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4/96 <br /> <br />CIP FINANCES <br /> <br />MUNICIPAL STATE AID (MSA) <br /> <br />MSA Funds can only be used for street, drainage, and sidewalk projects on <br />MSA routes. These funds are usually used in combination with assessments <br />to benefited properties and/or the use of City Reserve funds. The annual <br />allocation for the City of Elk River is approximately $590,000 per year. <br />These funds increase as the MSA mileage in the City increases. Funding is <br />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, Fillmore Street, Main Street/Highway 169, Main <br />Street/Orono Road and the bridge replacement, 193rd Avenue/Highway 169 <br />signal, Orono Parkway, and School Street/Jackson Avenue along with the <br />signal at this intersection. This fund also indirectly paid for the City's share <br />of Joplin Street, the extension of Orono Parkway and Elk Hills Drive/Dodge <br />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 $185,000 from the MSA annual allocation. <br />Accordingly, the annual revenues that are actually available to the City for <br />improvement projects for the next four years are approximately $405,000. <br /> <br />In 1994, the City advanced encumbered MSA funds for the School Street and <br />Freeport Avenue project. This project met MSA funding eligibility <br />requirements. By advance encumbering these funds, the State reserved the <br />funds and will allow the City to draw out these monies through 1996 for this <br />project. In reality, limited City MSA funds were needed for this project as <br />other funding sources (State turnback monies and project assessments) paid <br />for the majority of this project. However, by using this advance encumbering <br />technique, the City has more flexibility and can then use these funds for <br />other street projects that may not meet all of the MSA funding or design <br />requirements. This is how the fund indirectly helped finance Joplin Street, <br />the extension of Orono Parkway, and Elk Hills Drive/Dodge Avenue. <br /> <br />All but $100,000 of the 1996 MSA monies are dedicated to the Joplin Street <br />and Orono Parkway project that was completed last year. The remaining <br />$100,000 is scheduled to be applied to the Joplin Street and Highway 10 <br />intersection and signal project that is planned for 1996. <br /> <br />Page 1 of 13 <br /> <br /> <br />