DEPARTMENT: Transportation
FILE TYPE: Consent Action
TITLE
title
Request To Commissioner Of Transportation To Transfer Excess Municipal State Aid Construction Funds To Regular State Aid Construction Account
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PURPOSE/ACTION REQUESTED
Request that the Commissioner of Transportation transfer excess Municipal State Aid Construction Funds (Municipal Account) to the Regular State Aid Construction Account (Regular Account).
SUMMARY
Dakota County receives County State Aid Highway (CSAH) funds for highway construction projects. These funds are allocated to Dakota County’s Regular Account and Municipal Account. The Municipal Account can only be used for projects located in cities with a population of less than 5,000. Since funds in the Regular Account can be used on any CSAH route, transferring excess funds from the Municipal Account to the Regular Account would not jeopardize future projects in cities under 5,000. This action is routinely done to provide greater flexibility in the use of Dakota County’s CSAH funds and to prevent a reduction in State Aid funding received by the County.
The County State Aid Screening Board (Screening Board) is a board of designated county engineers appointed by the Commissioner of Transportation. The Screening Board recommends to the Commissioner of Transportation how State Aid funds are apportioned to each county. Local governments receive State Aid funds based on how much money they “need” to bring their highways up to standard. The Screening Board rules include a deduction in needs if the Municipal Account balance exceeds five years of apportionment. To avoid a reduction in “needs” and a corresponding funding reduction, State Aid rules allow a transfer of Municipal Account fund balance in excess of two years apportionment to the Regular account. The County’s current Municipal Account fund balance is $2,315,012. The Municipal Account apportionment was $422,613 in 2023 and $467,399 in 2024. To prevent a reduction of the 2025 State Aid apportionment, Dakota County may, therefore, reduce the Municipal Account fund balance by up to $1,425,000, which would leave a balance equal to two years’ apportionment ($890,012).
RECOMMENDATION
recommendation
Staff recommends the County Board request the Commissioner of Transportation transfer $1,425,000 from Dakota County’s Municipal Account to the Regular Account.
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EXPLANATION OF FISCAL/FTE IMPACTS
The transfer will increase the amount of Regular Account available to the County by $1,425,000 and reduce the Municipal Account balance by $1,425,000. This transfer has no impact on the County Manager’s Recommended 2025 Transportation Operating or Capital Improvement Program budgets.
☐ None ☐ Current budget ☒ Other
☐ Amendment Requested ☐ New FTE(s) requested
RESOLUTION
body
WHEREAS, Dakota County receives County State Aid Highway (CSAH) funds for construction that are allocated to a Regular State Aid Construction Account (Regular Account) and Municipal State Aid Construction Account (Municipal Account); and
WHEREAS, Regular Account funds can be used on any CSAH route, including CSAH routes in cities with a population less than 5,000, and Municipal Account funds can only be used for projects in cities with a population less than 5,000; and
WHEREAS, rules of the County State Aid Screening Board, a board of designated county engineers appointed by the Commissioner of Transportation, include a deduction in needs that will result in a reduction in the 2025 State Aid apportionment; and
WHEREAS, Minn. Stat. § 162.08, subd. 4 (d) provides that accumulated balances in excess of two years of Municipal Account apportionments may be spent on projects located outside of municipalities with populations under 5,000 when approved by resolution of the County Board; and
WHEREAS, since funds in the Regular Account can be used on any County State Aid Route, potential future projects in cities under 5,000 are not jeopardized; and
WHEREAS, a transfer of Municipal Account funds exceeding the last two years of apportionment to the Regular Account is necessary to avoid a reduction in needs.
NOW, THEREFORE, BE IT RESOLVED, That the Dakota County Board of Commissioners hereby requests that the Commissioner of Transportation transfer $1,425,000 of Dakota County Municipal Account funds, an amount equal to all funds in excess of a two years’ apportionment to the Municipal Account, into its Regular Account.
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PREVIOUS BOARD ACTION
None.
ATTACHMENTS
None.
BOARD GOALS
☐ A Great Place to Live ☐ A Healthy Environment
☒ A Successful Place for Business and Jobs ☐ Excellence in Public Service
CONTACT
Department Head: Erin Laberee
Author: Jake Chapek