Laws of Minnesota 1992 

                        CHAPTER 394-H.F.No. 2341 
           An act relating to transportation; authorizing 
          nonoperating assistance for public transit service; 
          amending Minnesota Statutes 1990, section 174.24, 
          subdivisions 3, 5, and by adding subdivisions; 
          repealing Minnesota Statutes 1990, section 174.245. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1990, section 174.24, 
subdivision 3, is amended to read: 
    Subd. 3.  [FINANCIAL ASSISTANCE.] Payment of financial 
assistance shall be by contract between the commissioner and an 
eligible recipient.  
    Subd. 3b.  [OPERATING ASSISTANCE.] The commissioner shall 
determine the total operating cost of any public transit system 
receiving or applying for assistance in accordance with 
generally accepted accounting principles.  To be eligible for 
financial assistance, an applicant or recipient shall provide to 
the commissioner all financial records and other information and 
shall permit any inspection reasonably necessary to determine 
total operating cost and correspondingly the amount of 
assistance which may be paid to the applicant or recipient.  
Where more than one county or municipality contributes 
assistance to the operation of a public transit system, the 
commissioner shall identify one as lead agency for the purpose 
of receiving moneys under this section.  
    Prior to distributing operating assistance to eligible 
recipients for any contract period, the commissioner shall place 
all recipients into one of the following classifications:  large 
urbanized area service, urbanized area service, small urban area 
service, rural area service, and elderly and handicapped 
service.  The commissioner shall distribute funds under this 
section so that the percentage of total operating cost paid by 
any recipient from local sources will not exceed the percentage 
for that recipient's classification, except as provided in an 
undue hardship case.  The percentages shall be:  for large 
urbanized area service, 55 percent; for urbanized area service 
and small urban area service, 40 percent; for rural area 
service, 35 percent; and for elderly and handicapped service, 35 
percent.  The remainder of the total operating cost will be paid 
from state funds less any assistance received by the recipient 
from any federal source.  For purposes of this subdivision 
"local sources" means all local sources of funds and includes 
all operating revenue, tax levies, and contributions from public 
funds, except that the commissioner may exclude from the total 
assistance contract revenues derived from operations the cost of 
which is excluded from the computation of total operating cost.  
    If a recipient informs the commissioner in writing after 
the establishment of these percentages but prior to the 
distribution of financial assistance for any year that paying 
its designated percentage of total operating cost from local 
sources will cause undue hardship, the commissioner may reduce 
the percentage to be paid from local sources by the recipient 
and increase the percentage to be paid from local sources by one 
or more other recipients inside or outside the classification, 
provided that no recipient shall have its percentage thus 
reduced or increased for more than two years successively.  If 
for any year the funds appropriated to the commissioner to carry 
out the purposes of this section are insufficient to allow the 
commissioner to pay the state share of total operating cost as 
provided in this paragraph, the commissioner shall reduce the 
state share in each classification to the extent necessary. 
    Sec. 2.  Minnesota Statutes 1990, section 174.24, is 
amended by adding a subdivision to read: 
    Subd. 3c.  [NONOPERATING ASSISTANCE.] The commissioner 
shall determine the total cost of any planning and engineering 
design, capital assistance, other capital expenditures, and 
other assistance for public transit services that furthers the 
purposes of section 174.21 for any public transit system 
receiving or applying for the assistance in accordance with 
generally accepted accounting principles.  To be eligible for 
non-operating-cost financial assistance, an applicant or 
recipient shall provide to the commissioner all financial 
records and other information and shall permit any inspection 
reasonably necessary to determine total cost and the amount of 
assistance that may be paid to the applicant or recipient.  When 
more than one county or municipality contributes assistance to 
the operation of a public transit system, the commissioner shall 
identify one as a lead agency for the purpose of receiving money 
under this section.  The commissioner has the sole discretion to 
determine the amount of state funds distributed to any recipient 
for non-operating-cost assistance. 
    Sec. 3.  Minnesota Statutes 1990, section 174.24, 
subdivision 5, is amended to read: 
    Subd. 5.  [METHOD OF PAYMENT, OPERATING ASSISTANCE.] 
Payments for operating assistance under this section shall be 
made in the following manner:  
    50 percent of the total contract amount in the first month 
of operation; 
    40 percent of the total contract amount in the seventh 
month of operation; 
    9 percent of the total contract amount in the twelfth month 
of operation; and 
    1 percent of the total contract amount after the final 
audit.  
    Sec. 4.  Minnesota Statutes 1990, section 174.24, is 
amended by adding a subdivision to read: 
    Subd. 5a.  [METHOD OF PAYMENT, NONOPERATING ASSISTANCE.] 
Payments for planning and engineering design, eligible capital 
assistance, and other eligible assistance for public transit 
services furthering the purposes of section 174.21, excluding 
operating assistance, shall be made in an appropriate manner as 
determined by the commissioner. 
    Sec. 5.  [REPEALER.] 
    Minnesota Statutes 1990, section 174.245, is repealed. 
    Presented to the governor April 2, 1992 
    Signed by the governor April 3, 1992, 2:44 p.m.