviewed by
Consider League of Minnesota Cities Resolution Requesting
Comprehensive Road and Transit Funding Reviewed by
Action Requested
Review a resolution requesting comprehensive road and transit funding drafted by the League of
Minnesota Cities. The resolution should be modified as desired to reflect the Council's views prior to
adoption.
Background/Discussion
This resolution was distributed to the Council at last week's work session and is back on the agenda for
consideration. Transportation funding is an important issue for the City, particularly because of the major
improvements needed to the two trunk highways that run through Elk River. These are very high priority
projects for the City and obviously should not and can not be funded entirely by Elk River residents. The
only way to fund them is through changes in transportation funding and participation by the state and
federal governments.
The League's resolution includes many options for transportation funding; however, the Council may
want to change these and also add specific language about Elk River's unique need for funding of state
highways.
Financial Impact
None
Attachments
^ Resolution Requesting Comprehensive Road and Transit Funding
^ League of Minnesota Cities 2008 Transportation Funding Policy Statement
^ E-mail from Jim Miller, Executive Director, League of Minnesota Cities
Action Motion by Second by Vote
Follow Up
S:\Council\Lori\2[108\League Resolution Requesting Comprehensive Road and Transit Funding.doc
RESOLUTION NO. 08-
CITY OF ELK RIVER
A RESOLUTION REQUESTING COMPREHENSIVE ROAD AND TRANSIT
FUNDING
WHEREAS, all Minnesota communities benefit from a sound, efficient and adequately funded
transportation system that offers diverse modes of travel; and
WHEREAS, the integrity of Minnesota's transportation infrastructure is dependent upon long-
term planning and ongoing maintenance, both of which require dedicated and sustainable revenue
sources; and
WHEREAS, Minnesota leaders have not increased dedicated funding levels for roads, bridges and
transit systems to keep pace with growing costs and changing needs; and
WHEREAS, transportation analysts in consultation with the Minnesota Department of
Transportation (MnDOT) estimate Minnesota will have to invest an additional $1.5 billion per year
in transportation infrastructure for the next ten years in order to meet identified needs on
Minnesota's state highways and bridges, county roads, city streets, metro and rural transit systems
and local bridges; and
WHEREAS, Minnesota's transportation system is failing to meet the capacity needs necessary
to sustain population growth and promote economic development; and
WHEREAS, congestion, inefficient transportation systems and lack of transportation choices
lead to greater dependence on foreign oil, increased environmental degradation, and economic
disadvantages for Minnesota's businesses and residents; and
WHEREAS, many rural roads are not built to modern safety standards and are not meeting the
needs of industries that depend on the ability to transport heavy loads; and
WHEREAS, local cost participation requirements for trunk highway and county projects are
onerous and are contributing to strains on city budgets; and
WHEREAS, transportation infrastructure maintenance and improvement costs significantly
contribute to rising property taxes; and
WHEREAS, insufficient state funding has delayed regionally significant road construction and
reconstruction projects across Minnesota; and
WHEREAS, current funding for roads, bridges and transit systems across all government levels
in Minnesota is inadequate, and this under-investment diminishes quality of life for Minnesota
residents and hinders Minnesota's progress as a national business, economic and civic leader.
NOW, THEREFORE, BE IT RESOLVED that the Ciry Council of the Ciry of Elk River, that
this Council requests that the Minnesota Legislature pass a comprehensive and balanced
transportation funding package that permanently increases dedicated funding for transportation; and
BE IT FURTHER RESOLVED that this Council requests that Governor Tim Pawlenty allow a
comprehensive and balanced transportation funding package that permanently increases dedicated
funding for transportation that is passed by the Legislature to become law; and
BE IT FURTHER RESOLVED that this Council requests that a comprehensive and balanced
transportation funding package be based upon multiple revenue sources, which may include but not
be limited to general obligation and trunk highway bonds; and
BE IT FURTHER RESOLVED that this Council supports funding options including, but not
limited to, the following:
• An increase in the gas tax;
• Indexing of the gas tax, provided there is a limit on how much the tax can be increased for
inflation in a given amount of time;
• Increases in vehicle registration taxes (a.k.a. license tab fees);
• Trunk highway bonding, provided the Legislature implements reasonable restrictions on the
amount of debt service the state will incur and provided the Legislature appropriates funding
to assist with local costs related to projects funded with trunk highway bonds;
• General obligation bonding for local roads and bridges, particularly for roads of regional
significance and to assist with local cost participation requirements pertaining to trunk
highway projects;
• Sales tax exemptions for state and local transportation construction projects; and
• New local funding tools, such as local option sales tax authority or authority to establish
street improvement districts; and
BE IT FURTHER RESOLVED that this Council defines a comprehensive and balanced
transportation funding package as an initiative that permanently increases dedicated funding for state
and local road and transit systems in Greater Minnesota and the Metropolitan Area.
Passed and adopted by the City Council of the City of Elk River this 19~' day of February, 2008.
Stephanie A. Klinzing, Mayor
ATTEST:
Tina Allard, Ciry Clerk
League of Minnesota Cities 2008 Transportation Funding Policy Statement
Issue: The League of Minnesota Cities recognizes that all Minnesota residents and businesses
benefit from a sound transportation system that offers diverse modes of travel. Current funding for
roads, bridges and transit systems across all government levels in the state is inadequate, and
Minnesota's transportation system is failing to meet needs pertaining to public safety, population
growth and economic development.
