09.02 Resolution supporting Dedicated State Funding for City Streets

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,, i, i 2017 0 , 1-, LEAGUE OF MINNESOTA CITIES i, .1:: ,_ .;r CITY ISSUE ‘,_ ,.. .i .,,r ,,,tif ,-- ' w.. FACT SHEET i, , „. , . ...„, ---Ap..........._:-t- .„-..z.,---... DEDICATED STREET FUNDING FOR ECONOMICALLY COMPETITIVE CITIES PROBLEM: Even though city streets are Existing funding mechanisms for city street maintenance and essential to mobility and reconstruction are inadequate.The bulk of the 22,500-mile city street system is not eligible for Municipal State Aid (MSA), economic vitality in Minnesota a dedicated fund set up through the state constitution. In cities communities, funding for under 5,000 (non-MSA cities)dedicated funding sources for large infrastructure projects are needed so that cities can plan those streets has remained ahead and budget effectively. unaddressed in transportation funding bills for over a decade. BACKGROUND: City revenues and other funding tools are not keeping LEAGUE-SUPPORTED SOLUTION• pace with needs for municipal street maintenance, construction, and reconstruction. Currently, nearly 84 • $10 surcharge on license tab fees percent of city streets are funded only with property • $10 surcharge on motor vehicle title taxes and special assessments. transfers Special assessments can be onerous to property owners • Half of the funds raised (approx. $57 and are difficult to implement in some cities. Property taxes million annually) dedicated to the Small are generally not dedicated and are sometimes diverted to Cities Assistance Account established more pressing needs such as public safety,water quality, by the 2015 Legislature and cost participation in state and county highway projects. • Half dedicated to a Larger City Streets Just as the state has fallen behind in making & Bridges Account(to be established) transportation investments,some cities faced with budget challenges have made the difficult decision to hold off on scheduled street improvement projects, DID YOU KNOW? resulting in more expensive projects later. For every$1 spent on maintenance. a Preventative maintenance projects,such as seal road authority saves $7 in repairs. But this coating and overlays, can prolong the lifecycle maintenance requires a reliable dedicated of streets to 50 to 60 years. Without ongoing funding source other than the current maintenance,the average life expectancy of local volatile property tax system. streets is approximately 25 to 30 years. FOR MORE INFORMATION: e' iCl Anne Finn WWW.IMc.org/citystreetfacts LEAGUE OF Intergovernmental Relations Asst. Director MINNESOTA Phone: (651) 281-1263 CITIES Email: afinn@lmc.org ©2016 League of Minnesota Cities.All Rights Reserved.