1.1 	A bill for an act
1.2 	relating to transportation; capital investment; taxes; amending provisions 
1.3 	governing transportation finance; establishing gross receipts motor fuels tax; 
1.4 	amending vehicle registration tax and metropolitan area transit sales tax; 
1.5 	amending distribution of highway user fund and county state-aid funding; 
1.6 	authorizing sale and issuance of trunk highway bonds and general obligation 
1.7 	bonds; requiring a report; appropriating money;amending Minnesota Statutes 
1.8 	2014, sections 161.081, subdivision 1; 161.20, by adding a subdivision; 162.07, 
1.9 	subdivision 1a; 168.013, subdivisions 1a, 8; 168.31, by adding a subdivision; 
1.10 	174.42, by adding a subdivision; 222.50, subdivision 7; 296A.061; 296A.11; 
1.11 	296A.12; 296A.16; 297A.815, subdivision 3; 297A.992; 473.167; 473.915; 
1.12 	Laws 2014, chapter 312, article 11, section 33; proposing coding for new law in 
1.13 	Minnesota Statutes, chapters 161; 174; 296A; 297A; 435; repealing Minnesota 
1.14 	Statutes 2014, sections 161.081, subdivision 3; 297A.992, subdivision 3.
1.15 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.16 	ARTICLE 1
1.17 	TRUNK HIGHWAY

1.18	Section 1. BOND APPROPRIATIONS.
 	
1.19 	The sums shown in the column under "Appropriations" are appropriated from the 
1.20 	bond proceeds account in the trunk highway fund to the state agencies or officials indicated, 
1.21 	to be spent for public purposes. Appropriations of bond proceeds must be spent as 
1.22 	authorized by the Minnesota Constitution, articles XI and XIV. Unless otherwise specified, 
1.23 	money appropriated in this article for a capital program or project may be used to pay state 
1.24 	agency staff costs that are attributed directly to the capital program or project in accordance 
1.25 	with accounting policies adopted by the commissioner of management and budget.

1.26	SUMMARY
	
1.27	Department of Transportation
	$
	1,000,000,000
	
2.1	Department of Management and Budget
		1,000,000
	
2.2	TOTAL
	$
	1,001,000,000

2.3						APPROPRIATIONS

2.4
2.5
2.6	Sec. 2. DEPARTMENT OF 
TRANSPORTATION CORRIDORS OF 
COMMERCE
 			$
	800,000,000
	
2.7 	(a) The appropriation in this section is 
2.8 	to the commissioner of transportation for 
2.9 	the corridors of commerce program under 
2.10 	Minnesota Statutes, section 161.088, and is 
2.11 	available in the amounts of $200,000,000 in 
2.12 	each fiscal year from 2016 to 2019.
2.13 	(b) In any fiscal year covered by this 
2.14 	appropriation, the commissioner may 
2.15 	identify projects based on previous selection 
2.16 	processes or may perform a new selection.
2.17 	(c) The appropriation in this section cancels 
2.18 	as specified under Minnesota Statutes, section 
2.19 	16A.642, except that the commissioner of 
2.20 	management and budget shall count the start 
2.21 	of authorization for issuance of state bonds 
2.22 	as the first day of the fiscal year during 
2.23 	which the bonds are available to be issued as 
2.24 	specified under paragraph (a), and not as the 
2.25 	date of enactment of this section.

2.26
2.27	Sec. 3. TRANSPORTATION ECONOMIC 
DEVELOPMENT PROGRAM
 			$
	200,000,000
	
2.28 	(a) This appropriation is for the transportation 
2.29 	economic development program under 
2.30 	Minnesota Statutes, section 174.12, and is 
2.31 	available in the amounts of $50,000,000 in 
2.32 	each fiscal year from 2016 to 2019.
2.33 	(b) The appropriation in this section cancels 
2.34 	as specified under Minnesota Statutes, section 
3.1 	16A.642, except that the commissioner of 
3.2 	management and budget shall count the start 
3.3 	of authorization for issuance of state bonds 
3.4 	as the first day of the fiscal year during 
3.5 	which the bonds are available to be issued as 
3.6 	specified under paragraph (a), and not as the 
3.7 	date of enactment of this section.

3.8	Sec. 4. BOND SALE EXPENSES
 			$
	1,000,000
	
3.9 	This appropriation is to the commissioner 
3.10 	of management and budget for bond sale 
3.11 	expenses under Minnesota Statutes, sections 
3.12 	16A.641, subdivision 8; and 167.50, 
3.13 	subdivision 4.

3.14 	Sec. 5. BOND SALE AUTHORIZATION.
 3.15 	To provide the money appropriated in this article from the bond proceeds account in 
3.16 	the trunk highway fund, the commissioner of management and budget shall sell and issue 
3.17 	bonds of the state in an amount up to $1,001,000,000 in the manner, upon the terms, and 
3.18 	with the effect prescribed by Minnesota Statutes, sections 167.50 to 167.52, and by the 
3.19 	Minnesota Constitution, article XIV, section 11, at the times and in the amounts requested 
3.20 	by the commissioner of transportation. The proceeds of the bonds, except accrued interest 
3.21 	and any premium received from the sale of the bonds, must be deposited in the bond 
3.22 	proceeds account in the trunk highway fund.

3.23 	Sec. 6. EFFECTIVE DATE.
 3.24 	This article is effective July 1, 2015.

3.25 	ARTICLE 2
3.26 	CAPITAL IMPROVEMENTS

3.27 	Section 1. CAPITAL IMPROVEMENT APPROPRIATIONS.
 3.28 	The sums stated are appropriated from the bond proceeds fund, or another named 
3.29 	fund, to the commissioner of transportation to be spent for public purposes, as described 
3.30 	in this article. Appropriations of bond proceeds must be spent as authorized by the 
3.31 	Minnesota Constitution, article XI, section 5, paragraph (a), to acquire and better public 
3.32 	land and buildings and other public improvements of a capital nature, or as authorized 
4.1 	by the Minnesota Constitution, article XI, section 5, paragraphs (b) to (j), or article XIV. 
4.2 	Unless otherwise specified, money appropriated in this act for a capital program or project 
4.3 	may be used to pay state agency staff costs that are attributed directly to the capital 
4.4 	program or project in accordance with accounting policies adopted by the commissioner 
4.5 	of management and budget. Unless otherwise specified, the appropriations in this article 
4.6 	are available until the project is completed or abandoned subject to Minnesota Statutes, 
4.7 	section 16A.642. Unless otherwise specified in this article, money appropriated in this 
4.8 	article for activities under Minnesota Statutes, sections 16B.307, 84.946, and 135A.046, 
4.9 	should not be used for projects that can be financed within a reasonable time frame under 
4.10 	Minnesota Statutes, section 16B.322 or 16C.144.

4.11	Sec. 2. TOTAL APPROPRIATIONS
 	$
		$

4.12
4.13	Sec. 3. LOCAL BRIDGE REPLACEMENT 
AND REHABILITATION
 	$
		$
	300,000,000
	
4.14 	This appropriation is from the bond proceeds 
4.15 	account in the state transportation fund 
4.16 	to match federal money and to replace or 
4.17 	rehabilitate local deficient bridges as provided 
4.18 	in Minnesota Statutes, section 174.50. This 
4.19 	appropriation is for the actual construction, 
4.20 	reconstruction, and improvement of local 
4.21 	bridges, including design-build contracts and 
4.22 	consultant usage to support these activities. 
4.23 	This includes the cost of actual payments to 
4.24 	landowners for lands acquired for highway 
4.25 	rights-of-way, payments to lessees, interest 
4.26 	subsidies, and relocation expenses. The 
4.27 	commissioner, in awarding grants under 
4.28 	this appropriation may establish priorities 
4.29 	according to the master bridge priority list, 
4.30 	but must use a minimum of $100,000,000 
4.31 	of this appropriation for replacement or 
4.32 	rehabilitation of bridges where the in-place 
4.33 	structure is ineligible for federal funding but 
4.34 	meets at least two of the three criteria under 
5.1 	the federal highway bridge replacement and 
5.2 	rehabilitation program.

5.3
5.4	Sec. 4. LOCAL ROAD IMPROVEMENT 
FUND GRANTS
 	$
		$
	100,000,000
	
5.5 	This appropriation is for: (1) construction and 
5.6 	reconstruction of local roads with statewide 
5.7 	or regional significance under Minnesota 
5.8 	Statutes, section 174.52, subdivision 4, with 
5.9 	priority given to projects that will expand the 
5.10 	state's ten-ton road system; and (2) grants to 
5.11 	counties to assist in paying the costs of rural 
5.12 	road safety capital improvement projects on 
5.13 	county state-aid highways under Minnesota 
5.14 	Statutes, section 174.52, subdivision 4a.

5.15
5.16	Sec. 5. AT-GRADE RAIL CROSSING 
IMPROVEMENTS
 	$
		$
	5,000,000
	
5.17 	This appropriation is for implementation of 
5.18 	safety improvements at highway-rail grade 
5.19 	crossings. The commissioner shall identify 
5.20 	highway-rail grade crossing locations and 
5.21 	improvements in consultation with railroads 
5.22 	and relevant road authorities.
5.23 	This appropriation is not available until the 
5.24 	commissioner of management and budget 
5.25 	has determined that 50 percent of the total 
5.26 	cost of each project has been committed 
5.27 	to the project from the entity that owns 
5.28 	the railroad track, and the conditions of 
5.29 	Minnesota Statutes, section 16A.502, have 
5.30 	been satisfied.

5.31
5.32	Sec. 6. RAIL GRADE SEPARATION 
IMPROVEMENTS
 	$
		$
	122,000,000
	
5.33 	This appropriation is for the construction of 
5.34 	priority grade separation projects to improve 
6.1 	rail corridor safety, as identified in the report 
6.2 	on grade crossings and rail safety for oil and 
6.3 	other hazardous materials under Laws 2014, 
6.4 	chapter 312, article 10, section 10.
6.5 	This appropriation is not available until the 
6.6 	commissioner of management and budget 
6.7 	has determined that 50 percent of the total 
6.8 	cost of each project has been committed 
6.9 	to the project from the entity that owns 
6.10 	the railroad track, and the conditions of 
6.11 	Minnesota Statutes, section 16A.502, have 
6.12 	been satisfied.

6.13	Sec. 7. RAIL SERVICE IMPROVEMENT
 	$
		$
	10,000,000
	
6.14 	This appropriation is for the rail service 
6.15 	improvement program to be spent for capital 
6.16 	improvement purposes set forth in Minnesota 
6.17 	Statutes, section 222.50, subdivision 7.

6.18
6.19	Sec. 8. INTERCITY PASSENGER RAIL 
PROJECTS
 	$
		$
	10,000,000
	
6.20 	This appropriation is to implement capital 
6.21 	improvements and betterments for intercity 
6.22 	passenger rail projects as identified in the 
6.23 	statewide freight and passenger rail plan 
6.24 	under Minnesota Statutes, section 174.03, 
6.25 	subdivision 1b, which are determined to be 
6.26 	eligible for United States Department of 
6.27 	Transportation funding. Notwithstanding 
6.28 	any law to the contrary, a portion or phase 
6.29 	of an intercity passenger rail project may 
6.30 	be accomplished with one or more state 
6.31 	appropriations, and an intercity passenger rail 
6.32 	project need not be completed with any one 
6.33 	appropriation. Capital improvements and 
6.34 	betterments include preliminary engineering, 
7.1 	design, engineering, environmental analysis 
7.2 	and mitigation, acquisition of land and 
7.3 	right-of-way, and construction.

7.4
7.5	Sec. 9. PORT DEVELOPMENT 
ASSISTANCE
 	$
		$
	10,000,000
	
7.6 	This appropriation is for grants under 
7.7 	Minnesota Statutes, chapter 457A. Any 
7.8 	improvements made with the proceeds of 
7.9 	these grants must be publicly owned.

7.10
7.11	Sec. 10. AIRPORT DEVELOPMENT 
ASSISTANCE
 	$
		$
	10,000,000
	
7.12 	This appropriation is for grants to airport 
7.13 	authorities for state airport improvements 
7.14 	to meet applicable system objectives as 
7.15 	provided in the Minnesota State Aviation 
7.16 	System Plan.

7.17 	Sec. 11. BOND SALE AUTHORIZATION.
 7.18 		Subdivision 1.State transportation fund bonds. To provide the money 
7.19 	appropriated in this article from the state transportation fund, the commissioner of 
7.20 	management and budget shall sell and issue bonds of the state in an amount up to 
7.21 	$400,400,0000 in the manner, upon the terms, and with the effect prescribed by Minnesota 
7.22 	Statutes, sections 16A.631 to 16A.675, and by the Minnesota Constitution, article XI, 
7.23 	sections 4 to 7. The proceeds of the bonds, except accrued interest and any premium 
7.24 	received on the sale of the bonds, must be credited to a bond proceeds account in the 
7.25 	state transportation fund.
7.26 		Subd. 2.Bond proceeds fund. To provide the money appropriated in this article 
7.27 	from the bond proceeds fund, the commissioner of management and budget shall sell and 
7.28 	issue bonds of the state in an amount up to $167,167,000 in the manner, upon the terms, 
7.29 	and with the effect prescribed by Minnesota Statutes, sections 16A.631 to 16A.675, and 
7.30 	by the Minnesota Constitution, article XI, sections 4 to 7. 

