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2660 Civic Center Drive DATE TO: January 7,2004 Citv Council Date: O1/12J04 Item: 9. F. T Utility �� } � � �l�rn� Roseville, Minnesota 55113 (651)792-7003 • fax: (651)792-7040 FROM: Duane Schwartz, Public Works [�i�� 651-792-7041 Debra B1oom, Assistant Public Works Director 651-792-7042 SUBJECT: Discussion of Transportation Utility Legislation Whi1e a11 cities face major challenges in providing funding for street improvements and maintenance, mature cities must find ways to provide an appropriate 1eve1 of maintenance and establish a cost effective construction and reconstruction program. Because of the limitations of special assessments, general fund appropriations and other potential funding sources, most of these cities �ind it extremely difficult to develop a�inancing program to fund the needed improvement and maintenance program. The City En�ineer's Association, Minnesota Public Works Association, and the League of Minnesota Cities,�'mtroducing legislation during the 2004 session that would enable Cities to establish a"TransportationUtility". A Transportation Utility is a system for raising money to support road and bridge maintenance and construction. This money would be dedicated to transportation infrastructure maintenance and reconstruction. The fees are calculated based on the amount of traffic generated. The term "utility" is employed because it is similar to a storm'sewer utility which allocates storm water draina�e system costs to property owners based on the volume of storm runoff draining, from their properties. Under a transportation utility, roadway users pay for roadway costs based on their use. Speci�ic allocation systems can vary; however, the basic approach is to charge properties based on the traffic they generate. Factors to consider include the number of employees, frequency of commute and the availability of other trafiic management strategies, such as subsidized mass transit, carpooling, etc. Roseville has positioned itself to maintain its existing 1oca1 street infrastructure through the establishment of our Street Infrastructure Replacement Fund. This fund wi11 meet the needs of non-MSA 1oca1 street we11 into the foreseeable future. State Aid funds available to inner ring suburbs have been shrinking due to expansion of infrastructure and population growth in outer ring suburbs- The revenues collected to support State �1��J funding have not kept up to this growth and expansion, resulting in fewer dollars per State Aid mile distributed to cities. We expect this to have an impact on our ability to cover the 1oca1 share of county and state road improvements within Roseville in We are also seeing an increasing expectation of 1oca1 participation in county and state transportation improvements. This wi11 also increase competition for already stretched 1oca1 resources. Access management and safety improvement projects could be jeopardized by lack of funding resources.