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Minnesota Legislature

Office of the Revisor of Statutes

SF 2816

as introduced - 91st Legislature (2019 - 2020) Posted on 04/11/2019 08:43am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to transportation; establishing a rail infrastructure and economic
development program; modifying rail-related accounts; making technical changes;
amending Minnesota Statutes 2018, sections 222.49; 222.50, subdivision 7; 222.57;
222.63, subdivision 8; proposing coding for new law in Minnesota Statutes, chapter
222.

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

Section 1.

Minnesota Statutes 2018, section 222.49, is amended to read:


222.49 RAIL SERVICE IMPROVEMENT ACCOUNTS; deleted text beginAPPROPRIATIONdeleted text endnew text begin
TRANSFERS
new text end.

(a) A rail service improvement account is created in the special revenue fund in the state
treasury. The account consists of funds as provided by law, and any other money donated,
allotted, transferred, or otherwise provided to the account, excluding bond proceeds as
authorized by article XI, section 5, clause (i), of the Minnesota Constitution. deleted text beginAll money so
deposited is appropriated to the department for expenditure for rail service improvement in
accordance with applicable state and federal law. This appropriation shall not lapse but shall
be available until the purpose for which it was appropriated has been accomplished.
deleted text endnew text begin Annually
by June 30, the commissioner of transportation must transfer the entire unencumbered
balance in the rail service improvement account in the special revenue fund to the rail
infrastructure account in the special revenue fund.
new text end

(b) A rail service improvement account is created in the bond proceeds fund. The account
consists of state bond proceeds appropriated to the commissioner. Money in the account
may only be expended for the purposes specified in section 222.50 that are permitted under
the Minnesota Constitution, article XI, section 5, clause (a) or (i).

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective June 30, 2019.
new text end

Sec. 2.

Minnesota Statutes 2018, section 222.50, subdivision 7, is amended to read:


Subd. 7.

Expenditures.

deleted text begin(a)deleted text end The commissioner may expend money from the rail service
improvement account for the following purposes:

(1) to make transfers as provided under section 222.57 or to pay interest adjustments on
loans guaranteed under the state rail user and rail carrier loan guarantee program;

(2) to pay a portion of the costs of capital improvement projects designed to improve
rail service of a rail user or a rail carrier;

(3) to pay a portion of the costs of rehabilitation projects designed to improve rail service
of a rail user or a rail carrier;

(4) to acquire, maintain, manage, and dispose of railroad right-of-way pursuant to the
state rail bank program;

(5) to provide for aerial photography survey of proposed and abandoned railroad tracks
for the purpose of recording and reestablishing by analytical triangulation the existing
alignment of the inplace track;

(6) to pay a portion of the costs of acquiring a rail line by a regional railroad authority
established pursuant to chapter 398A;

(7) to pay the state matching portion of federal grants for rail-highway grade crossing
improvement projects;

deleted text begin (8) for expenditures made before July 1, 2017, to pay the state matching portion of grants
under the federal Transportation Investment Generating Economic Recovery (TIGER)
program of the United States Department of Transportation;
deleted text end

deleted text begin (9)deleted text endnew text begin (8)new text end to fund rail planning studies; and

deleted text begin (10)deleted text endnew text begin (9)new text end to pay a portion of the costs of capital improvement projects designed to improve
capacity or safety at rail yards.

deleted text begin (b) All money derived by the commissioner from the disposition of railroad right-of-way
or of any other property acquired pursuant to sections 222.46 to 222.62 shall be deposited
in the rail service improvement account.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective June 30, 2019.
new text end

Sec. 3.