7.31 	Sec. 12. EFFECTIVE DATE.
 7.32 	Except where otherwise specified, this article is effective July 1, 2015.

8.1 	ARTICLE 3
8.2 	GROSS RECEIPTS TAX

8.3 	Section 1. Minnesota Statutes 2014, section 296A.061, is amended to read:
8.4 	296A.061 CANCELLATION OR NONRENEWAL OF LICENSES.
8.5 	The commissioner may cancel a license or not renew a license if one of the following 
8.6 	conditions occurs:
8.7 	(1) the license holder has not filed a petroleum tax return or report for at least one year;
8.8 	(2) the license holder has not filed a gross receipts tax return for at least one year;
8.9 	(3) the license holder has not reported any petroleum tax liability or gross receipts 
8.10 	tax liability on the license holder's returns or reports for at least one year; or
8.11 	(3)(4) the license holder requests cancellation of the license.

8.12 	Sec. 2. [296A.085] MOTOR FUELS GROSS RECEIPTS TAX.
8.13 		Subdivision 1.Imposition. A tax is imposed on the wholesale business of selling 
8.14 	the means or substance used for propelling vehicles on the highways of this state. The tax 
8.15 	is imposed at the rate of 6.5 percent of gross receipts derived by a distributor from the first 
8.16 	sale at wholesale of gasoline, gasoline blended with ethanol, agricultural alcohol gasoline, 
8.17 	and special fuels within this state for use in motor vehicles.
8.18 		Subd. 2.Exemptions. Subdivision 1 does not apply to gasoline, denatured ethanol, 
8.19 	special fuel, or alternative fuel purchased by an entity described in section 296A.07, 
8.20 	subdivision 4, or 296A.08, subdivision 3.
8.21 		Subd. 3.Conversion of tax rate. (a) Annually on or before August 1, the 
8.22 	commissioner shall determine the applicable gross receipts motor fuels tax rate per gallon. 
8.23 	The tax per gallon shall be the greater of either:
8.24 	(1) ten cents; or
8.25 	(2) 6.5 percent of the prior fiscal year's average wholesale gasoline price per 
8.26 	gallon in Minnesota for all grades by refiners, as published by the United States Energy 
8.27 	Information Administration and rounded to the nearest tenth of a cent per gallon.
8.28 	(b) The announced rate is effective for a 12-month period consisting of the next 
8.29 	October 1 to September 30. The commissioner shall publish on the department's Web site 
8.30 	the total of the gross receipts tax and the excise tax.
8.31 		Subd. 4.Administrative provisions. Except as otherwise provided in this chapter, 
8.32 	the relevant audit, assessment, refund, penalty, interest, enforcement, collection remedies, 
8.33 	appeal, and administrative provisions of chapter 289A apply to taxes imposed under 
8.34 	this section.
9.1 		Subd. 5.Deposit of revenues. The commissioner shall deposit the revenues from 
9.2 	the gross receipts tax into the highway user tax distribution fund.

9.3 	EFFECTIVE DATE. This section is effective October 1, 2015, and applies to 
9.4 	gross receipts attributable to the described products and derived by a distribution on or 
9.5 	after that day.

9.6 	Sec. 3. Minnesota Statutes 2014, section 296A.11, is amended to read:
9.7 	296A.11 SELLER MAY COLLECT TAX.
9.8 	A person who directly or indirectly pays a gasoline or special fuel tax or motor fuels 
9.9 	gross receipts tax as provided in this chapter and who does not in fact use the gasoline or 
9.10 	special fuel in motor vehicles in this state or receive, store, or withdraw it from storage 
9.11 	to be used personally for the purpose of producing or generating power for propelling 
9.12 	aircraft, but sells or otherwise disposes of the same, except as provided in section 296A.16, 
9.13 	subdivision 3, is hereby authorized to collect, from the person to whom the gasoline or 
9.14 	special fuel is so sold or disposed of, the tax so paid, and is hereby required, upon request, 
9.15 	to make, sign, and deliver to such person an invoice of such sale or disposition. The sums 
9.16 	collected must be held as a special fund in trust for the state of Minnesota.

9.17 	Sec. 4. Minnesota Statutes 2014, section 296A.12, is amended to read:
9.18 	296A.12 GASOLINE AND SPECIAL FUEL TAX AND MOTOR FUELS 
9.19 	GROSS RECEIPTS TAX IN LIEU OF OTHER TAXES.
9.20 	Gasoline and special fuel excise taxes and motor fuels gross receipts tax shall be 
9.21 	in lieu of all other taxes imposed upon the business of selling or dealing in gasoline or 
9.22 	special fuel, whether imposed by the state or by any of its political subdivisions, but are in 
9.23 	addition to all ad valorem taxes now imposed by law. Nothing in this chapter is construed 
9.24 	as prohibiting the governing body of any city of this state from licensing and regulating 
9.25 	sucha business where its authority is conferred by state law or city charter.

9.26 	Sec. 5. Minnesota Statutes 2014, section 296A.16, is amended to read:
9.27 	296A.16 REFUND OR CREDIT.
9.28 		Subdivision 1.Credit or refund of gasoline or special fuel tax paid. The 
9.29 	commissioner shall allow the distributor credit or refund of the tax paid on gasoline and 
9.30 	special fuel and of the motor fuels gross receipts tax attributed to fuel:
9.31 	(1) exported or sold for export from the state, other than in the supply tank of a 
9.32 	motor vehicle or of an aircraft;
10.1 	(2) sold to the United States government to be used exclusively in performing its 
10.2 	governmental functions and activities or to any "cost plus a fixed fee" contractor employed 
10.3 	by the United States government on any national defense project;
10.4 	(3) if the fuel is placed in a tank used exclusively for residential heating;
10.5 	(4) destroyed by accident while in the possession of the distributor;
10.6 	(5) in error;
10.7 	(6) in the case of gasoline only, sold for storage in an on-farm bulk storage tank, if 
10.8 	the tax was not collected on the sale; and
10.9 	(7) in such other cases as the commissioner may permit, consistent with the provisions 
10.10 	of this chapter and other laws relating to the gasoline and special fuel excise taxes.
10.11 		Subd. 2.Fuel used in other vehicle; claim for refund. Any person who buys and 
10.12 	uses gasoline for a qualifying purpose other than use in motor vehicles, snowmobiles 
10.13 	except as provided in clause (2), or motorboats, or special fuel for a qualifying purpose 
10.14 	other than use in licensed motor vehicles, and who paid the excise or gross receipts tax 
10.15 	directly or indirectly through the amount of the tax being included in the price of the 
10.16 	gasoline or special fuel, or otherwise, shall be reimbursed and repaid the amount of the 
10.17 	tax paid upon filing with the commissioner a claim for refund in the form and manner 
10.18 	prescribed by the commissioner, and containing the information the commissioner shall 
10.19 	require. By signing any such claim which is false or fraudulent, the applicant shall be 
10.20 	subject to the penalties provided in this chapter for knowingly making a false claim. 
10.21 	The claim shall set forth the total amount of the gasoline so purchased and used by the 
10.22 	applicant other than in motor vehicles, or special fuel purchased and used by the applicant 
10.23 	other than in licensed motor vehicles, and shall state when and for what purpose it was 
10.24 	used. When a claim contains an error in computation or preparation, the commissioner 
10.25 	is authorized to adjust the claim in accordance with the evidence shown on the claim or 
10.26 	other information available to the commissioner. The commissioner, on being satisfied 
10.27 	that the claimant is entitled to the payments, shall approve the claim and transmit it to the 
10.28 	commissioner of management and budget. The words "gasoline" or "special fuel" as used 
10.29 	in this subdivision do not include aviation gasoline or special fuel for aircraft. Gasoline or 
10.30 	special fuel bought and used for a "qualifying purpose" means:
10.31 	(1) Gasoline or special fuel used in carrying on a trade or business, used on a farm 
10.32 	situated in Minnesota, and used for a farming purpose. "Farm" and "farming purpose" 
10.33 	have the meanings given them in section 6420(c)(2), (3), and (4) of the Internal Revenue 
10.34 	Code as defined in section 289A.02, subdivision 7.
10.35 	(2) Gasoline or special fuel used for off-highway business use.
11.1 	(i) "Off-highway business use" means any use off the public highway by a person in 
11.2 	that person's trade, business, or activity for the production of income.
11.3 	(ii) Off-highway business use includes use of a passenger snowmobile off the public 
11.4 	highways as part of the operations of a resort as defined in section 157.15, subdivision 11; 
11.5 	and use of gasoline or special fuel to operate a power takeoff unit on a vehicle, but not 
11.6 	including fuel consumed during idling time.
11.7 	(iii) Off-highway business use does not include use as a fuel in a motor vehicle 
11.8 	which, at the time of use, is registered or is required to be registered for highway use under 
11.9 	the laws of any state or foreign country; or use of a licensed motor vehicle fuel tank in lieu 
11.10 	of a separate storage tank for storing fuel to be used for a qualifying purpose, as defined in 
11.11 	this section. Fuel purchased to be used for a qualifying purpose cannot be placed in the 
11.12 	fuel tank of a licensed motor vehicle and must be stored in a separate supply tank.
11.13 	(3) Gasoline or special fuel placed in the fuel tanks of new motor vehicles, 
11.14 	manufactured in Minnesota, and shipped by interstate carrier to destinations in other 
11.15 	states or foreign countries.
11.16 		Subd. 3.Destruction by accident; refund to dealer. Notwithstanding the 
11.17 	provisions of subdivision 1, the commissioner shall allow a dealer a refund of:
11.18 	(1) the tax paid by the distributor on, or gross receipts from the sale of,  gasoline, 
11.19 	undyed diesel fuel, or undyed kerosene destroyed by accident while in the possession of 
11.20 	the dealer; or
11.21 	(2) the tax paid by a distributor or special fuels dealer on, or gross receipts from the 
11.22 	sale of,  other special fuels destroyed by accident while in the possession of the dealer.
11.23 		Subd. 4.Refrigerator units; refunds. Notwithstanding the provisions of 
11.24 	subdivision 1, the commissioner shall allow a special fuel dealer a refund of the tax paid 
11.25 	on, or gross receipts from the sale of,  fuel sold directly into a supply tank of a refrigeration 
11.26 	unit with a separate engine and used exclusively by that refrigeration unit. A claim for 
11.27 	refund may be filed as provided in this section.
11.28 		Subd. 4a.Undyed kerosene; refunds. Notwithstanding subdivision 1, the 
11.29 	commissioner shall allow a refund of the tax paid on, or gross receipts from the sale of, 
11.30 	undyed kerosene used exclusively for a purpose other than as fuel for a motor vehicle 
11.31 	using the streets and highways. To obtain a refund, the person making the sale to an end 
11.32 	user must meet the Internal Revenue Service requirements for sales from a blocked pump. 
11.33 	A claim for a refund may be filed as provided in this section.
11.34 		Subd. 4b.Racing gasoline; refunds. Notwithstanding subdivision 1, the 
11.35 	commissioner shall allow a licensed distributor a refund of the tax paid on, or gross 
11.36 	receipts from the sale of,  leaded gasoline of 110 octane or more that does not meet ASTM 
12.1 	specification D4814 for gasoline and that is sold in bulk for use in nonregistered motor 
12.2 	vehicles. A claim for a refund may be filed as provided for in this section.
12.3 		Subd. 5.Qualifying service station credit. Notwithstanding any other provision of 
12.4 	law to the contrary, the tax imposed on gasoline, undyed diesel fuel, or undyed kerosene, 
12.5 	together with the amount attributable to gross receipts tax on these fuels,  delivered to a 
12.6 	qualified service station may not exceed, or must be reduced to, a rate not more than 
12.7 	three cents per gallon above the state tax rate imposed on such products sold by a service 
12.8 	station in a contiguous state located within the distance indicated in this subdivision. A 
12.9 	distributor shall be allowed a credit or refund for the amount of reduction computed in 
12.10 	accordance with this subdivision. For purposes of this subdivision, a "qualifying service 
12.11 	station" means a service station located within 7.5 miles, measured by the shortest route 
12.12 	by public road, from a service station selling like product in the contiguous state.
12.13 		Subd. 7.Civil penalty for filing false claim. A person who violates section 
12.14 	296A.23, subdivision 1, shall forfeit the full amount of the claim. In addition, a person who 
12.15 	is convicted under section 296A.23 for filing a false statement or claim shall, in addition 
12.16 	to any criminal penalties imposed, be prohibited from filing with the commissioner any 
12.17 	claim for refund upon gasoline purchased within six months after such conviction.
12.18 		Subd. 8.Appropriation. There is appropriated to the persons entitled to refund or 
12.19 	credit under this section, from the fund or account in the state treasury to which the money 
12.20 	was credited, an amount sufficient to make the credit or refund.

12.21 	Sec. 6. REVISOR'S INSTRUCTION.
 12.22 	In Minnesota Statutes, the revisor of statutes shall rename Minnesota Statutes, 
12.23 	chapter 296A, to be "Tax on Petroleum and Other Fuels; Gross Receipts Tax."

