1.1 	A bill for an act
1.2 	relating to transportation; authorizing cities to impose a transportation utility fee; 
1.3 	proposing coding for new law in Minnesota Statutes, chapter 275.
1.4 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.5 	Section 1. [275.084] TRANSPORTATION UTILITY FEE.
1.6 		Subdivision 1.Definitions. For the purposes of this section, the following terms 
1.7 	have the meanings given.
1.8 	(a) "Facility upgrade" means traffic signals, turn lanes, medians, street approaches, 
1.9 	alleys, rights-of-way, sidewalks, retaining walls, fence installation, and additional traffic 
1.10 	lanes.
1.11 	(b) "Governing body" means the city council of a municipality.
1.12 	(c) "Maintenance" means striping, seal coating, crack sealing, sidewalk maintenance, 
1.13 	signal maintenance, street light maintenance, and signage.
1.14 	(d) "Municipality" means a home rule charter or statutory city.
1.15 	(e) "Reconstruction" means paving, grading, curbs and gutters, bridge repair, 
1.16 	overlays, drainage, base work, subgrade corrections, and boulevard restoration.
1.17 		Subd. 2.Authorization. A municipality may impose the transportation utility 
1.18 	fee provided in this section against land located within its boundaries.  The fee must be 
1.19 	set at a level that neither significantly overrecovers nor underrecovers costs, including 
1.20 	overhead costs, involved in reconstructions, facility upgrades, and maintenance described 
1.21 	in the master plan.
1.22 		Subd. 3.Procedures for adoption. A municipality may impose the transportation 
1.23 	utility fee provided in this section by ordinance adopted by a two-thirds vote of its 
1.24 	governing body.  The resolution must not be voted on or adopted and the municipality 
2.1 	may not contract for any improvement until after a public hearing has been held on the 
2.2 	question.  A notice of the time, place, and purpose of the hearing, including the general 
2.3 	nature of the improvement, its estimated costs, and the area against which the fee is 
2.4 	proposed to be assessed, must be published at least once in each week for two successive 
2.5 	weeks in the official newspaper of the municipality, or in a newspaper of general content 
2.6 	and circulation within the municipality, and the last notice must be published at least seven 
2.7 	days prior to the hearing.  The municipality must file the adopted ordinance of record with 
2.8 	the county recorder, and the municipality must provide a copy to the county auditor.
2.9 		Subd. 4.Collection. The ordinance adopted under this section must provide for the 
2.10 	billing and payment of the fee on a monthly, quarterly, or other basis as directed by the 
2.11 	governing body.  Fees that, as of October 15 each calendar year, have remained unpaid 
2.12 	for at least 30 days must be certified to the county auditor for collection as a special 
2.13 	assessment payable in the following calendar year against the affected property.
2.14 		Subd. 5.Master plan requirement. A municipality may not impose the fee 
2.15 	provided in this section unless it has prepared and adopted a master plan that includes 
2.16 	information on the proposed reconstruction, facility upgrade, and maintenance for the 
2.17 	following five years.  A capital improvement plan, public facility plan, or comparable 
2.18 	information qualifies as a master plan.  The master plan must include information on 
2.19 	the proposed funding sources for all projects required to be included in the plan.  The 
2.20 	master plan must be adopted by resolution of the governing body following a hearing and 
2.21 	publication of notice of the hearing, as provided in subdivision 3.
2.22 		Subd. 6.Use of proceeds. Revenues from the fee authorized in this section may 
2.23 	only be used for specific projects listed in the master plan and are limited to projected 
2.24 	costs of the needs approved in the master plan and described in the published notice before 
2.25 	the required public hearing.  The municipality may not accumulate revenues from the fee 
2.26 	beyond the estimated costs for reconstructions, facility upgrades, and maintenance that 
2.27 	are described in the master plan.
2.28 		Subd. 7.Calculation of fee. The fee imposed must be calculated based on the 
2.29 	relationship of the revenues the municipality proposes to generate and the relative benefit, 
2.30 	as determined by the municipality, that will accrue to each category of land use from the 
2.31 	projects to be financed.  The amount of revenue the municipality proposes to generate must 
2.32 	be that amount reasonable and necessary to complete the proposed improvement.  The fee 
2.33 	may be imposed only against property that will benefit by the improvement, whether or 
2.34 	not the property abuts the improvement.
2.35 		Subd. 8.Appeals. A property owner may administratively appeal the amount of 
2.36 	the fee to the governing body within 60 days after notice of the amount of fee due has 
3.1 	been mailed to the property owner.  The appeal must be in writing, signed, and dated by 
3.2 	the property owner, and must state the reasons why the amount of the fee is incorrect. 
3.3 	The appeal may state reasons why the fee imposed by the municipality generates funds 
3.4 	in excess of the amount reasonable and necessary for the improvement described in the 
3.5 	published notice, or why the property against which the fee is imposed does not benefit 
3.6 	from the proposed improvement.  The decision of the governing body may be appealed to 
3.7 	the Tax Court in the same manner as appeals of determinations regarding property tax 
3.8 	matters provided for in chapter 271.  If the governing body does not make a decision 
3.9 	within six months after the filing of an administrative appeal, the property owner may elect 
3.10 	to appeal to the Tax Court.  The appeal procedures in this subdivision are in lieu of any 
3.11 	appeal procedures relating to special assessments provided for in chapter 429.
3.12 		Subd. 9.Special assessments; bonds; property tax levies. The use of the 
3.13 	transportation utility fee by a municipality does not restrict the municipality from 
3.14 	imposing special assessments, issuing bond debt, or levying property taxes to pay the costs 
3.15 	of local street reconstruction, facility upgrades, or maintenance.

3.16 	EFFECTIVE DATE. This section is effective the day following final enactment 
3.17 	for fees payable in 2006 and thereafter.