new text begin [222.505] RAIL INFRASTRUCTURE AND ECONOMIC DEVELOPMENT
PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Definition. new text end

new text begin For purposes of this section, "program" means the rail
infrastructure and economic development program established in this section.
new text end

new text begin Subd. 2. new text end

new text begin Program established. new text end

new text begin The commissioners of transportation and employment
and economic development must jointly establish a rail infrastructure and economic
development program as provided in this section.
new text end

new text begin Subd. 3. new text end

new text begin Rail infrastructure account; appropriation. new text end

new text begin (a) A rail infrastructure account
is established in the special revenue fund. The account consists of funds as provided in
paragraph (b) and in sections 222.49 and 222.63, subdivision 8, and any other money
donated, allotted, transferred, or otherwise provided to the account. The account must not
include any bond proceeds authorized by the Minnesota Constitution, article XI, section 5,
clause (i).
new text end

new text begin (b) All funds made available to the commissioner from the disposition of railroad
right-of-way or of any other property acquired pursuant to sections 222.46 to 222.62 must
be deposited in the rail infrastructure account.
new text end

new text begin (c) Funds in the account are annually appropriated to the commissioner of transportation
for financial assistance awards under this section. The commissioners of transportation and
employment and economic development are prohibited from expending funds from the
account for administrative costs.
new text end

new text begin Subd. 4. new text end

new text begin Program administration. new text end

new text begin (a) The commissioners of transportation and
employment and economic development must establish a project selection process for
financial assistance under the program, in consultation with interested stakeholders who
are eligible under subdivision 5 to receive financial assistance. The process must include
public notice of available funds, procedures to submit applications, publicly available
information on project evaluation and selection as provided in this section, and financial
assistance awards. The commissioners must ensure that the process minimizes applicant
burdens.
new text end

new text begin (b) The commissioners must maintain on an ongoing basis a project requests list that
identifies all eligible projects that have been evaluated for financial assistance under the
program.
new text end

new text begin (c) An applicant must apply for financial assistance in the manner and at the times
determined by the commissioners.
new text end

new text begin (d) The commissioners must make reasonable efforts to (1) publicize each solicitation
for applications among all eligible recipients, and (2) provide technical and informational
assistance related to applications.
new text end

new text begin Subd. 5. new text end

new text begin Award recipient eligibility. new text end

new text begin (a) Eligible recipients of financial assistance under
the program are:
new text end

new text begin (1) railroad companies that are classified by federal law or regulation as Class II railroads,
Class II rail carriers, Class III railroads, or Class III rail carriers;
new text end

new text begin (2) rail users; and
new text end

new text begin (3) political subdivisions.
new text end

new text begin (b) An eligible recipient may receive funds regardless of rail facility ownership.
new text end

new text begin Subd. 6. new text end

new text begin Project eligibility. new text end

new text begin (a) To be eligible under the program, a project must meet
one or more of the following:
new text end

new text begin (1) improve safety, efficiency, service, or capacity of railroad freight movement;
new text end

new text begin (2) provide for rail line capital maintenance, preservation, rehabilitation, or improvements;
new text end

new text begin (3) provide for economic development and job stability or growth of an area;
new text end

new text begin (4) maintain or improve rail trackage or facilities owned by a rail user, industrial park,
port, or political subdivision; or
new text end

new text begin (5) provide for relocation of rail yards, or for relocation of facilities as requested by a
political subdivision, which may include facilities of a Class I railroad or Class I rail carrier.
new text end

new text begin (b) The commissioner may provide financial assistance under the program for:
new text end

new text begin (1) capital improvement projects designed to improve a rail user or a rail carrier's rail
service which includes but is not limited to rail track, track structures, and rail facilities and
buildings;
new text end

new text begin (2) rehabilitation projects designed to improve a rail user or a rail carrier's rail service;
new text end

new text begin (3) development of industrial parks primarily or substantially served by rail service,
which:
new text end

new text begin (i) includes capital improvements to or rehabilitation of main industrial lead track; and
new text end

new text begin (ii) excludes siding track designed to serve areas of an industrial park for which occupants
are unidentified or uncommitted; and
new text end