12.24 	ARTICLE 4
12.25 	VEHICLE REGISTRATION TAX

12.26 	Section 1. Minnesota Statutes 2014, section 168.013, subdivision 1a, is amended to read:
12.27 		Subd. 1a.Passenger automobile; hearse. (a) On passenger automobiles as defined 
12.28 	in section 168.002, subdivision 24, and hearses, except as otherwise provided, the tax shall 
12.29 	be $10 plus an additional tax equal to 1.25 1.5 percent of the base value.
12.30 	(b) Subject to the classification provisions herein, "base value" means the 
12.31 	manufacturer's suggested retail price of the vehicle including destination charge using list 
12.32 	price information published by the manufacturer or determined by the registrar if no 
12.33 	suggested retail price exists, and shall not include the cost of each accessory or item of 
12.34 	optional equipment separately added to the vehicle and the suggested retail price.
13.1 	(c) If the manufacturer's list price information contains a single vehicle identification 
13.2 	number followed by various descriptions and suggested retail prices, the registrar shall 
13.3 	select from those listings only the lowest price for determining base value.
13.4 	(d) If unable to determine the base value because the vehicle is specially constructed, 
13.5 	or for any other reason, the registrar may establish such value upon the cost price to the 
13.6 	purchaser or owner as evidenced by a certificate of cost but not including Minnesota sales 
13.7 	or use tax or any local sales or other local tax.
13.8 	(e) The registrar shall classify every vehicle in its proper base value class as follows:

13.9		FROM
		TO
	
13.10	$
	0
		$ 199.99
	
13.11	$
	200
		$ 399.99
	
13.12 	and thereafter a series of classes successively set in brackets having a spread of $200 
13.13 	consisting of such number of classes as will permit classification of all vehicles.
13.14 	(f) The base value for purposes of this section shall be the middle point between 
13.15 	the extremes of its class.
13.16 	(g) The registrar shall establish the base value, when new, of every passenger 
13.17 	automobile and hearse registered prior to the effective date of Extra Session Laws 1971, 
13.18 	chapter 31, using list price information published by the manufacturer or any nationally 
13.19 	recognized firm or association compiling such data for the automotive industry. If unable 
13.20 	to ascertain the base value of any registered vehicle in the foregoing manner, the registrar 
13.21 	may use any other available source or method. The registrar shall calculate tax using base 
13.22 	value information available to dealers and deputy registrars at the time the application for 
13.23 	registration is submitted. The tax on all previously registered vehicles shall be computed 
13.24 	upon the base value thus determined taking into account the depreciation provisions of 
13.25 	paragraph (h).
13.26 	(h) The annual additional tax must be computed upon a percentage of the base value 
13.27 	as follows: during the first year of vehicle life, upon 100 percent of the base value; for the 
13.28 	second year, 90 percent of such value; for the third year, 80 percent of such value; for the 
13.29 	fourth year, 70 percent of such value; for the fifth year, 60 percent of such value; for the sixth 
13.30 	year, 50 percent of such value; for the seventh year, 40 percent of such value; for the eighth 
13.31 	year, 30 percent of such value; for the ninth year, 20 percent of such value; for the tenth 
13.32 	year, ten percent of such value; for the 11th and each succeeding year, the sum of $25 $30.
13.33 	(i) In no event shall the annual additional tax be less than $25 $30.
13.34 	(j) For any vehicle previously registered in Minnesota, the annual additional tax 
13.35 	due under this subdivision must not exceed the smallest amount of annual additional 
13.36 	tax previously paid or due on the vehicle.

14.1 	EFFECTIVE DATE. This section is effective the day following final enactment 
14.2 	and applies to any annual additional tax for a registration period that begins on or after 
14.3 	September 1, 2015.

