5.5. SR 03-24-2003 - Laserfiche WebLink

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#B-3: Small cities are heavily reliant on locally generated revenues. As described above, cities under 5,000 in population are not eligible to receive state aid through the MSA program. As a result, these cities are reliant primarily on their own resources to fund road and bridge construction and maintenance. Figure 30 shows data collected from the 2002 City Road and Bridge Funding Survey that illustrates small cities reliance on their own revenue sources. As indicated in the graph, for the 108 cities under 5,000 surveyed, for the years 1997 through 2001, the share of locally generated revenue has fallen in the range of 70 percent or higher. It should also be noted that the state share is shown at around 25 percent, but in reality, only a small number of cities receive significant amounts of state funding for specific projects. 00% 80% 60% 40% 20% 0% Figure 30 Estimated Distribution of Total Road and Bridge Funding Revenues to Minnesota Cities Under 5,000 (108 Cities Surveyed) Local Sources · Federal [] State [] County/Other Partnership 1997 1998 1999 2000 2001 Source: 2002 City Road and Bridge Funding Survey Most of the time, small cities receive little if any state funding. #B-4: On the whole, small cities don't receive significant resources from other local units of government for "shared" projects. Figure 30 also illustrates the fact that overall, small cities do not receive much financial support from the counties in which they are located for the costs of road and bridge improvements affecting county roads within city boundaries. According to the 2002 City Road and Bridge Funding Survey, only a small number of cities reported receiving support for the costs of improving arterial and/or collector streets within their city limits. Policy Options The following policy options should be considered to assist Minnesota's 724 cities with populations under 5,000 who are ineligible to receive Municipal State Aid. Provide funding for a "Local Road Improvement Program" The principal purpose of the program would be to establish a pool of funding to support local road and bridge projects that would increase the capacity of the existing transportation system, but that do not benefit from the current funding structure. (A program designed to achieve these goals was passed by the 2002 legislature, but the funding was vetoed by the Governor.) (See Section 5, recommendation #l, page 40) 2. Allocate a portion of the existing 5% special fund to cities under 5,000 population. Small cities are often at a disadvantage when it comes to competing for state or federal money to support local projects. Given their limited populations, it is sometimes difficult to attract funding for projects that will effect limited numbers of system users. Nevertheless, these cities often have needs that are critical for the safety and efficiency of their road and bridge networks. A special fund 31