new text begin (4) highway-rail grade crossing improvement or grade separation projects, including
but not limited to the local matching portion for federal grants.
new text end

new text begin Subd. 7. new text end

new text begin Evaluation and prioritization. new text end

new text begin The commissioners of transportation and
employment and economic development must establish project evaluation criteria to
determine financial assistance awards. At a minimum, the criteria must objectively prioritize
projects that:
new text end

new text begin (1) provide economic and employment impacts, including but not limited to
responsiveness to emergent market conditions; and
new text end

new text begin (2) address rail lines that have deteriorated or are in danger of deteriorating to such a
degree that the rail line is unable to carry the speeds and weights necessary to efficiently
transport goods and products that maintain or improve the rail user's competitiveness.
new text end

new text begin Subd. 8. new text end

new text begin Financial assistance; limitations. new text end

new text begin (a) When calculated in conjunction with
any other state sources of funds, an award of financial assistance under the program must
not provide combined state funding that exceeds 85 percent of the total project cost estimate.
new text end

new text begin (b) The commissioners of transportation and employment and economic development
must ensure that financial assistance is provided in a manner that is balanced throughout
the state, including with respect to (1) the number of projects receiving funding in a particular
geographic location or region of the state, and (2) the total amount of financial assistance
provided for projects in a particular geographic location or region of the state.
new text end

new text begin Subd. 9. new text end

new text begin Design, engineering, and construction standards. new text end

new text begin (a) The commissioner of
transportation is prohibited from establishing specifications or engineering standards that
are more restrictive than federal track safety standards under Code of Federal Regulations,
title 49, part 213, or successor requirements, for track and track structures awarded financial
assistance under the program.
new text end

new text begin (b) The relevant requirements under sections 16B.30 to 16B.355 do not apply to rail
facilities and buildings awarded financial assistance under the program.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective June 30, 2019.
new text end

Sec. 4.

Minnesota Statutes 2018, section 222.57, is amended to read:


222.57 RAIL USER AND RAIL CARRIER LOAN GUARANTEE ACCOUNT.

There is created a rail user and rail carrier loan guarantee account as a separate account
in the rail service improvement account, which shall be used by the commissioner for
carrying out the provisions of sections 222.55 to 222.62 with respect to loans insured under
section 222.58. The commissioner may transfer to the rail user and rail carrier loan guarantee
account from money otherwise available in the rail deleted text beginservice improvementdeleted text endnew text begin infrastructurenew text end
account whatever amount is necessary to implement the rail user and rail carrier loan
guarantee program, except that bond proceeds may not be transferred to the account for
insurance of loans made for the purposes specified in section 222.58, subdivision 2, paragraph
(b), clauses (3) to (5). The commissioner may withdraw any amount from the rail user and
rail carrier loan guarantee account that is not required to insure outstanding loans as provided
in section 222.60, subdivision 1.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective June 30, 2019.
new text end

Sec. 5.

Minnesota Statutes 2018, section 222.63, subdivision 8, is amended to read:


Subd. 8.

Rail bank accountsnew text begin; appropriationnew text end.

new text begin(a) new text endA deleted text beginspecial account shall be maintained
in the state treasury, designated as the
deleted text end rail bank maintenance accountdeleted text begin,deleted text endnew text begin is established in the
special revenue fund
new text end to record the receipts and expenditures of the commissioner of
transportation for the maintenance of rail bank property. Funds received by the commissioner
of transportation from interest earnings, administrative payments, rentals, fees, or charges
for the use of rail bank property, or received from rail line rehabilitation contracts deleted text beginshall bedeleted text endnew text begin
are
new text end credited to thenew text begin rail banknew text end maintenance account and used for the maintenance of that
property and held as a reserve for maintenance expenses in an amount determined by the
commissionerdeleted text begin, anddeleted text endnew text begin.new text end Amounts received in thenew text begin rail banknew text end maintenance account in excess of
the reserve requirements deleted text beginshalldeleted text endnew text begin mustnew text end be transferred to the rail deleted text beginservice improvementdeleted text endnew text begin
infrastructure
new text end accountnew text begin under section 222.505, subdivision 3new text end.