14.4 	ARTICLE 5
14.5 	METROPOLITAN AREA SALES TAX FOR TRANSIT

14.6 	Section 1. Minnesota Statutes 2014, section 297A.992, is amended to read:
14.7 	297A.992 METROPOLITAN TRANSPORTATION AREA TRANSIT SALES 
14.8 	TAX; TAX, JOINT POWERS BOARD.
14.9 		Subdivision 1.Definitions. For purposes of this section, the following terms have 
14.10 	the meanings given them:
14.11 	(1) "metropolitan transportation area" means the counties participating in the joint 
14.12 	powers agreement under subdivision 3;
14.13 	(2) "eligible county" means the county of Anoka, Carver, Dakota, Hennepin, 
14.14 	Ramsey, Scott, or and Washington;
14.15 	(3)(2) "committee" means the Grant Evaluation and Ranking System (GEARS) 
14.16 	Committee;
14.17 	(4) "minimum guarantee county" means any metropolitan county or eligible county 
14.18 	that is participating in the joint powers agreement under subdivision 3, whose proportion 
14.19 	of the annual sales tax revenue under this section collected within that county is less 
14.20 	than or equal to three percent; and
14.21 	(3) "net transit sales tax proceeds" means the total proceeds from the sales and use 
14.22 	taxes imposed under this section, less the deductions identified under subdivision 8; and
14.23 	(5)(4) "population" means the population, as defined in section 477A.011, 
14.24 	subdivision 3, estimated or established by July 15 of the year prior to the calendar year 
14.25 	in which the representatives will serve on the Grant Evaluation and Ranking System 
14.26 	Committee established under subdivision 5.
14.27 		Subd. 2.Authorization; rates. (a) Notwithstanding section 297A.99, subdivisions 
14.28 	1, 2, and 3, or 477A.016, or any other law, the board of a county participating in a 
14.29 	joint powers agreement as specified in this section shall impose by resolution (1) a 
14.30 	transportationtransit sales and use tax at a rate of one-quarter of one percent on retail 
14.31 	sales and uses taxable under this chapter, and (2) an excise tax of $20 per motor vehicle, 
14.32 	as defined in section 297B.01, subdivision 11, purchased or acquired from any person 
14.33 	engaged in the business of selling motor vehicles at retail, occurring within the jurisdiction 
14.34 	of the taxing authority. The taxes authorized are to fund transportation improvements as 
15.1 	specified in this section, including debt service on obligations issued to finance such 
15.2 	improvements pursuant to subdivision 7.
15.3 	(b) The tax imposed under this section is not included in determining if the total tax 
15.4 	on lodging in the city of Minneapolis exceeds the maximum allowed tax under Laws 1986, 
15.5 	chapter 396, section 5, as amended by Laws 2001, First Special Session chapter 5, article 
15.6 	12, section 87, or in determining a tax that may be imposed under any other limitations.
15.7 		Subd. 2a.Additional tax; rates. (a) A local sales tax is imposed in the metropolitan 
15.8 	counties, as defined in section 473.121, subdivision 4. In order to maintain the same rate 
15.9 	across the region, the tax is imposed in each county as follows:
15.10 	(1) effective for sales and purchases made after June 30, 2015, a sales and use tax on 
15.11 	retail sales and uses taxable under this chapter, at a rate equal to one percent minus the 
15.12 	tax rate imposed by each county under subdivision 2; and
15.13 	(2) effective for vehicles acquired after June 30, 2015, if not imposed by a county 
15.14 	under subdivision 2, an excise tax of $20 per motor vehicle, as defined in section 297B.01, 
15.15 	subdivision 11, purchased or acquired from any person engaged in the business of selling 
15.16 	motor vehicles at retail, occurring within the jurisdiction of the county.
15.17 	(b) The taxes imposed under this subdivision are not included in determining if the 
15.18 	total tax on lodging in the city of Minneapolis exceeds the maximum allowed tax under 
15.19 	Laws 1986, chapter 396, section 5, as amended by Laws 2001, First Special Session 
15.20 	chapter 5, article 12, section 87, and Laws 2012, chapter 299, article 3, section 3, or in 
15.21 	determining a tax that may be imposed under any other limitations.
15.22 		Subd. 3.Joint powers agreement. Before imposing the taxes authorized in 
15.23 	subdivision 2, an eligible county must declare by resolution of its county board to be part 
15.24 	of the metropolitan transportation area and must enter into a joint powers agreement. The 
15.25 	joint powers agreement:
15.26 	(1) must form a joint powers board, as specified in subdivision 4;
15.27 	(2) must provide a process that allows any eligible county, by resolution of its county 
15.28 	board, to join the joint powers board and impose the taxes authorized in subdivision 2;
15.29 	(3) may provide for withdrawal of a participating county before final termination of 
15.30 	the agreement; and
15.31 	(4) may provide for a weighted voting system for joint powers board decisions.
15.32 		Subd. 3a.Joint powers agreement. Each county in the metropolitan area shall 
15.33 	enter into a joint powers agreement that conforms to the provisions of this section and 
15.34 	that supersedes and revokes any previous joint powers agreement executed under this 
15.35 	section. The joint powers agreement:
15.36 	(1) must form a joint powers board, as specified in subdivision 4;
16.1 	(2) may provide for a weighted voting system for joint powers board decisions;
16.2 	(3) must not provide for withdrawal of a participating county before final termination 
16.3 	of the agreement; and
16.4 	(4) must be designed to carry out the provisions of this section.
16.5 		Subd. 4.Joint powers board. (a) The joint powers board must consist of one 
16.6 	or more commissioners of each county that is in the metropolitan transportation area, 
16.7 	appointed by its county board, and the chair of the Metropolitan Council, who all of whom
16.8 	must have voting rights, subject to subdivision 3, clause (4). The joint powers board has 
16.9 	the powers and duties provided in this section and section 471.59.
16.10 	(b) The joint powers board may utilize no more than three-fourthsone-half of one 
16.11 	percent of the net transit sales tax proceeds of the taxes imposed under this section for 
16.12 	ordinary administrative expenses incurred in carrying out the provisions of this section. 
16.13 	Any additional administrative expenses must be paid by the participating counties.
16.14 	(c) The joint powers board may establish a technical advisory group that is separate 
16.15 	from the GEARS Committee. The group must consist of representatives of cities, counties, 
16.16 	or public agencies, including the Metropolitan Council. The technical advisory group 
16.17 	must be used solely for technical consultation purposes.
16.18 	(d) The chair of the joint powers board must be a county commissioner who is 
16.19 	elected by the board.
16.20 		Subd. 5.Grant application and awards; Grant Evaluation and Ranking System 
16.21 	(GEARS) Committee process and general requirements. (a) The joint powers board 
16.22 	shall establish a grant application process and identify the amount of available funding 
16.23 	for grant awards. Grant applications must be submitted in a form prescribed by the joint 
16.24 	powers board. An applicant must provide, in addition to all other information required by 
16.25 	the joint powers board, the estimated cost of the project, the amount of the grant sought, 
16.26 	possible sources of funding in addition to the grant sought, and identification of any federal 
16.27 	funds that will be utilized if the grant is awarded. A grant application seeking transit capital 
16.28 	funding must identify the source of money necessary to operate the transit improvement.
16.29 	(b) The joint powers board shall establish a timeline and procedures for the award of 
16.30 	grants, and may award grants only to the state and political subdivisions. The board shall 
16.31 	define objective criteria for the award of grants, which must include, but not be limited to, 
16.32 	consistency with the most recent version of the transportation policy plan adopted by the 
16.33 	Metropolitan Council under section 473.146. The joint powers board shall maximize the 
16.34 	availability and use of federal funds in projects funded under this section.
16.35 	(c) Grants must be funded by the proceeds of the taxes imposed under this section, or 
16.36 	by bonds, notes, or other obligations issued by the joint powers board under subdivision 7.
17.1 		Subd. 5a.Grant awards; Grant Evaluation and Ranking System (GEARS) 
17.2 	Committee. (a) The joint powers board shall establish a GEARS Committee, which 
17.3 	must consist of:
17.4 	(1) one county commissioner from each county that is in the metropolitan 
17.5 	transportation area, appointed by its county board;
17.6 	(2) one elected city representative from each county that is in the metropolitan 
17.7 	transportation area;
17.8 	(3) one additional elected city representative from each county for every additional 
17.9 	400,000 in population, or fraction of 400,000, in the county that is above 400,000 in 
17.10 	population; and
17.11 	(4) the chair of the Metropolitan Council Transportation Committee.
17.12 	(d)(b) Each city representative must be elected at a meeting of cities in the 
17.13 	metropolitan transportation area, which must be convened for that purpose by the 
17.14 	Association of Metropolitan Municipalities.
17.15 	(e)(c) The committee shall:
17.16 	(1) evaluate grant applications following objective criteria established by the joint 
17.17 	powers board, and must;
17.18 	(2) provide to the joint powers board a selection list of transportation projects that 
17.19 	includes a priority ranking;
17.20 	(3) annually evaluate and award grants to local units of government, including 
17.21 	park districts for construction and maintenance of regional bicycle, trail, and pedestrian 
17.22 	infrastructure, and for safe routes to school infrastructure; and
17.23 	(4) annually evaluate and award grants to cities for planning activities related to 
17.24 	land use and transportation linkages, streetcar development, or bicycle and pedestrian 
17.25 	connections.
17.26 	(d) Grants awarded by the committee under paragraph (c), clauses (3) and (4), are 
17.27 	not subject to approval by the board. Annually, the committee shall award grants under 
17.28 	those clauses in a total amount that equals ten percent of the net transit sales tax proceeds, 
17.29 	of which amount no more than ten percent may be used for planning activities.
17.30 	(e) The committee may award a grant under paragraph (c), clause (3), only if the 
17.31 	project being funded is in compliance with:
17.32 	(1) a regional nonmotorized transportation system plan developed by the 
17.33 	Metropolitan Council; or
17.34 	(2) a municipal nonmotorized transportation plan, which must provide coordinated 
17.35 	development of transportation facilities located in adjacent communities, including 
17.36 	connections between facilities in each community.
18.1 		Subd. 5b.Grant awards; consistency with transportation plans. (f) A grant 
18.2 	award for a transit project located within the metropolitan area, as defined in section 
18.3 	473.121, subdivision 2, may be funded only after the Metropolitan Council reviews the 
18.4 	project for consistency with the transit portion of the Metropolitan Council policy plan 
18.5 	and one of the following occurs:
18.6 	(1) the Metropolitan Council finds the project to be consistent;
18.7 	(2) the Metropolitan Council initially finds the project to be inconsistent, but after a 
18.8 	good faith effort to resolve the inconsistency through negotiations with the joint powers 
18.9 	board, agrees that the grant award may be funded; or
18.10 	(3) the Metropolitan Council finds the project to be inconsistent, and submits the 
18.11 	consistency issue for final determination to a panel, which determines the project to be 
18.12 	consistent. The panel is composed of a member appointed by the chair of the Metropolitan 
18.13 	Council, a member appointed by the joint powers board, and a member agreed upon by 
18.14 	both the chair and the joint powers board.
18.15 	(g) Grants must be funded by the proceeds of the taxes imposed under this section, 
18.16 	bonds, notes, or other obligations issued by the joint powers board under subdivision 7.
18.17 	(h) Notwithstanding the provisions of this section except subdivision 6a, of 
18.18 	the revenue collected under this section, the joint powers board shall allocate to the 
18.19 	Metropolitan Council, in fiscal years 2012 and 2013, an amount not less than 75 percent of 
18.20 	the net cost of operations for those transitways that were receiving metropolitan sales tax 
18.21 	funds through an operating grant agreement on June 30, 2011.
18.22 	(i) The Metropolitan Council shall expend any funds allocated under paragraph (h) 
18.23 	for the operations of the specified transitways solely within those counties that are in the 
18.24 	metropolitan transportation area.
18.25 	(j) Nothing in paragraph (h) or (i) prevents grant awards to the Metropolitan Council 
18.26 	for capital and operating assistance for transitways and park-and-ride facilities.
18.27 		Subd. 6.Allocation of Grant awards; eligible uses. (a) The board must allocate 
18.28 	grant awards only for the following transit purposes:
18.29 	(1) transitway development and operations, consisting of:
18.30 	(i) capital improvements to transitways, including, but not limited to, commuter rail 
18.31 	rolling stock, light rail vehicles, and transitway buses;
18.32 	(ii) capital costs for park-and-ride facilities, as defined in section 174.256, 
18.33 	subdivision 2;
18.34 	(iii) feasibility studies, planning, alternatives analyses, environmental studies, 
18.35 	engineering, property acquisition for transitway purposes, and construction of transitways, 
19.1 	as identified in the transportation policy plan most recently adopted by the Metropolitan 
19.2 	Council; and
19.3 	(iv) operating assistance for transitways; and
19.4 	(2) as specified under subdivision 5a.
19.5 	(b) The joint powers board must annually award grants to each minimum guarantee 
19.6 	county in an amount no less than the amount of sales tax revenue collected within that 
19.7 	county as follows:
19.8 	(1) to Scott County and Carver County, the amount of the net sales tax proceeds 
19.9 	generated by one-quarter of one percent collected in each county respectively for calendar 
19.10 	years 2015 to 2019; 
19.11 	(2) to the Metropolitan Council for development and construction of transitways, 
19.12 	including all corridors and locally preferred alternatives adopted into the Metropolitan 
19.13 	Council transportation policy plan; 
19.14 	(3) to each county in the metropolitan area, an amount that equals one-eighth of 
19.15 	the net transit sales tax proceeds, to be distributed to each county proportionally based 
19.16 	on the sales and use tax proceeds under this section generated in that county divided 
19.17 	by the total sales and use taxes generated in the metropolitan area.  Grant awards under 
19.18 	this clause must be used by Hennepin County only for transit purposes, but by all other 
19.19 	counties for any transit purpose or any transportation purpose that has a nexus to transit 
19.20 	or transit-oriented development.  Grant awards under this section are not subject to the 
19.21 	joint certification process;
19.22 	(4) to transit authorities to establish, replace, or modify transit shelters to conform 
19.23 	with design specifications and maintenance requirements within the meaning of section 
19.24 	473.41; and
19.25 	(5) to the Center for Transportation Studies, University of Minnesota, $500,000 
19.26 	annually for research to improve accessibility, operational efficiency, and safety of transit 
19.27 	systems.
19.28 	(c) No more than 1.25 percent of the total awards may be annually allocated for 
19.29 	planning, studies, design, construction, maintenance, and operation of pedestrian programs 
19.30 	and bicycle programs and pathways.
19.31 		Subd. 6a.Priority of fund uses. The joint powers board shall allocate all revenues 
19.32 	from the taxes imposed under this section in conformance with the following priority order:
19.33 	(1) payment of debt service necessary for the fiscal year on bonds or other 
19.34 	obligations issued prior to January 1, 2011, under subdivision 7; and
19.35 	(2) as otherwise authorized under this section.
20.1 		Subd. 7.Bonds. (a) The joint powers board or any county, acting under a joint 
20.2 	powers agreement as specified in this section, may, by resolution, authorize, issue, and sell 
20.3 	its bonds, notes, or other obligations for the purpose of funding grants under subdivision 
20.4 	6. The joint powers board or county may also, by resolution, issue bonds to refund the 
20.5 	bonds issued pursuant to this subdivision.
20.6 	(b) The bonds of the joint powers board must be limited obligations, payable solely 
20.7 	from or secured by taxes levied under this section.
20.8 	(c) The bonds of any county may be limited obligations, payable solely from or 
20.9 	secured by taxes levied under this section. A county may also pledge its full faith, credit, 
20.10 	and taxing power as additional security for the bonds.
20.11 	(d) Bonds may be issued in one or more series and sold without an election. The bonds 
20.12 	shall be secured, bear the interest rate or rates or a variable rate, have the rank or priority, 
20.13 	be executed in the manner, be payable in the manner, mature, and be subject to the defaults, 
20.14 	redemptions, repurchases, tender options, or other terms, and shall be sold in such manner 
20.15 	as the joint powers board, the regional railroad authority, or the county may determine.
20.16 	(e) The joint powers board or any regional railroad authority or any county may 
20.17 	enter into and perform all contracts deemed necessary or desirable by it to issue and secure 
20.18 	the bonds, including an indenture of trust with a trustee within or without the state.
20.19 	(f) Except as otherwise provided in this subdivision, the bonds must be issued and 
20.20 	sold in the manner provided under chapter 475.
20.21 	(g) The joint powers board or any regional railroad authority wholly within the 
20.22 	metropolitan transportation area also may authorize, issue, and sell its bonds, notes, or 
20.23 	other obligations for the purposes, and in accordance with the procedures, set forth in 
20.24 	section 398A.07 to fund grants as provided in subdivision 6. The bonds of any regional 
20.25 	railroad authority may be limited obligations, payable solely from or secured by taxes 
20.26 	levied under this section. A regional railroad authority may also pledge its taxing powers 
20.27 	as additional security for the bonds.
20.28 		Subd. 8.AllocationRemittance of revenues. After the deductions allowed in 
20.29 	section 297A.99, subdivision 11, the commissioner of revenue shall remit the net proceeds 
20.30 	of the taxes imposed under this section on a monthly basis, as directed by the joint powers 
20.31 	board under this section provided under section 297A.9925.
20.32 		Subd. 9.Administration, collection, enforcement. Except as otherwise provided 
20.33 	in this section, the provisions of section 297A.99, subdivisions 4 and 6 to 12a, govern the 
20.34 	administration, collection, and enforcement of the tax authorized under this section.
20.35 		Subd. 10.Termination of local option taxes. (a) The taxes imposed under section 
20.36 	297A.99, subdivision 1, subdivision 2 by a county that withdraws from the joint powers 
21.1 	agreement pursuant to subdivision 3, clause (3), shall terminate when the county has 
21.2 	satisfied its portion, as defined in the joint powers agreement, of all outstanding bonds or 
21.3 	obligations entered into while the county was a member of the agreement.
21.4 	(b) If the joint powers agreement under subdivision 3 is terminated, the taxes 
21.5 	imposed under section 297A.99, subdivision 1, subdivision 2 at the time of the agreement 
21.6 	termination will terminate when all outstanding bonds or obligations are satisfied. The 
21.7 	auditors of the counties in which the taxes are imposed shall see to the administration of 
21.8 	this paragraph.
21.9 		Subd. 11.Report. The joint powers board shall report annually by February 1 to the 
21.10 	house of representatives and senatechairs and ranking minority members of the legislative 
21.11 	committees having jurisdiction over transportation policy and finance concerning the: 
21.12 	(1) board activities and actions; (2) bonds authorized or issued under subdivision 7; (3) 
21.13 	revenues received;  and (4) grants awarded.
21.14 		Subd. 12.Grant awards to Metropolitan Council. Any grant award under this 
21.15 	section made to the Metropolitan Council must supplement, and must not supplant, 
21.16 	operating and capital assistance provided by the state.

21.17 	EFFECTIVE DATE. This section is effective July 1, 2015, for sales and purchases 
21.18 	made after June 30, 2015, except that the imposition of the tax under subdivision 2a shall 
21.19 	be on the first day of the calendar quarter beginning at least 60 days after the date of final 
21.20 	enactment. This section applies in the counties of Anoka, Carver, Dakota, Hennepin, 
21.21 	Ramsey, Scott, and Washington.

21.22 	Sec. 2. [297A.9925] METROPOLITAN AREA TRANSIT SALES TAX; 
21.23 	ALLOCATION OF FUNDS.
21.24 		Subdivision 1.Definitions. For purposes of this section, the following terms have 
21.25 	the meanings given them:
21.26 	(1) "board" means the joint powers board established under section 297A.992; and
21.27 	(2) "net transit sales tax proceeds" has the meaning given in section 297A.992, 
21.28 	subdivision 1.
21.29 		Subd. 2.Allocation formula. In the manner specified under subdivision 6, the net 
21.30 	transit sales tax proceeds shall be allocated under subdivision 3 by the board and the 
21.31 	Metropolitan Council for all of the following purposes:
21.32 	(1) payment of debt service on bonds or other obligations;
21.33 	(2) Metropolitan Council transit operations;
21.34 	(3) 100 percent of the net operating subsidies for transitways and arterial bus rapid 
21.35 	transit; 
22.1 	(4) grants awarded by the GEARS Committee under section 297A.992, subdivision 
22.2 	5a;
22.3 	(5) grants awarded by the joint powers board under section 297A.992, subdivision 6, 
22.4 	paragraph (b), clause (3);
22.5 	(6) expansion and operation of regular route and commuter bus service provided 
22.6 	by metropolitan transit and suburban transit providers with expansion of service by an 
22.7 	annual average rate of four percent;
22.8 	(7) $500,000 annually for a grant to the Center for Transportation Studies at the 
22.9 	University of Minnesota; and
22.10 	(8) the remaining revenues following the allocations under clauses (1) to (7), to the 
22.11 	board, the council, or both, as specified in the joint certification under subdivision 3.
22.12 		Subd. 3.Joint certification. (a) The board and the Metropolitan Council shall 
22.13 	annually develop a joint certification as provided in this subdivision. The joint certification 
22.14 	must include, at a minimum, allocations for the purposes stated in subdivision 2 and must 
22.15 	be separately adopted by the board and by the council no later than August 31 of each year.
22.16 	(b) By July 1, 2015, and by March 15 of each subsequent year, the commissioner of 
22.17 	Minnesota management and budget shall provide to the board and council an estimate of 
22.18 	the net transit sales tax proceeds for the subsequent calendar year.
22.19 	(c) If, on October 1 in any year, the board and the Metropolitan Council have not 
22.20 	reached agreement as to the contents of the joint certification, they shall submit the issue 
22.21 	to a panel for dispute resolution. The panel shall be composed of a member appointed by 
22.22 	the chair of the Metropolitan Council, a member appointed by the board, and a member 
22.23 	agreed upon by both the chair and the board. The panel shall mediate discussion of areas 
22.24 	of disagreement and shall issue advisory recommendations.
22.25 	(d) If the commissioner does not receive a joint certification by December 1, the 
22.26 	commissioner may not remit the proceeds identified under subdivision 2, clause (8), 
22.27 	except as provided by a legislatively enacted appropriation.
22.28 	(e) The joint certification must specify the use of sales tax proceeds and account for 
22.29 	deposit of the remainder after allocations.
22.30 	(f) A joint certification may not exceed the estimated net transit sales tax proceeds 
22.31 	less the allocations required under subdivision 2, clauses (1) to (7).
22.32 	(g) By December 15 annually, the board shall electronically submit a copy of any 
22.33 	joint certification to the chairs and ranking minority members of the legislative committees 
22.34 	with jurisdiction over transportation policy and finance.
22.35 		Subd. 4.Uses and priorities; Metropolitan Council. The Metropolitan Council 
22.36 	shall use funds remitted to the council under this section in the following priority order:
23.1 	(1) continuation of bus and rail transit operations, including but not limited to 
23.2 	operations of providers under section 473.388, and operations and maintenance of all 
23.3 	transitways under revenue operations; and
23.4 	(2) transit expansion in accordance with the transit portion of the council's policy 
23.5 	transit plan, including but not limited to:
23.6 	(i) expansion and upgrades of bus service and related amenities, including transit 
23.7 	provided under section 473.388;
23.8 	(ii) development of arterial bus rapid transit, transitways, and streetcar systems 
23.9 	as appropriate; and
23.10 	(iii) maintenance of affordable transit fares.
23.11 		Subd. 5.Uses and priorities; joint powers board. The board shall use all funds 
23.12 	remitted to the board under this section as provided in section 297A.992.
23.13 		Subd. 6.Remittance schedule. (a) The commissioner of revenue shall remit the net 
23.14 	transit sales tax proceeds on a monthly basis to a fiscal agent selected by the board and 
23.15 	council. The fiscal agent shall maintain a council account, a board account, and an escrow 
23.16 	account. Proceeds shall be deposited in order as follows:
23.17 	(1) an amount equal to the net transit sales tax proceeds generated by one-quarter of 
23.18 	one percent collected in Anoka, Dakota, Hennepin, Ramsey, and Washington Counties 
23.19 	into the board account;
23.20 	(2) an amount required under subdivisions 2, 3, and 7, into the board and council 
23.21 	accounts; and
23.22 	(3) the remainder into the escrow account.
23.23 	(b) The rate of deposit for all or any portion of the proceeds into any account may 
23.24 	be modified by mutual agreement of the parties to reflect bond covenants or cash flow 
23.25 	needs. Proceeds deposited into the board and council accounts shall be transferred to the 
23.26 	board and council, respectively, within five business days of receipt. Unless otherwise 
23.27 	directed herein, money held in the escrow account is subject to the joint certification 
23.28 	process under subdivision 3.
23.29 		Subd. 7.Transition. (a) Notwithstanding subdivision 2, for the calendar year 
23.30 	ending December 31, 2015, the board shall advance proceeds from the net transit sales 
23.31 	tax imposed in section 297A.992, subdivision 2, for transit operations under chapter 
23.32 	473 and for capital needs.
23.33 	(b) The board account will be reimbursed ....... from net sales tax proceeds in 
23.34 	calendar year 2016.

