HF 5114

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/21/2024 02:31pm

A bill for an act
relating to local government; authorizing several financing mechanisms for local
governments to pay for transportation infrastructure; proposing coding for new
law in Minnesota Statutes, chapter 429.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [429.40] TRANSPORTATION INFRASTRUCTURE.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the following terms have
the meanings given.
new text end

new text begin (b) "Local government" means a home rule charter or statutory city, a town, or a county.
new text end

new text begin (c) "Transportation infrastructure" or "infrastructure" means a publicly owned
improvement that serves the purpose of facilitating vehicular traffic, including improvements
intended for public transit.
new text end

new text begin Subd. 2. new text end

new text begin Authorization. new text end

new text begin A local government may build, construct, reconstruct, repair,
enlarge, improve, maintain, or in any other manner obtain transportation infrastructure and
acquire by gift, purchase, lease, condemnation, or otherwise any and all land and easements
required for that purpose. The authority hereby granted is in addition to all other powers
with reference to the transportation infrastructure otherwise granted by the laws of this state
or by the charter of any local government.
new text end

new text begin Subd. 3. new text end

new text begin Financing. new text end

new text begin (a) For the purpose of paying the cost of building, constructing,
reconstructing, repairing, enlarging, improving, maintaining, or in any other manner obtaining
transportation infrastructure, a local government may:
new text end

new text begin (1) issue and sell its general obligations, which may be made payable primarily from
taxes or from special assessments to be levied to pay the cost of the transportation
infrastructure or from net revenues derived from charges authorized in this section or from
other nontax revenues pledged for their payment under charter or other statutory authority,
or from two or more of the sources; or
new text end

new text begin (2) issue special obligations, payable solely from taxes or special assessments or from
revenues, or from two or more of the sources.
new text end

new text begin (b) Real estate tax revenues may be used, and then on a temporary basis, to pay general
or special obligations only when the other revenues are insufficient to meet the obligations.
All obligations must be issued and sold in accordance with chapter 475.
new text end

new text begin (c) When special assessments are pledged for the payment of the obligations, they must
be authorized and issued in accordance with the provisions of this chapter, or of the local
government's charter if it authorizes these obligations and the local government determines
to proceed under the charter.
new text end

new text begin (d) When net revenues from charges are pledged to the payment of the obligations,
together with or apart from taxes and special assessments, the pledge must be made in
accordance with the provisions of subdivision 4.
new text end

new text begin Subd. 4. new text end

new text begin Transportation infrastructure charges; net revenues. new text end

new text begin (a) A local government
may impose just and equitable charges by ordinance against property abutting transportation
infrastructure to pay for the construction, reconstruction, repair, enlargement, improvement,
maintenance, or other obtainment of the infrastructure.
new text end

new text begin (b) The ordinance must specify the formula by which the costs of the transportation
infrastructure will be apportioned. The formula for determining the charges must provide
for credits offsetting part or all of the charges that reflect what new property development
may contribute in the form of taxes, other fees, dedications, or other contributions toward
transportation infrastructure.
new text end

new text begin (c) The charges may be fixed:
new text end

new text begin (1) by property classification;
new text end

new text begin (2) by reference to the square footage of the property charged; or
new text end

new text begin (3) on any other equitable basis, including any combination of equitable bases in this
subdivision.
new text end

new text begin Subd. 5. new text end

new text begin Who may be charged; unpaid charges. new text end

new text begin The local government may make the
charges a charge against the property owner, lessee, occupant, or all of them, and may
provide and covenant for certifying unpaid charges to the county auditor with taxes against
the property served for collection as other taxes are collected.
new text end

new text begin Subd. 6. new text end

new text begin Tax levies for public charges. new text end

new text begin The local government may fix and levy taxes
for the payment of reasonable charges to the local government itself for the use and
availability of the transportation infrastructure for emergency services and public transit.
new text end

new text begin Subd. 7. new text end

new text begin Reasonableness of charges. new text end

new text begin In determining the reasonableness of the charges
to be imposed, the local government may give consideration to all costs of the establishment,
operation, maintenance, depreciation and necessary replacement of the transportation
infrastructure, and of improvements, enlargements, and extensions necessary to adequately
serve the territory of the local government, including the principal and interest to become
due on obligations issued or to be issued and the costs of obtaining and complying with
permits required by law.
new text end

new text begin Subd. 8. new text end

new text begin Collections first for current costs. new text end

new text begin All charges, when collected, must be placed
in a separate fund and used first to pay the normal, reasonable, and current costs of
maintaining the transportation infrastructure.
new text end

new text begin Subd. 9. new text end

new text begin Excess net revenues may be used for debt. new text end

new text begin The net revenues received in
excess of the costs may be pledged by resolutions of the local government or may be used,
though not so pledged, for the payment of principal and interest on obligations issued as
provided in subdivision 3 or to pay the portion of the principal and interest as may be directed
in the resolutions.
new text end

new text begin Subd. 10. new text end

new text begin Covenants to secure debt payments. new text end

new text begin In resolutions authorizing the issuance
of either general or special obligations, the governing body may make covenants for the
protection of holders of the obligations and taxpayers of the local government as it deems
necessary, including but not limited to a covenant that the local government will impose
and collect charges of the nature authorized by this section at the times and in the amounts
required to produce, together with any taxes or special assessments designated as a primary
source of payment of the obligations, net revenues adequate to pay all principal and interest
when due on the obligations and to create and maintain reserves securing the payments as
may be provided in the resolutions.
new text end

new text begin Subd. 11. new text end

new text begin Enforceability of covenant. new text end

new text begin When a covenant is made it is enforceable by
appropriate action on the part of any holder of the obligations or any taxpayer of the local
government in a court of competent jurisdiction, and the obligations are deemed to be
payable wholly from the income of the system whose revenues are so pledged, within the
meaning of sections 475.51 and 475.58.
new text end

new text begin Subd. 12. new text end

new text begin Levy assessments. new text end

new text begin The local government may levy assessments against
property with the local government limits benefited by the transportation infrastructure
under the procedure authorized by law or charter with reference to other assessments for
benefits of local improvements, may transfer and use for the purposes hereof surplus funds
of the local government not specifically dedicated to another purpose, and may levy taxes
on property within the local government limits for the purposes.
new text end