398A.01 DEFINITIONS.
    Subdivision 1. Application. The terms defined in this section are used in sections 398A.01
to 398A.08 with the following meanings, respectively.
    Subd. 2. Authority. "Authority" means a regional railroad authority organized and existing
as a political subdivision and local government unit pursuant to section 398A.03.
    Subd. 3. Bonds. "Bonds" means any bonds, notes, or other obligations issued by an authority
pursuant to section 398A.07.
    Subd. 4. Governing body. "Governing body" means the board, council, or other body
authorized by law to exercise the governmental powers of a municipality.
    Subd. 5. Municipality. "Municipality" means any county, city, or town.
    Subd. 6. Project. "Project" means any railroad facilities proposed to be acquired, constructed,
improved, or refinanced by an authority in whole or part by the issuance of bonds, including any
real or personal property, structures, machinery, equipment, and appurtenances determined by the
authority to be useful or convenient for railroad operations and handling passengers or freight.
    Subd. 7. Real property. "Real property" means lands, structures, improvements thereof, and
water and riparian rights, and any and all interests and estates therein, legal or equitable, including
but not limited to easements, rights-of-way, uses, leases, and licenses.
    Subd. 8. Regional Railroad Authorities Act. "Regional Railroad Authorities Act" means
sections 398A.01 to 398A.09.
History: 1980 c 616 s 1; 1983 c 216 art 1 s 66

398A.02 PURPOSE.
The purpose of the Regional Railroad Authorities Act is to provide a means whereby one
or more municipalities, with state and federal aids as may be available, may provide for the
preservation and improvement of local rail service for agriculture, industry, or passenger traffic
and provide for the preservation of abandoned rail right-of-way for future transportation uses,
when determined to be practicable and necessary for the public welfare, particularly in the case
of abandonment of local rail lines.
History: 1980 c 616 s 2; 1983 c 326 s 11; 1989 c 299 s 10