23.35 	EFFECTIVE DATE. This section is effective July 1, 2015, and applies in the 
23.36 	counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.

24.1 	Sec. 3.  REPEALER.
 24.2 	Minnesota Statutes 2014, section 297A.992, subdivision 3, is repealed.

24.3 	EFFECTIVE DATE. This section is effective July 1, 2015.

24.4 	ARTICLE 6
24.5 	OTHER TAXES

24.6 	Section 1. Minnesota Statutes 2014, section 161.081, subdivision 1, is amended to read:
24.7 		Subdivision 1.Distribution of five percent. (a) Pursuant to article 14, section 5, of 
24.8 	the Constitution, five percent of the net highway user tax distribution fund is set aside, and 
24.9 	apportioned to the county state-aid highway fund.
24.10 	(b) That apportionment is further distributed as follows:
24.11 	(1) 30.5 percent to the town road account created in section 162.081;
24.12 	(2) 16 percent to the town bridge account, which is created in the state treasury 56.5 
24.13 	percent to the county state-aid highway fund, consisting of: (i) 30.5 percent to the town 
24.14 	road account created in section 162.081; (ii) 16 percent to the town bridge account created 
24.15 	in the state treasury; and (iii) ten percent to the county municipal accounts for purposes 
24.16 	described in section 162.08; and
24.17 	(3) 53.5 percent to the flexible highway account created in subdivision 3 (2) 43.5 
24.18 	percent to the municipal state-aid street fund.

24.19 	EFFECTIVE DATE. This section is effective July 1, 2015.

24.20 	Sec. 2. Minnesota Statutes 2014, section 162.07, subdivision 1a, is amended to read:
24.21 		Subd. 1a.Apportionment sum and excess sum. (a) For purposes of this 
24.22 	subdivision, "distribution amount" means the amount identified in section 162.06, 
24.23 	subdivision 1, after the deductions provided for in section 162.06 for administrative costs, 
24.24 	disaster account, research account, and state park road account.
24.25 	(b) The apportionment sum is calculated by subtracting the excess sum, as calculated 
24.26 	in paragraph (c), from as 68 percent of the distribution amount.
24.27 	(c) The excess sum is calculated as the sum of revenue within 32 percent of the 
24.28 	distribution amount:.
24.29 	(1) attributed to that portion of the gasoline excise tax rate under section 296A.07, 
24.30 	subdivision 3, in excess of 20 cents per gallon, and to that portion of the excise tax rates 
24.31 	in excess of the energy equivalent of a gasoline excise tax rate of 20 cents per gallon 
24.32 	for E85 and M85 under section 296A.07, subdivision 3, and special fuel under section 
24.33 	296A.08, subdivision 2;
25.1 	(2) attributed to a change in the passenger vehicle registration tax under section 
25.2 	168.013, imposed on or after July 1, 2008, that exceeds (i) the amount collected in fiscal 
25.3 	year 2008, multiplied by (ii) the annual average United States Consumer Price Index for 
25.4 	the calendar year previous to the current calendar year, divided by the annual average 
25.5 	United States Consumer Price Index for calendar year 2007; and
25.6 	(3) attributed to that portion of the motor vehicle sales tax revenue in excess of the 
25.7 	percentage allocated to the county state-aid highway fund in fiscal year 2007.
25.8 	(d) For purposes of this subdivision, the United States Consumer Price Index 
25.9 	identified in paragraph (c) is for all urban consumers, United States city average, as 
25.10 	determined by the United States Department of Labor.

25.11 	EFFECTIVE DATE. This section is effective October 1, 2015.

25.12 	Sec. 3. Minnesota Statutes 2014, section 297A.815, subdivision 3, is amended to read:
25.13 		Subd. 3.Motor vehicle lease sales tax revenue. (a) For purposes of this subdivision, 
25.14 	"net revenue" means an amount equal to the revenues, including interest and penalties, 
25.15 	collected under this section, during the fiscal year; less $32,000,000 in each fiscal year.
25.16 	(b) On or before June 30 of each fiscal year, the commissioner of revenue shall 
25.17 	estimate the amount of the net revenue revenues for the current fiscal year, including 
25.18 	interest and penalties collected during the fiscal year under this section.
25.19 	(c) (b) On or after July 1 of the subsequent fiscal year, the commissioner of 
25.20 	management and budget shall transfer the net revenue revenues  as estimated in paragraph 
25.21 	(b) (a) from the general fund, as follows:
25.22 	(1) $9,000,000 annually until January 1, 2015, and 50 percent annually thereafter to 
25.23 	the county state-aid highway fund. Notwithstanding any other law to the contrary, the 
25.24 	commissioner of transportation shall allocate the funds transferred under this clause to the 
25.25 	counties in the metropolitan area, as defined in section 473.121, subdivision 4, excluding 
25.26 	the counties of Hennepin and Ramsey, so that each county shall receive of such amount 
25.27 	the percentage that its population, as defined in section 477A.011, subdivision 3, estimated 
25.28 	or established by July 15 of the year prior to the current calendar year, bears to the total 
25.29 	population of the counties receiving funds under this clause; and
25.30 	(2) the remainder 50 percent to the greater Minnesota transit account.

25.31 	EFFECTIVE DATE. This section is effective January 1, 2017.

25.32 	Sec. 4. GREATER MINNESOTA TRANSIT APPROPRIATION.
 26.1 	$16,000,000 is appropriated from the general fund to the commissioner of 
26.2 	transportation in each of fiscal years 2016 and 2017, for assistance to transit systems 
26.3 	outside the metropolitan area under Minnesota Statutes, section 174.24.

26.4 	Sec. 5.  REPEALER.
 26.5 	Minnesota Statutes 2014, section 161.081, subdivision 3, is repealed.

26.6 	EFFECTIVE DATE. This section is effective July 1, 2015.

26.7 	ARTICLE 7
26.8 	EFFICIENCY MEASURES

26.9 	Section 1. Minnesota Statutes 2014, section 161.20, is amended by adding a 
26.10 	subdivision to read:
26.11 		Subd. 3a.Transfer of appropriations. With the approval of the commissioner of 
26.12 	management and budget, the commissioner of transportation may transfer unencumbered 
26.13 	balances among appropriations from the trunk highway fund and the state airports fund. 
26.14 	No transfer may be made from appropriations for state road construction, for operations 
26.15 	and maintenance, or for debt service. Transfers under this paragraph may not be made 
26.16 	between funds. Transfers under this paragraph must be reported immediately to the 
26.17 	chairs and ranking minority members of the legislative committees with jurisdiction 
26.18 	over transportation finance.

26.19 	EFFECTIVE DATE. This section is effective the day following final enactment.

26.20 	Sec. 2. [161.225] LOANS FOR LAND ACQUISITION FOR HIGHWAY 
26.21 	PROJECTS.
26.22 		Subdivision 1.Account established. The state right-of-way acquisition loan 
26.23 	account is created in the trunk highway fund for the purposes specified in this section. 
26.24 	Money in the account is annually appropriated to the commissioner and does not lapse. 
26.25 	Interest from the investment of money in this account must be deposited in the state 
26.26 	right-of-way acquisition loan account.
26.27 		Subd. 2.Loans. (a) The commissioner may make loans to counties, towns, and 
26.28 	statutory and home rule charter cities to purchase property within the right-of-way of 
26.29 	a state trunk highway shown on an official map adopted pursuant to section 394.361
26.30 	or 462.359, or to purchase property within the proposed right-of-way of a principal or 
26.31 	intermediate arterial highway. The loans shall be made from the fund established under this 
26.32 	subdivision for purchases approved by the commissioner. The loans shall bear no interest.
27.1 	(b) The commissioner shall make loans only to:
27.2 	(1) accelerate the acquisition of primarily undeveloped property when there 
27.3 	is a reasonable probability that the property will increase in value before highway 
27.4 	construction, and to update an expired environmental impact statement on a project for 
27.5 	which the right-of-way is being purchased;
27.6 	(2) avert the imminent conversion or the granting of approvals which would allow 
27.7 	the conversion of property to uses which would jeopardize its availability for highway 
27.8 	construction;
27.9 	(3) advance planning and environmental activities on highest priority major 
27.10 	metropolitan river crossing projects under the transportation development guide chapter 
27.11 	policy plan; or
27.12 	(4) take advantage of open market opportunities when developed properties become 
27.13 	available for sale, provided all parties involved are agreeable to the sale and funds are 
27.14 	available.
27.15 	(c) The commissioner shall not make loans to purchase property at a price which 
27.16 	exceeds the fair market value of the property or which includes the costs of relocating or 
27.17 	moving persons or property. The eminent domain process may be used to settle differences 
27.18 	of opinion as to fair market value, provided all parties agree to the process.
27.19 	(d) A private property owner may elect to receive the purchase price either 
27.20 	in a lump sum or in not more than four annual installments without interest on the 
27.21 	deferred installments. If the purchase agreement provides for installment payments, 
27.22 	the commissioner shall make the loan in installments corresponding to those in the 
27.23 	purchase agreement. The recipient of an acquisition loan shall convey the property for the 
27.24 	construction of the highway at the same price which the recipient paid for the property. The 
27.25 	price may include the costs of preparing environmental documents that were required for 
27.26 	the acquisition and that were paid for with money that the recipient received from the loan 
27.27 	fund. Upon notification by the commissioner that the plan to construct the highway has been 
27.28 	abandoned or the anticipated location of the highway has changed, the recipient shall sell 
27.29 	the property at market value in accordance with the procedures required for the disposition 
27.30 	of the property. All rents and other money received because of the recipient's ownership 
27.31 	of the property and all proceeds from the conveyance or sale of the property shall be paid 
27.32 	to the commissioner. If a recipient is not permitted to include in the conveyance price the 
27.33 	cost of preparing environmental documents that were required for the acquisition, then the 
27.34 	recipient is not required to repay the commissioner an amount equal to 40 percent of the 
27.35 	money received from the loan fund and spent in preparing the environmental documents.
28.1 	(e) For administration of the loan program, the commissioner may expend from the 
28.2 	fund each year an amount no greater than three percent of the amount of the proceeds for 
28.3 	that year.
28.4 		Subd. 3.Loans for acquisition and relocation. (a) The commissioner may 
28.5 	make loans to acquiring authorities within the metropolitan area to purchase homestead 
28.6 	property located in a proposed state trunk highway right-of-way or project, and to provide 
28.7 	relocation assistance. Acquiring authorities are authorized to accept the loans and to 
28.8 	acquire the property. Except as provided in this subdivision, the loans shall be made as 
28.9 	provided in subdivision 2. Loans shall be in the amount of the fair market value of the 
28.10 	homestead property plus relocation costs and less salvage value. Before construction of 
28.11 	the highway begins, the acquiring authority shall convey the property to the commissioner 
28.12 	at the same price it paid, plus relocation costs and less its salvage value. Acquisition and 
28.13 	assistance under this subdivision must conform to sections 117.50 to 117.56.
28.14 	(b) The commissioner may make loans only when:
28.15 	(1) the owner of affected homestead property requests acquisition and relocation 
28.16 	assistance from an acquiring authority;
28.17 	(2) federal or state financial participation is not available;
28.18 	(3) the owner is unable to sell the homestead property at its appraised market value 
28.19 	because the property is located in a proposed state trunk highway right-of-way or project as 
28.20 	indicated on an official map or plat adopted under section 160.085, 394.361, or 462.359; and
28.21 	(4) the commissioner agrees to and approves the fair market value of the homestead 
28.22 	property, which approval shall not be unreasonably withheld.
28.23 	(c) For purposes of this subdivision, the following terms have the meanings given 
28.24 	them:
28.25 	(1) "acquiring authority" means counties, towns, and statutory and home rule 
28.26 	charter cities;
28.27 	(2) "homestead property" means: (i) a single-family dwelling occupied by the 
28.28 	owner, and the surrounding land, not exceeding a total of ten acres; or (ii) a manufactured 
28.29 	home, as defined in section 327B.01, subdivision 13; and
28.30 	(3) "salvage value" means the probable sale price of the dwelling and other property 
28.31 	that is severable from the land if offered for sale on the condition that it be removed from 
28.32 	the land at the buyer's expense, allowing a reasonable time to find a buyer with knowledge 
28.33 	of the possible uses of the property, including separate use of serviceable components and 
28.34 	scrap when there is no other reasonable prospect of sale.

