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4~97 <br /> <br />CIP FINANCES <br /> <br />MUNICIPAL STATE AID (MSA) <br /> <br />MSA Funds can only be used for street, street lights, drainage, and sidewalk <br />projects on MSA routes. These funds are usually used in combination with <br />assessments to benefited properties and/or the use of City Reserve funds. <br />The annual allocation for the City of Elk River is approximately $500,000 per <br />year. These funds increase as the MSA mileage in the City increases. The <br />MSA mileage is based on the total amount of local street miles in the City. <br />Funding is also subject to changes depending on State Legislative action. <br /> <br />Some improvement projects that have been partially funded with MSA <br />monies and which have taken place in the last ten years include: Tyler <br />Street, Proctor Avenue, Filmore Street, Main Street/Highway 169, Main <br />Street/Orono Road and the bridge replacement, 193rd Avenue/Highway 169 <br />signal, Orono Parkway, School Street/Jackson Avenue along with the signal <br />at this intersection and 171st Avenue. This fund also indirectly helped pay <br />for the City's share of Joplin Street, the extension of Orono Parkway and Elk <br />Hills Drive/Dodge Avenue. <br /> <br />In 1992, the City bonded for some large scale improvement projects (Main <br />Street/Highway 169, Orono Parkway, 193rd Avenue signal) and committed <br />future MSA funds from 1994 through 1999 for the repayment of these bonds. <br />This annual bond payment takes from $165,000 to $185,000 from the MSA <br />annual allocation. Accordingly, the annual revenues that are actually <br />available to the City for improvement projects for the next three years are <br />approximately $325,000. <br /> <br />The balance of the 1997-99 MSA funds that are not committed to the 1992 <br />bond are available for City use. If more funds are needed for street projects <br />than what are available, then the City can advance encumber monies or use <br />other City public improvement reserves to make the project work financially. <br />Additionally, a 1996 law change now allows cities to obtain an interest free <br />loan from the state aid pool of funds that have not been used by other <br />municipalities. The City used this new financing tool in 1996 for the 171st <br />Avenue project. This ~mprovement combined with the bond payment means <br />that all of the 1997 MSA funds available to the City have been used. <br />Additionally, some 1998 funds are committed to repaying this state loan. <br />Financing 1997 MSA projects will require an advance encumber of 1998 MSA <br />funds, which in turn, may limit projects undertaken in 1998. <br /> <br />Page 1 of 16 <br /> <br /> <br />