Due to funding challenges, the state has delayed regionally significant road construction and
reconstruction projects. Urban areas are experiencing growing congestion and are lagging behind
other regions in making transit investments. Rural roads are not being upgraded to meet modern
safety standards and are not serving the needs of industries that depend on the ability to transport
heavy loads.
Local roads, bridges, sidewalks and trails are critical components of Minnesota's transportation
infrastructure. Cities, like the state, have inadequate resources to preserve and reconstruct aging
transportation infrastructure, and to build transportation infrastructure to serve new development.
Existing funding mechanisms such as municipal state aid (MSA), special assessments and bonding
have limited applications, making it difficult for cities to address growing needs.
Further, as the state funding shortfall has grown, the trunk highway project cost participation
requirements imposed on local units of government have increased dramatically. This burden has
been exacerbated by the state's use of trunk highway bonds as a funding source, because under
Minnesota's constitution, trunk highway bond dollars cannot be spent on local components of trunk
highway projects, and the bond dollars are not distributed through the Highway User Tax
Distribution Fund formula. Cost participation requirements put added pressure on local budgets,
contribute to property tax increases and divert local resources from the over 39,000 lane miles in
Minnesota under municipal jurisdiction.
Response: More resources must be dedicated to all components of the state's transportation
system, and local units of government must have access to resources and funding tools to
meet growing needs. The League of Minnesota Cities supports the following:
• acceleration of the phase-in of the constitutional dedication of 100 percent of the
motor vehicle sales tax (MUST) to transportation purposes;
• MVST distribution of 60 percent for roads and bridges, and 40 percent for transit;
• dedication of the sales tax on leased vehicles to transportation purposes;
• a permanent increase in the gas tax;
• indexing of the gas tax, provided there is a limit on how much the tax can be
increased for inflation in a given amount of time;
• increases in vehicle registration taxes (tab fees);
• trunk highway bonding, provided the Legislature implements reasonable restrictions
on the amount of debt service the state will incur, and provided the Legislature
appropriates funding to assist with local costs related to projects funded with trunk
highway bonds;
• general obligation bonding for local roads and bridges, particularly for routes of
regional significance;
• a sales tax increase to fund transportation needs;
S:\Council\Lori\2008\League Resolution Requesting Comprehensive Road and Transit Funding.doc
• funding to assist cities burdened by cost participation responsibilities imposed by
improvement projects on the state's principal arterial system and on the county state
aid highway (CSAH) system;
• funding for transportation components of economic development and
redevelopment projects of regional significance;
• full funding for all components of state highway projects, including related
stormwater management systems, through state sources;
• funding to build roads to standards that can accommodate the year-round transport
of heavy loads;
• a sales tax exemption for materials purchased for state and local road, bridge,
sidewalk, trail and transit construction projects;
• authority for cities to impose development impact fees; and
• local funding options that would allow cities to raise revenues for roads, bridges,
sidewalks, trails and transit.
Adopted by League of Minnesota Cities Board of Directory on November 29, 2007.
Contact.• Anne Finn, Assistant Intergovernmental Relations Director, 651-281-1263 ore-mail a finn~lmc. ord.
S:\Council\Lori\2008\League Resolution Requesting Comprehensive Road and Transit Funding.doc
TO: League of Minnesota Cities Members
FROM: Jim Miller, Executive Director
SUBJECT: Transportation Resolution
You may have received a copy of a resolution from House Minority Leader Marty Seifert
(R-Marshall) seeking support for the Governor's bonding proposal, which includes $225
million for local bridges and $30 million for local roads.
Although the Governor's bonding proposal, which is supported by the Seifert resolution,
addresses a piece of the overall transportation funding need in the state, it is not a long-
term and comprehensive solution for our state and local transportation infrastructure
needs. We are concerned that adopting that resolution as presented may be
misinterpreted; that bonding alone represents an adequate response to transportation
funding needs.
Therefore, based upon the League's longstanding comprehensive transportation
funding policy statement, the League is offering the attached draft resolution as an
alternative to the Seifert resolution. The League's resolution acknowledges and
supports a more comprehensive approach to transportation funding, which includes, but
is not limited to bonding. Given the importance of transportation funding and the
likelihood that this will be a prominent issue in the upcoming legislative session, the
League urges your city to pass this or substantially similar resolution and to convey that
support to your legislators.
To maximize the impact of this resolution, please send copies of your adopted council
resolution to:
o Governor Tim Pawlenty: Office of the Governor, 130 State Capitol, 75
Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155.
o Your legislators (find at: www.leg.state.mn.us).
o Lynn Peterson: Intergovernmental Relations Assistant, League of
Minnesota Cities, 145 University Ave. W., St. Paul, MN 55103; E-mail:
Ipeterson(a~lmc.org.
If you have any questions, or would like further information, please contact Anne Finn,
Assistant Intergovernmental Relations Director, at 651-281-1263 or a-mail
afinn _Imc.orq.
S:\Council\Lori\2008\League Resolution Requesting Comprehensive Road and Transit Funding.doc