28.35 	EFFECTIVE DATE. This section is effective January 1, 2016.

29.1 	Sec. 3. Minnesota Statutes 2014, section 168.013, subdivision 8, is amended to read:
29.2 		Subd. 8.Tax proceeds to highway user fund; fee proceeds to vehicle services 
29.3 	account. (a) Unless otherwise specified in this chapter, the net proceeds of the registration 
29.4 	tax imposed under this chapter, including the penalty surcharge for late payment, imposed 
29.5 	in section 168.31, subdivision 1a,  must be collected by the commissioner, paid into the 
29.6 	state treasury, and credited to the highway user tax distribution fund.
29.7 	(b) All fees collected under this chapter, unless otherwise specified, must be 
29.8 	deposited in the vehicle services operating account in the special revenue fund under 
29.9 	section 299A.705.

29.10 	EFFECTIVE DATE. This section is effective July 1, 2015, and applies to vehicle 
29.11 	registration taxes due and unpaid on and after that date.

29.12 	Sec. 4. Minnesota Statutes 2014, section 168.31, is amended by adding a subdivision 
29.13 	to read:
29.14 		Subd. 1a.Penalty surcharge for late payment. Except as otherwise provided in 
29.15 	subdivisions 4 and 4a, a vehicle owner who has failed to pay the tax required under this 
29.16 	chapter on or before the due date shall pay in full the tax due on the vehicle, together with 
29.17 	a penalty surcharge of $25 for each month or portion of a month following the expiration 
29.18 	of the registration period, except that the amount of the late fee may not exceed $100.

29.19 	EFFECTIVE DATE. This section is effective July 1, 2015, and applies to vehicle 
29.20 	registration taxes due and unpaid on and after that date.

29.21 	Sec. 5. [174.53] FEDERAL FUND FLEXIBILITY PROGRAM.
29.22 	The commissioner shall establish a program to allow greater flexibility and 
29.23 	efficiency in the allocation of federal funds for state-aid transportation projects. The 
29.24 	commissioner shall:
29.25 	(1) establish and administer selection criteria and a process under which a local unit 
29.26 	of government that would otherwise receive federal funds for a local transportation project 
29.27 	would be able to finance the project with state funds instead of federal funds;
29.28 	(2) redirect the unused federal funds to transportation projects for which federal 
29.29 	funds could be utilized by the state more efficiently and productively;
29.30 	(3) achieve a reasonable degree of equity among the department districts in 
29.31 	distributing funds under the program; and
29.32 	(4) ensure that the state's receipt of federal funds for transportation projects is not 
29.33 	jeopardized by the program.

30.1 	EFFECTIVE DATE. This section is effective the day following final enactment.

30.2 	Sec. 6. [435.39] MUNICIPAL STREET IMPROVEMENT DISTRICTS.
30.3 		Subdivision 1.Definitions. (a) For the purposes of this section, the following terms 
30.4 	have the meanings given them.
30.5 	(b) "Governing body" means the city council of a municipality.
30.6 	(c) "Improvements" means construction, reconstruction, and facility upgrades 
30.7 	involving: right-of-way acquisition; paving; curbs and gutters; bridges and culverts and 
30.8 	their repair; milling; overlaying; drainage and storm sewers; excavation; base work; 
30.9 	subgrade corrections; street lighting; traffic signals; signage; sidewalks; pavement 
30.10 	markings; boulevard and easement restoration; impact mitigation; connection and 
30.11 	reconnection of utilities; turn lanes; medians; street and alley returns; retaining walls; 
30.12 	fences; lane additions; and fixed transit infrastructure, trails, or pathways. "Fixed transit 
30.13 	infrastructure" does not include commuter rail rolling stock, light rail vehicles, or 
30.14 	transitway buses; capital costs for park-and-ride facilities; feasibility studies, planning, 
30.15 	alternative analyses, environmental studies, engineering, or construction of transitways; or 
30.16 	operating assistance for transitways.
30.17 	(d) "Maintenance" means striping, seal coating, crack sealing, pavement repair, 
30.18 	sidewalk maintenance, signal maintenance, street light maintenance, and signage.
30.19 	(e) "Municipal street" means a street, alley, or public way in which the municipality 
30.20 	is the road authority with powers conferred by section 429.021.
30.21 	(f) "Municipality" means a home rule charter or statutory city.
30.22 	(g) "Street improvement district" means a geographic area designated by a 
30.23 	municipality and located within the municipality within which street improvements and 
30.24 	maintenance may be undertaken and financed according to this section.
30.25 	(h) "Unimproved parcel" means a parcel of land that abuts an unimproved municipal 
30.26 	street and that is not served by municipal sewer or water utilities; or in the case of a parcel 
30.27 	abutting an improved municipal street and served by municipal sewer or water utilities, 
30.28 	the parcel contains a structure that has not previously been occupied.
30.29 		Subd. 2.Authorization. A municipality may establish by ordinance municipal 
30.30 	street improvement districts and may defray all or part of the total costs of municipal 
30.31 	street improvements and maintenance by apportioning street improvement fees to all of 
30.32 	the parcels located in the district. A street improvement district must not include any 
30.33 	property already located in another street improvement district.
30.34 		Subd. 3.Uniformity. (a) The total costs of municipal street improvements and 
30.35 	maintenance must be apportioned to all developed parcels or developed tracts of land 
31.1 	located in the established street improvement district on a uniform basis within each 
31.2 	classification of real estate. Apportionment must be made on the basis of one of the 
31.3 	following:
31.4 	(1) estimated market value;
31.5 	(2) tax capacity;
31.6 	(3) front footage;
31.7 	(4) land or building area; or
31.8 	(5) some combination of clauses (1) to (4).
31.9 	(b) Costs must not be apportioned in such a way that the cost borne by any 
31.10 	classification of property is more than twice the cost that would be borne by that 
31.11 	classification if costs were apportioned uniformly to all classifications of property under 
31.12 	the method selected in paragraph (a), clauses (1) to (5).
31.13 		Subd. 4.Adoption of plan. Before establishing a municipal street improvement 
31.14 	district or authorizing a street improvement fee, a municipality must propose and adopt a 
31.15 	street improvement plan that identifies the location of the municipal street improvement 
31.16 	district and identifies and estimates the costs of the proposed improvements during the 
31.17 	proposed period of collection of municipal street improvement fees, which must be for 
31.18 	a period of at least five years and at most 20 years. Notice of a public hearing on the 
31.19 	proposed plan must be given by mail to all affected landowners at least 30 days before 
31.20 	the hearing and posted for at least 30 days before the hearing. At the public hearing, the 
31.21 	governing body must present the plan and all affected landowners in attendance must have 
31.22 	the opportunity to comment before the governing body considers adoption of the plan.
31.23 		Subd. 5.Use of fees. Revenues from street improvement fees must be placed in 
31.24 	a separate account and used only for projects located within the district and identified 
31.25 	in the municipal street improvement plan.
31.26 		Subd. 6.Collection; up to 20 years. (a) An ordinance adopted under this section 
31.27 	must provide for billing and payment of the fee on a monthly, quarterly, or other basis 
31.28 	as directed by the governing body. The governing body may collect municipal street 
31.29 	improvement fees within a street improvement district for a maximum of 20 years.
31.30 	(b) Fees that, as of October 15 of each year, have remained unpaid for at least 30 
31.31 	days may be certified to the county auditor for collection as a special assessment payable 
31.32 	in the following calendar year against the affected property.
31.33 		Subd. 7.Improvement fee. A municipality may impose a municipal street 
31.34 	improvement fee by ordinance. The ordinance must not be voted on or adopted until after 
31.35 	public notice is provided and a public hearing is held in the same manner as provided in 
31.36 	subdivision 4.
32.1 		Subd. 8.Not exclusive means of financing improvements. The use of the 
32.2 	municipal street improvement fee by a municipality does not restrict the municipality from 
32.3 	imposing other measures to pay the costs of local street improvements or maintenance, 
32.4 	except that a municipality must not impose special assessments for projects funded with 
32.5 	street improvement fees.
32.6 		Subd. 9.Undeveloped parcels; fees. A municipality may not impose a street 
32.7 	improvement fee on any undeveloped parcel located within an established street 
32.8 	improvement district until at least three years after either the date of substantial completion 
32.9 	of the paving of the previous unimproved municipal street or the date which a previously 
32.10 	unoccupied structure is first occupied, whichever is later.
32.11 		Subd. 10.Exempt property. A municipality must not impose a municipal street 
32.12 	improvement fee on property that is exempt from taxation under the provisions of the 
32.13 	Minnesota Constitution, article X, section 1.

32.14 	EFFECTIVE DATE. This section is effective July 1, 2015, and expires on June 
32.15 	30, 2020, except as to municipal street improvement fees that were imposed before the 
32.16 	expiration date. Municipal street improvement fees imposed before the expiration date 
32.17 	continue until they expire by the terms of the original ordinance.

