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unit of government, the local unit is eligible for special funding from the state turnback <br />account. These funds are in short supply, and this strategy is not used by the vast majority of <br />Minnesota cities. <br />Combine MSA dollars with special assessments. <br /> <br />The MSA mileage for each eligible city is certified by the Minnesota Department of Transportation, <br />and is derived by adding up 20% of the city's local roads and 100% of any Trunk Highway Turnback <br />mileage. The current MSA distribution formula is based 50% on each eligible cities population, and <br />50% on "city needs". According to the Mn/DOT 2002 MSA Street Apportionment Data report, <br />Construction (Money) Needs is defined as the estimated cost of constructing and maintaining the MSA <br />system over a period of 20 years. <br /> <br />Section 4 of this report includes key findings and recommendations on the MSA system in Minnesota, <br />including assertions on the adequacy of the MSA funding levels. <br /> <br />MSA Funding Sources: Motor Fuel Taxes, Tab Fees, MVST General Fund Transfer <br />The primary source of funding to the MSA program is the revenues to the State Highway User Tax <br />Distribution Fund (HUTDF), namely the state motor fuels tax and the vehicle license registration fee, <br />or "tab fee" as it is often called. In addition, the Legislature has recently dedicated a portion of revenues <br />from the 6.5% Motor Vehicle Sales Tax by transferring these revenues from the state general fund to <br />the Highway User Tax Distribution Fund. The MSA program is funded at nine percent of the revenues <br />to the HUTDF. Sixty-two percent of the revenues are dedicated for construction and maintenance of <br />the State Trunk Highway System, and 29 percent is dedicated to Minnesota Counties for the County <br />State Aid Highway system. <br /> <br />The flowchart (Figure 6) on the following page illustrates the flow of funds from state highway user <br />and general fund sources to the State Trunk Highway system and local units of government in <br />Minnesota. Dollars indicated are final amounts for the state fiscal year 2001. <br /> <br />10 <br /> <br /> <br />