Budgeting and Appropriations | Biennial enactment of two 12-month budgets; fiscal year begins July 1. Unanticipated federal funds may be appropriated through a contingent appropriations process, which requires the written approval of the governor and at least five members of a subset of the Legislature. |
Bonding or Pay-as-You-Go | Combination of bonding and pay-as-you-go financing. |
State-Level Funding Provided for DOT Budgets | FY 2011 (approved): $1.80 billion* |
Allocation of Federal Transportation Funds to the DOT | Federal funds that flow through the state's federal fund are reviewed by the Legislature, but do not require legislative appropriation or approval to be spent. Federal funds that flow through the state's trunk highway fund are appropriated through the biennial budget process, usually in categories such as construction or maintenance and occasionally as project-specific appropriations. These funds also can be approved via a contingent appropriation process in the case of unanticipated federal funds, maintenance emergencies or tort claims. |
Allocation of State Transportation Funds to the DOT | State revenues are constitutionally dedicated to the state's Highway User Tax Distribution Fund, then appropriated through direct and statutory appropriations to state agencies and programs. Appropriations usually are at the category level, but occasionally are project-specific. |
Traditional State Funding and Finance for Highways | Fuel taxes; motor vehicle/rental car sales taxes (up to 60 percent of the motor vehicle sales tax starting in FY 2012); vehicle registration/license/title fees; truck weight fees; interest income; various fines and fees; general obligation bonds. |
State Funding and Finance for Other Modes | Transit: General funds; general obligation bonds; motor vehicle/rental car sales taxes (at least 40 percent of the motor vehicle sales tax starting in FY 2012). Rail: General funds; general obligation bonds. Aviation: Airport property taxes; aviation fuel taxes; license taxes; general obligation bonds. Ports: General funds; general obligation bonds. |
Innovative Transportation Funding and Finance | State infrastructure bank (federally capitalized); congestion pricing; PPPs (authorized in statute); design build (authorized in statute, used as a component of at least five projects); advance construction. |
Dedicated/Restricted State Funds and Revenues | The state constitution establishes the Highway User Tax Distribution Fund, which consists of motor fuel taxes and taxes on motor vehicles and is dedicated solely to highway purposes (Minn. Const. art. XIV, §§1 et seq.). The constitution distributes the fund to trunk highways (62 percent), county roads (29 percent) and municipal streets (9 percent); 5 percent is set aside and can be apportioned to any of those purposes. Starting in FY 2012, the constitution also distributes at least 60 percent of motor vehicle sales tax receipts to the Highway User Tax Distribution Fund, and not less than 40 percent to a Transit Assistance Fund, where money is statutorily dedicated to greater Minnesota and metro area transit (Minn. Stat. Ann. §16A.88). Aviation-related revenues go to the State Airport Fund (e.g., Minn. Stat. Ann. §270.077, §296A.18 and §360.66), which is dedicated to aviation purposes (Minn. Stat. Ann. §360.017). These revenues are only statutorily dedicated, and transfers have been made from the State Airport Fund to deal with budget deficits. The use of aviation taxes is statutorily restricted by type of airport, zoning requirements, type of projects, and so on. Truck weight fees and other various fines and fees flow through the state's Trunk Highway Fund via statutory requirements; the constitution restricts uses of this fund (Minn. Const. art. XIV, §2 and §6). General obligation bonds are constitutionally restricted to public purposes and capital expenditures only (Minn. Const. art. XI, §5). Bonds may be designated to specific projects. |
DOT Authorized to Retain Surplus Funds | Yes and no. Appropriations can be carried forward within a biennium. Specific language accompanying an appropriation is needed for carry-forward authority across biennia. This authority generally is given in the aviation section of the transportation budget, but not necessarily in others. |
Legislative Approval Required to Move Funds Between Projects | Yes. Based on session law, Mn/DOT may transfer spending authority between maintenance funds and other Mn/DOT funds (other than construction) through a notification process. This authority may also be transferred to the construction appropriation. However, the spending authority from the construction appropriation may not be transferred to other areas of the budget without a legislative charge. |
Transportation Funding Allocations through Local Aid | In the biennial budget process, the Legislature makes lump sum appropriations to Mn/DOT for county roads and municipal streets based on a constitutional formula for distributing Highway User Tax Distribution Fund resources (Minn. Const. art. XI, §5). Mn/DOT then allocates funds to counties using statutory formulas based on equal distribution, need, motor vehicle registrations and lane miles (Minn. Stat. Ann. §§162.07 et seq.) and to municipalities based on needs and population (Minn. Stat. Ann. §162.13). The state's general obligation bonds assist with local road and bridge projects, which are mostly funded on a first-come, first-serve basis. |