32.18 	Sec. 7. Minnesota Statutes 2014, section 473.167, is amended to read:
32.19 	473.167 HIGHWAY AND TRANSIT PROJECTS.
32.20 		Subd. 2.Loans for acquisition. (a) The council may make loans to counties, towns, 
32.21 	and statutory and home rule charter cities within the metropolitan area for the purchase of 
32.22 	property within the right-of-way of a state trunk highway shown on an official map adopted 
32.23 	pursuant to section 394.361 or 462.359or, for the purchase of property within the proposed 
32.24 	right-of-way of a principal or intermediate arterial highway designated by the council as a 
32.25 	part of the metropolitan highway system plan and approved by the council pursuant to 
32.26 	section 473.166, or for the purchase of property needed for proposed transit-related capital 
32.27 	improvements, including transitways designated in the council's most recent transportation 
32.28 	policy plan. The loans shall be made by the council, from the fund established pursuant to 
32.29 	this subdivision, for purchases approved by the council. The loans shall bear no interest.
32.30 	(b) The council shall make loans only:
32.31 	(1) to accelerate the acquisition of primarily undeveloped property when there 
32.32 	is a reasonable probability that the property will increase in value before highway or 
32.33 	transit-related construction, and to update an expired environmental impact statement on 
32.34 	a project for which the right-of-way is being purchased;
33.1 	(2) to avert the imminent conversion or the granting of approvals which would allow 
33.2 	the conversion of property to uses which would jeopardize its availability for highway or 
33.3 	transit-related construction;
33.4 	(3) to advance planning and environmental activities on highest priority major 
33.5 	metropolitan river crossing projects, under the transportation development guide 
33.6 	chapter/policy plan; or
33.7 	(4) to take advantage of open market opportunities when developed properties 
33.8 	become available for sale, provided all parties involved are agreeable to the sale and 
33.9 	funds are available.
33.10 	(c) The council shall not make loans for the purchase of property at a price which 
33.11 	exceeds the fair market value of the property or which includes the costs of relocating or 
33.12 	moving persons or property. The eminent domain process may be used to settle differences 
33.13 	of opinion as to fair market value, provided all parties agree to the process.
33.14 	(d) A private property owner may elect to receive the purchase price either in a 
33.15 	lump sum or in not more than four annual installments without interest on the deferred 
33.16 	installments. If the purchase agreement provides for installment payments, the council 
33.17 	shall make the loan in installments corresponding to those in the purchase agreement. The 
33.18 	recipient of an acquisition loan shall convey the property for the construction of the highway 
33.19 	at the same price which the recipient paid for the property. The price may include the costs 
33.20 	of preparing environmental documents that were required for the acquisition and that were 
33.21 	paid for with money that the recipient received from the loan fund. Upon notification by 
33.22 	the council that the plan to construct the highway or transit project has been abandoned or 
33.23 	the anticipated location of the highway or transit project changed, the recipient shall sell 
33.24 	the property at market value in accordance with the procedures required for the disposition 
33.25 	of the property. All rents and other money received because of the recipient's ownership 
33.26 	of the property and all proceeds from the conveyance or sale of the property shall be paid 
33.27 	to the council. If a recipient is not permitted to include in the conveyance price the cost 
33.28 	of preparing environmental documents that were required for the acquisition, then the 
33.29 	recipient is not required to repay the council an amount equal to 40 percent of the money 
33.30 	received from the loan fund and spent in preparing the environmental documents.
33.31 	(e) The proceeds of the tax authorized by subdivision 3, all money paid to the 
33.32 	council by recipients of loans, and all interest on the proceeds and payments shall be 
33.33 	maintained as a separate fund. For administration of the loan program, the council may 
33.34 	expend from the fund each year an amount no greater than three percent of the amount of 
33.35 	the proceeds for that year.
34.1 		Subd. 2a.Loans for acquisition and relocation. (a) The council may make loans 
34.2 	to acquiring authorities within the metropolitan area to purchase homestead property 
34.3 	located in a proposed state trunk highway right-of-way or project or transit-related project, 
34.4 	and to provide relocation assistance. Acquiring authorities are authorized to accept the 
34.5 	loans and to acquire the property. Except as provided in this subdivision, the loans shall 
34.6 	be made as provided in subdivision 2. Loans shall be in the amount of the fair market 
34.7 	value of the homestead property plus relocation costs and less salvage value. Before 
34.8 	construction of the highway or transit-related project begins, the acquiring authority shall 
34.9 	convey the property to the commissioner of transportation or council at the same price it 
34.10 	paid, plus relocation costs and less its salvage value. Acquisition and assistance under this 
34.11 	subdivision must conform to sections 117.50 to 117.56.
34.12 	(b) The council may make loans only when:
34.13 	(1) the owner of affected homestead property requests acquisition and relocation 
34.14 	assistance from an acquiring authority;
34.15 	(2) federal or state financial participation is not available;
34.16 	(3) the owner is unable to sell the homestead property at its appraised market 
34.17 	value because the property is located in a proposed state trunk highway right-of-way or 
34.18 	project as indicated on an official map or plat adopted under section 160.085, 394.361, 
34.19 	or 462.359, or transit-related project; and
34.20 	(4) the council agrees to and approves the fair market value of the homestead 
34.21 	property, which approval shall not be unreasonably withheld.
34.22 	(c) For purposes of this subdivision, the following terms have the meanings given 
34.23 	them.
34.24 	(1) "Acquiring authority" means counties, towns, and statutory and home rule 
34.25 	charter cities in the metropolitan area.
34.26 	(2) "Homestead property" means: (i) a single-family dwelling occupied by the 
34.27 	owner, and the surrounding land, not exceeding a total of ten acres; or (ii) a manufactured 
34.28 	home, as defined in section 327B.01, subdivision 13.
34.29 	(3) "Salvage value" means the probable sale price of the dwelling and other property 
34.30 	that is severable from the land if offered for sale on the condition that it be removed from 
34.31 	the land at the buyer's expense, allowing a reasonable time to find a buyer with knowledge 
34.32 	of the possible uses of the property, including separate use of serviceable components and 
34.33 	scrap when there is no other reasonable prospect of sale.
34.34 		Subd. 3.Tax. The council may levy a tax on all taxable property in the metropolitan 
34.35 	area, as defined in section 473.121, to provide funds for loans made pursuant to 
34.36 	subdivisions 2 and 2a. This tax for the right-of-way acquisition loan fund shall be certified 
35.1 	by the council, levied, and collected in the manner provided by section 473.13. The tax 
35.2 	shall be in addition to that authorized by section 473.249 and any other law and shall not 
35.3 	affect the amount or rate of taxes which may be levied by the council or any metropolitan 
35.4 	agency or local governmental unit. The amount of the levy shall be as determined and 
35.5 	certified by the council, provided that the tax levied by the Metropolitan Council for the 
35.6 	right-of-way acquisition loan fund shall not exceed $2,828,379 for taxes payable in 2004 
35.7 	and $2,828,379 for taxes payable in 2005. The amount of the levy for taxes payable in 
35.8 	2006 and subsequent years shall not exceed the product of (1) the Metropolitan Council's 
35.9 	property tax levy limitation under this subdivision for the previous year, multiplied by 
35.10 	(2) one plus a percentage equal to the growth in the implicit price deflator as defined 
35.11 	in section 275.70, subdivision 2.
35.12 		Subd. 4.State review. The commissioner of revenue shall certify the council's levy 
35.13 	limitation under this section to the council by August 1 of the levy year. The council must 
35.14 	certify its proposed property tax levy to the commissioner of revenue by September 1 of 
35.15 	the levy year. The commissioner of revenue shall annually determine whether the property 
35.16 	tax for the right-of-way acquisition loan fund certified by the Metropolitan Council for 
35.17 	levy following the adoption of its proposed budget is within the levy limitation imposed 
35.18 	by this section. The determination must be completed prior to September 10 of each year. 
35.19 	If current information regarding market valuation in any county is not transmitted to the 
35.20 	commissioner in a timely manner, the commissioner may estimate the current market 
35.21 	valuation within that county for purposes of making the calculation.

35.22 	EFFECTIVE DATE. This section is effective the day following final enactment.

35.23 	Sec. 8. Laws 2014, chapter 312, article 11, section 33, is amended to read:
35.24 	Sec. 33. TRANSPORTATION EFFICIENCIES.
 35.25 	(a) The commissioner of transportation shall include in the report under Minnesota 
35.26 	Statutes, section 174.56, due by December 15, 2015, information on efficiencies 
35.27 	implemented in fiscal year 2015 in planning and project management and delivery, 
35.28 	along with an explanation of the efficiencies employed to achieve the savings and the 
35.29 	methodology used in the calculations. The level of savings achieved must equal, in 
35.30 	comparison with the total state road construction budget for that year, a minimum of five 
35.31 	percent in fiscal year 2015. The report must identify the projects that have been advanced 
35.32 	or completed due to the implementation of efficiency measures.
35.33 	(b) The commissioner shall identify in the report those recommendations from the 
35.34 	Transportation Strategic Management and Operations Advisory Task Force Report dated 
35.35 	January 23, 2009, submitted to the legislature by the Departments of Administration 
36.1 	and Transportation, as required by Laws 2008, chapter 152, article 6, section 9, 
36.2 	that the commissioner has implemented, with a description of current status of the 
36.3 	recommendation and results of implementation.
36.4 	(c) The commissioner shall present in the report plans to incorporate greater 
36.5 	efficiencies in department operation and decision-making, including, but not limited to, 
36.6 	the following: financing innovations, mode choice in project selection and design, land 
36.7 	use planning, return on investment calculation, project delivery, including selection of 
36.8 	materials and decreasing project delivery time, and efficiencies in multiagency permitting.

36.9 	Sec. 9. APPROPRIATION.
 36.10 	$....... is appropriated from the trunk highway fund to the commissioner of 
36.11 	transportation for deposit in the state right-of-way acquisition loan account under 
36.12 	Minnesota Statutes, section 161.225.

36.13 	EFFECTIVE DATE. This section is effective January 1, 2015.

36.14 	ARTICLE 8
36.15 	TRANSPORTATION POLICY

36.16 	Section 1. Minnesota Statutes 2014, section 174.42, is amended by adding a 
36.17 	subdivision to read:
36.18 		Subd. 3.Funding requirement for greater Minnesota. (a) In each federal fiscal 
36.19 	year, the commissioner shall spend out of National Highway Performance Program funds 
36.20 	a total amount in federal transportation funds for an active transportation competitive 
36.21 	grant program in greater Minnesota that totals a minimum of $16,000,000 in excess of 
36.22 	the average annual spending on greater Minnesota transportation alternatives projects in 
36.23 	federal fiscal years between October 2009 and September 2012. This requirement must 
36.24 	not reduce the amount of federal transportation funding for metropolitan projects.
36.25 	(b) The commissioner of transportation shall create and implement the active 
36.26 	transportation competitive grant program. The program must receive funds under this 
36.27 	subdivision and may receive funds from any other source. The commissioner shall 
36.28 	establish criteria for grant awards, in collaboration with experts in bicycle, pedestrian, 
36.29 	trail, and safe routes to school infrastructure. The criteria must clarify statewide priorities, 
36.30 	ensure that grant awards further these statewide priorities, and require grant recipients 
36.31 	to be accountable for their use of program resources. Cities, counties, and townships in 
36.32 	greater Minnesota are eligible to apply for grants for projects related to safe routes to 
36.33 	school infrastructure and noninfrastructure activities, bicycle and pedestrian elements 
37.1 	of a main street program, and planning activities and construction and maintenance of 
37.2 	bicycle, trail, and pedestrian infrastructure.

37.3 	EFFECTIVE DATE. This section is effective October 1, 2015.

37.4 	Sec. 2. Minnesota Statutes 2014, section 222.50, subdivision 7, is amended to read:
37.5 		Subd. 7.Expenditures. (a) The commissioner may expend money from the rail 
37.6 	service improvement account for the following purposes:
37.7 	(1) to make transfers as provided under section 222.57 or to pay interest adjustments 
37.8 	on loans guaranteed under the state rail user and rail carrier loan guarantee program;
37.9 	(2) to pay a portion of the costs of capital improvement projects designed to improve 
37.10 	rail service of a rail user or a rail carrier;
37.11 	(3) to pay a portion of the costs of rehabilitation projects designed to improve rail 
37.12 	service of a rail user or a rail carrier;
37.13 	(4) to acquire, maintain, manage, and dispose of railroad right-of-way pursuant to 
37.14 	the state rail bank program;
37.15 	(5) to provide for aerial photography survey of proposed and abandoned railroad 
37.16 	tracks for the purpose of recording and reestablishing by analytical triangulation the 
37.17 	existing alignment of the inplace track;
37.18 	(6) to pay a portion of the costs of acquiring a rail line by a regional railroad 
37.19 	authority established pursuant to chapter 398A;
37.20 	(7) to pay the state matching portion of federal grants for rail-highway grade 
37.21 	crossing improvement projects;
37.22 	(8) for expenditures made before July 1, 2017, to pay the state matching portion 
37.23 	of grants under the federal Transportation Investment Generating Economic Recovery 
37.24 	(TIGER) program of the United States Department of Transportation; and
37.25 	(9) to fund rail planning studies; and
37.26 	(10) to pay a portion of the costs of capital improvement projects designed to 
37.27 	improve capacity or safety at rail yards.
37.28 	(b) All money derived by the commissioner from the disposition of railroad 
37.29 	right-of-way or of any other property acquired pursuant to sections 222.46 to 222.62 shall 
37.30 	be deposited in the rail service improvement account.

37.31 	Sec. 3. Minnesota Statutes 2014, section 473.915, is amended to read:
37.32 	473.915 PROCUREMENTS.
38.1 		Subdivision 1.Review by Legislative Advisory Commission. All proposed 
38.2 	Metropolitan Council procurements over $125,000,000 must be reviewed by the 
38.3 	members of the Legislative Advisory Commission under section 3.30 and the ranking 
38.4 	minority members of the house of representatives and senate committees or divisions 
38.5 	responsible for overseeing the items subject to the proposed procurement. The chair 
38.6 	of the Metropolitan Council shall give notice to the Legislative Advisory Commission 
38.7 	secretary when a procurement over $125,000,000 is being considered. The commission 
38.8 	shall take testimony on the procurements.
38.9 		Subd. 2.Review by Transportation Accessibility Advisory Committee.
 38.10 	The council shall consult with the Transportation Accessibility Advisory Committee 
38.11 	concerning all proposed Metropolitan Council procurements of transit vehicles and shall 
38.12 	consider the committee's input before ordering vehicles.

38.13 	EFFECTIVE DATE. This section is effective the day following final enactment 
38.14 	and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and 
38.15 	Washington.

38.16 	Sec. 4. COST SHARE POLICY.
 38.17 	The commissioner of transportation, in consultation with representatives of local 
38.18 	units of government, shall create and adopt a policy concerning cost participation 
38.19 	for cooperative construction projects and maintenance responsibilities between the 
38.20 	Department of Transportation and local units of government.  The policy must minimize 
38.21 	the share of cooperative project costs to be funded by the local units of government, 
38.22 	while complying in all respects with the state constitutional requirements concerning 
38.23 	allowable uses of the trunk highway fund.  The policy must be completed and adopted by 
38.24 	the commissioner no later than September 1, 2015.