new text begin (b) new text endAll proceeds of the sale of abandoned rail lines deleted text beginshalldeleted text endnew text begin mustnew text end be deposited in the rail
deleted text begin service improvementdeleted text endnew text begin infrastructurenew text end account.

new text begin (c)new text end All money deleted text beginto bedeleted text end deposited in deleted text beginthisdeleted text endnew text begin thenew text end rail deleted text beginservice improvementdeleted text endnew text begin bank maintenancenew text end
account as provided in this subdivision is appropriated to the commissioner of transportation
for the purposes of this section. The appropriations deleted text beginshalldeleted text endnew text begin donew text end not lapse deleted text beginbut shall bedeleted text endnew text begin and arenew text end
available until the purposes for which the funds are appropriated are accomplished.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective June 30, 2019.
new text end

Sec. 6. new text beginRAIL INFRASTRUCTURE AND ECONOMIC DEVELOPMENT
PROGRAM; PROJECT SELECTION.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

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

new text begin (b) "Commissioners" means the commissioners of transportation and employment and
economic development. The commissioners must act jointly under this section unless
specified otherwise.
new text end

new text begin (c) "Program" means the rail infrastructure and economic development program under
Minnesota Statutes, section 222.505.
new text end

new text begin Subd. 2. new text end

new text begin Process development. new text end

new text begin Within 45 days of the day of enactment of this section,
the commissioners must convene interested stakeholders who are eligible recipients of
financial assistance under the program, in order to collaboratively develop the process for
applications, evaluation, and award of financial assistance.
new text end

new text begin Subd. 3. new text end

new text begin First priority projects. new text end

new text begin (a) Notwithstanding Minnesota Statutes, section
222.505, subdivision 4, the commissioners must give first priority to the following projects:
new text end

new text begin (1) North Shore Scenic Railroad: rail siding in the vicinity of Knife River;
new text end

new text begin (2) Progressive Rail: ties and surface rock in Bloomington and Rosemount, rail siding
in Bloomington, bridge repair in Bloomington, and track replacement in the vicinity of
Comus to Faribault;
new text end

new text begin (3) city of Otsego: rail infrastructure to serve a proposed industrial park;
new text end

new text begin (4) city of Monticello: highway-rail crossings;
new text end

new text begin (5) city of Big Lake: rail infrastructure for a proposed industrial park;
new text end

new text begin (6) city of Becker: rail infrastructure for an industrial park expansion;
new text end

new text begin (7) Twin Cities & Western Railroad: track maintenance and replacement, rail siding,
and track rehabilitation in Savage for port access;
new text end

new text begin (8) Northern Plains Railroad: ties, ballast, rail relay, grade crossing, and geostabilization;
new text end

new text begin (9) Minnesota Commercial Railway: updating and replacing rail in yards and on railroad
and extending sidings;
new text end

new text begin (10) Minnesota Northern Railroad and St. Croix Valley Railroad: track replacement,
ties, and ballast; and
new text end

new text begin (11) Ellis & Eastern Railroad: bridge and culvert maintenance and replacement, ties,
and track rehabilitation.
new text end

new text begin (b) The priority projects specified under paragraph (a) are added to the project requests
list under Minnesota Statutes, section 222.505, subdivision 4, subject to submission of
applications. Identified project activities are not comprehensive and do not limit use of
funds under the program.
new text end

new text begin (c) The priority projects specified under paragraph (a) must remain on the project requests
list as the priority unless fully funded, completed, or requested to be removed by the
appropriate project sponsor or lead. Nothing in this section prevents evaluation and
prioritization among the priority projects in the manner provided under Minnesota Statutes,
section 222.505, subdivision 7.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end