38.25 	EFFECTIVE DATE. This section is effective the day following final enactment.

38.26 	Sec. 5. PUBLIC-PRIVATE PARTNERSHIP PILOT PROGRAM.
 38.27 		Subdivision 1.Public-private partnership initiatives. (a) The commissioner 
38.28 	of transportation and Metropolitan Council are authorized to consider and utilize 
38.29 	public-private partnership procurement methods for up to three pilot projects as provided 
38.30 	in this section. Utilization of public-private partnerships is a recognition of the importance 
38.31 	to the state of an efficient and safe transportation system, and the necessity of developing 
38.32 	alternative funding sources to supplement traditional sources of transportation revenues. 
38.33 	A public-private partnership initiative must take advantage of private sector efficiencies in 
39.1 	design and construction, along with expertise in finance and development, and provide a 
39.2 	better long-term value for the state than could be obtained through traditional procurement 
39.3 	methods.
39.4 	(b) Notwithstanding Minnesota Statutes, section 160.845, 160.98, or any other law 
39.5 	to the contrary, the commissioner or council may consider for use in the pilot program any 
39.6 	existing public-private partnership mechanism or any proposed mechanism that proves the 
39.7 	best available option for the state. Mechanisms the commissioner or council may consider 
39.8 	include, but are not limited to, toll facilities, BOT facilities, BTO facilities, user fees, 
39.9 	construction payments, joint development agreements, negotiated exactions, air rights 
39.10 	development, street improvement districts, or tax increment financing districts for transit. 
39.11 	For the purposes this section, toll facilities, BOT facilities, and BTO facilities have the 
39.12 	meanings given under Minnesota Statutes, section 160.84.
39.13 	(c) As part of the pilot program, the commissioner and council are directed to form 
39.14 	an independent advisory and oversight office, the Joint Program Office for Economic 
39.15 	Development and Alternative Finance. The office shall consist of the commissioner of 
39.16 	management and budget, the commissioner of employment and economic development, 
39.17 	the commissioner of administration, the commissioner of transportation, the Metropolitan 
39.18 	Council, and one representative each from the American Council of Engineering 
39.19 	Companies - Minnesota chapter, the Central Minnesota Transportation Alliance, the 
39.20 	Counties Transit Improvement Board, and the Minnesota County Engineers Association. 
39.21 	In addition, the commissioner and Metropolitan Council shall invite the Federal Highway 
39.22 	Administration and the Federal Transit Administration to participate in the office's 
39.23 	activities. The office's duties shall include, but are not limited to, reviewing and approving 
39.24 	projects proposed under this section, reviewing any contractual or financial agreements 
39.25 	to ensure program requirements are met, and ensuring that any proposed or executed 
39.26 	agreement serves the public interest.
39.27 		Subd. 2.Pilot program restrictions and project selection. (a) The commissioner 
39.28 	or council may receive or solicit and evaluate proposals to build, operate, and finance 
39.29 	projects that are not inconsistent with the commissioner's most recent statewide 
39.30 	transportation plan or the council's most recent transportation policy plan. If the 
39.31 	department or council receives an unsolicited proposal, the department or council shall 
39.32 	publish a notice in the State Register at least once a week for two weeks stating that the 
39.33 	department or council has received the proposal and will accept, for 120 days after the 
39.34 	initial date of publication, other proposals for the same project purpose. The private 
39.35 	proposer must be selected on a competitive basis.
40.1 	(b) When entering into a public-private partnership, the commissioner or 
40.2 	Metropolitan Council may not enter into any noncompete agreement that inhibits the 
40.3 	state's ability to address ongoing or future infrastructure needs.
40.4 	(c) If the commissioner or council enters into a public-private partnership agreement 
40.5 	that includes a temporary transfer of ownership or control of a road, bridge, or other 
40.6 	infrastructure investment to the private entity, the agreement must include a provision 
40.7 	requiring the return of the road, bridge, or other infrastructure investment to the state 
40.8 	after a specified period of time.
40.9 	(d) The commissioner and council may only consider new projects for a 
40.10 	public-private partnership. The commissioner and council are prohibited from considering 
40.11 	projects involving existing infrastructure for a public-private partnership, unless the 
40.12 	proposed project adds capacity to the existing infrastructure.
40.13 		Subd. 3.Evaluation and selection of private entity and project. (a) The 
40.14 	commissioner and council shall contract with one or more consultants to assist in proposal 
40.15 	evaluation. The consultant must possess expertise and experience in public-private 
40.16 	partnership project evaluation methodology, such as value for money, costs of 
40.17 	public-private partnership compared with costs of public project delivery, and cost-benefit 
40.18 	analysis.
40.19 	(b) When soliciting, evaluating, and selecting a private entity with which to enter 
40.20 	into a public-private partnership and before selecting a project, the commissioner or 
40.21 	council must consider:
40.22 	(1) the ability of the proposed project to improve safety, reduce congestion, increase 
40.23 	capacity, and promote economic growth;
40.24 	(2) the proposed cost of and financial plan for the project;
40.25 	(3) the general reputation, qualifications, industry experience, and financial capacity 
40.26 	of the private entity;
40.27 	(4) the project's proposed design, operation, and feasibility;
40.28 	(5) length and extent of transportation and transit service disruption;
40.29 	(6) comments from local citizens and affected jurisdictions;
40.30 	(7) benefits to the public;
40.31 	(8) the safety record of the private entity; and
40.32 	(9) any other criteria the commissioner or council deems appropriate.
40.33 	(c) The independent advisory and oversight office established under subdivision 
40.34 	1, paragraph (c), shall review proposals evaluated by the commissioner or council to 
40.35 	ensure the requirements of this section are being met. The independent advisory and 
40.36 	oversight office shall first determine whether the project, as proposed, serves the public 
41.1 	interest. In making this determination, the office must identify and consider advantages 
41.2 	and disadvantages for various stakeholders, including taxpayers, workers, transportation 
41.3 	and transit providers and operators, transportation and transit users, commercial vehicle 
41.4 	operators, and the general public, including the impact on the state's economy. If the 
41.5 	proposed project serves the public interest, the office must evaluate the proposals 
41.6 	according to the criteria specified in this section.
41.7 		Subd. 4.Public-private agreement. (a) A public-private agreement between the 
41.8 	commissioner or the council and a private entity shall, at a minimum, specify:
41.9 	(1) the planning, acquisition, financing, development, design, construction, 
41.10 	reconstruction, replacement, improvement, maintenance, management, repair, leasing, or 
41.11 	operation of the project;
41.12 	(2) the term of the public-private agreement;
41.13 	(3) the type of property interest, if any, that the private entity will have in the project;
41.14 	(4) a description of the actions the commissioner or council may take to ensure 
41.15 	proper maintenance of the project; 
41.16 	(5) whether user fees will be collected on the project and the basis by which the user 
41.17 	fees shall be determined and modified along with identification of the public agency that 
41.18 	will determine and modify fees;
41.19 	(6) compliance with applicable federal, state, and local laws;
41.20 	(7) grounds for termination of the public-private agreement by the commissioner 
41.21 	or council;
41.22 	(8) adequate safeguards for the traveling public and residents of the state in event of 
41.23 	default on the contract;
41.24 	(9) financial protection for the state in the event of default; and 
41.25 	(10) procedures for amendment of the agreement.
41.26 	(b) A public-private agreement between the commissioner or council and a private 
41.27 	entity may provide for:
41.28 	(1) review and approval by the commissioner or council of the private entity's plans 
41.29 	for the development and operation of the project;
41.30 	(2) inspection by the commissioner or council of construction and improvements 
41.31 	to the project;
41.32 	(3) maintenance by the private entity of a liability insurance policy;
41.33 	(4) filing of appropriate financial statements by the private entity on a periodic basis;
41.34 	(5) filing of traffic reports by the private entity on a periodic basis;
41.35 	(6) financing obligations of the commissioner or council and the private entity;
42.1 	(7) apportionment of expenses between the commissioner or council and the private 
42.2 	entity;
42.3 	(8) the rights and remedies available in the event of a default or delay;
42.4 	(9) the rights and duties of the private entity, the commissioner or council, and other 
42.5 	state or local governmental entities with respect to the use of the project;
42.6 	(10) the terms and conditions of indemnification of the private entity by the 
42.7 	commissioner or council;
42.8 	(11) assignment, subcontracting, or other delegations of responsibilities of (i) 
42.9 	the private entity, or (ii) the commissioner or council under agreement to third parties, 
42.10 	including other private entities or state agencies;
42.11 	(12) if applicable, sale or lease to the private entity of private property related to 
42.12 	the project;
42.13 	(13) traffic enforcement and other policing issues; and
42.14 	(14) any other terms and conditions the commissioner or council deems appropriate.
42.15 	(c) The independent advisory and oversight office established under subdivision 
42.16 	1, paragraph (c), shall review any proposed contractual agreement prior to execution 
42.17 	in order to ensure that the contract serves the public interest and the requirements of 
42.18 	this section are met.
42.19 		Subd. 5.Funding from federal government. (a) The commissioner or council may 
42.20 	accept from the United States or any of its agencies funds that are available to the state 
42.21 	for carrying out the pilot program, whether the funds are available by grant, loan, or 
42.22 	other financial assistance.
42.23 	(b) The commissioner or council may enter into agreements or other arrangements 
42.24 	with the United States or any of its agencies as necessary for carrying out the pilot program.
42.25 	(c) The commissioner or council shall seek to maximize project funding from 
42.26 	nonstate sources and may combine federal, state, local, and private funds to finance a 
42.27 	public-private partnership pilot project.
42.28 		Subd. 6.Reporting. By August 1, 2016, and annually by August 1 thereafter, the 
42.29 	commissioner and council shall submit to the chairs and ranking minority members of the 
42.30 	house of representatives and senate committees having jurisdiction over transportation 
42.31 	policy and finance a list of all agreements executed under the pilot program authority. The 
42.32 	list must identify each agreement, the contracting entities, contract amount and duration, 
42.33 	any repayment requirements, and provide an update on the project's progress. The list 
42.34 	may be submitted electronically and is subject to Minnesota Statutes, section 3.195, 
42.35 	subdivision 1.

43.1 	EFFECTIVE DATE. This section is effective the day after an appropriation is 
43.2 	effective to pay administrative expenses creating and operating the Joint Program Office 
43.3 	for Economic Development and Alternative Finance, hiring a consultant, and preparing 
43.4 	required reports.

43.5 	Sec. 6. TRANSPORTATION PROJECT SELECTION PROCESS.
 43.6 		Subdivision 1.Adoption of process and public input. The commissioner of 
43.7 	transportation shall, after consultation with metropolitan planning organizations, regional 
43.8 	development commissions, area transportation partnerships, local governments, and the 
43.9 	Metropolitan Council, draft a proposed transportation project data-driven evaluation 
43.10 	process to provide an objective and consistent analysis to assist in prioritization of 
43.11 	highway construction, reconstruction, and improvement projects.  No later than January 
43.12 	10, 2016, the proposed process must be reported to the chairs and ranking minority 
43.13 	members of the house of representatives and senate committees on transportation policy 
43.14 	and finance and publicized, along with a schedule for public hearings and additional 
43.15 	opportunities for public input electronically and at locations throughout the state.  No 
43.16 	later than March 1, 2016, after public comment has been heard and incorporated into the 
43.17 	proposed evaluation process, the commissioner shall adopt a final process for use in 
43.18 	highway project investment decisions on and after July 1, 2016.
43.19 		Subd. 2.Factors in analysis. The process must be based on objective, consistent, 
43.20 	and quantifiable analysis.  Factors in the analysis must include return on investment, 
43.21 	benefit-cost, local rankings, safety, congestion mitigation, economic development, 
43.22 	accessibility, environmental quality, regional and metropolitan-rural balance, and land 
43.23 	use.  The process may assign different weights to factors in evaluating projects on the 
43.24 	trunk highway system, the county state-aid highway system, and the municipal state-aid 
43.25 	street system.
43.26 		Subd. 3.Exemptions. A proposed project is exempt from the process if it is funded 
43.27 	by a grant from: (1) the corridors of commerce program under Minnesota Statutes, section 
43.28 	161.088; (2) the transportation economic development program under Minnesota Statutes, 
43.29 	section 174.12; or (3) the joint powers board under Minnesota Statutes, section 297A.992, 
43.30 	subdivision 6, paragraph (b), clause (3); or if subjecting it to the evaluation process would 
43.31 	result in a loss of federal funds.
43.32 		Subd. 4.Information on department Web site. For each proposed project evaluated 
43.33 	under this process, the applicable scoring process, the score for each factor, and the overall 
43.34 	score are public information and must be publicized on the department's Web site.

43.35 	EFFECTIVE DATE. This section is effective the day following final enactment.

44.1 	Sec. 7. REPORT ON DEDICATED FUND EXPENDITURES. 
44.2 	By January 15, 2016, the commissioner of management and budget shall submit 
44.3 	a report to the chairs and ranking minority members of the legislative committees with 
44.4 	jurisdiction over transportation finance. The report must list detailed expenditures and 
44.5 	transfers from the trunk highway fund and highway user tax distribution fund for fiscal 
44.6 	years 2010 through 2015, and shall include information on the purpose of each expenditure.