398A.03 ORGANIZATION OF AUTHORITY.
    Subdivision 1. Organization resolution. A regional railroad authority may be organized by
resolution or joint resolution adopted by the governing body or bodies of one or more counties.
The governing body or bodies of a municipality or municipalities within a county or counties may
request by resolution that the county or counties organize a railroad authority. If the county or
counties do not organize an authority within 90 days of receipt of the request, the municipality
or municipalities may organize an authority by resolution or joint resolution. A resolution
organizing an authority must state:
(a) that the authority is organized under the Regional Railroad Authorities Act as a political
subdivision and local government unit of Minnesota, to exercise thereunder part of the sovereign
power of the state;
(b) the name of the authority, including the words "regional railroad authority";
(c) the municipality or municipalities adopting the organization resolution;
(d) the number of commissioners of the authority, not less than five; the number to be
appointed by the governing body of each municipality; and the names and addresses of the first
board of commissioners;
(e) the city and county in which the registered office of the authority is to be situated;
(f) that neither the state of Minnesota, the municipality or municipalities, nor any other
political subdivision is liable for obligations of the authority; and
(g) any other provision for regulating the business of the authority determined by the
governing body or bodies adopting the resolution.
    Subd. 2. Hearing. Before final adoption of an organization resolution, the governing body
of each municipality named in it shall provide for a public hearing upon notice published in a
newspaper of general circulation in the municipality. The notice of a hearing by the governing
body of a county must be mailed to the governing body of each city or town in the county, except
cities and towns participating in the organization, at least 30 days before the hearing. The hearing
may be adjourned from time to time, to a time and place publicly announced at the hearing,
or to a time and place fixed by notice published in a newspaper of general circulation in the
municipality at least ten days before the adjourned session. Joint hearing sessions may be held by
the governing bodies of all municipalities named, at any convenient public place within any of the
municipalities. The resolution may be amended by the governing body or bodies at or after any
hearing session at which the amended resolution is proposed and made available to interested
citizens. It shall not become effective until adopted in identical form by the governing bodies
of all municipalities named in the resolution.
    Subd. 3. Certificate of incorporation. A copy of the organization resolution, certified by
the recording officer of each municipality adopting it, shall be filed with the secretary of state,
who shall issue a certificate of incorporation if the resolution conforms to the requirements of this
section, stating in the certificate the name of the authority and the date of its incorporation, which
shall be the date of acceptance for filing. The certificate of incorporation shall be conclusive
evidence of the valid organization and existence of the authority.
    Subd. 4. Amendment. The organization resolution may be amended by resolution or
joint resolution of the governing bodies of all municipalities named in the resolution prior to
amendment and the governing body of any additional municipality named in the amendment.
Each amendment shall be adopted at or after hearing upon notice as required for the organization
resolution. No amendment releasing a municipality from its obligations as a party named in the
resolution shall be effective unless all covenants, agreements, mortgage liens, and other security
given for bonds of the authority have been discharged and satisfied by payment or otherwise in
accordance with their terms. All other amendments shall take effect upon filing with the secretary
of state and issuance of an amended certificate of incorporation in the same manner as provided
for the organization resolution.
    Subd. 5. Board of commissioners. All powers granted to an authority shall be exercised by
its board of commissioners. Commissioners shall be appointed and vacancies in their office shall
be filled by the governing body of each municipality named in the organization resolution, in
accordance with the provisions of that resolution. The term of each commissioner shall be one
year, or the remainder of the one year term for which a vacancy is filled, and until a successor is
appointed. Commissioners shall receive no compensation for services but shall be reimbursed for
necessary expenses incurred in the performance of their duties.
    Subd. 6. Meetings and actions. The board of commissioners shall by resolution establish the
time and place or places of its regular meetings and the method and notice required for calling
special meetings, all of which shall be open to the public. A majority of the commissioners being
present at a meeting, any action may be taken by resolution or motion adopted by recorded vote of
a majority of those present, unless a larger majority is required by bylaws adopted by the board.
    Subd. 7. Officers and employees. The board of commissioners shall appoint a chair,
vice-chair, secretary, and treasurer from its members, each to serve for a term of one year and
until a successor is appointed. The offices of secretary and treasurer may be combined, and
deputies or assistants may be appointed for either office or the combined office, from members of
the board or otherwise. The powers and duties of each office shall be determined by the board,
which shall require and pay for a surety bond for each officer handling funds. The board shall
provide for the keeping of a full and accurate record of all proceedings and of resolutions,
regulations, and orders issued or adopted; the state auditor shall, as time and resources permit,
annually audit the books of said regional railroad authority. The board may appoint an executive
director and other officers, fix their compensation, and delegate to them the powers and duties,
as it may determine. It may also employ, or authorize the executive director to employ, all other
employees, consultants, and agents needed to perform its duties and exercise its powers. Chapter
353 shall apply to all salaried employees.
History: 1980 c 616 s 3; 1983 c 326 s 12; 1986 c 444

398A.04 POWERS.
    Subdivision 1. General. An authority may exercise all the powers necessary or desirable to
implement the powers specifically granted in this section, and in exercising the powers is deemed
to be performing an essential governmental function and exercising a part of the sovereign power
of the state, and is a local government unit and political subdivision of the state. Without limiting
the generality of the foregoing, the authority may:
(a) sue and be sued, have a seal, which may but need not be affixed to documents as directed
by the board, make and perform contracts, and have perpetual succession;
(b) acquire real and personal property within or outside its taxing jurisdiction, by purchase,
gift, devise, condemnation, conditional sale, lease, lease purchase, or otherwise; or for purposes,
including the facilitation of an economic development project pursuant to section 383B.81 or
469.091 or 469.175, subdivision 7, that also improve rail service;
(c) hold, manage, control, sell, convey, lease, mortgage, or otherwise dispose of real or
personal property; and
(d) make grants or otherwise appropriate funds to the Department of Transportation, the
Metropolitan Council, or any other state or local governmental unit for the purposes described
in subdivision 2 with respect to railroad facilities located or to be located within the authority's
jurisdiction, whether or not the facilities will be acquired, constructed, owned, or operated by the
authority.
    Subd. 2. Railroad acquisition and operation. The authority may plan, establish, acquire,
develop, construct, purchase, enlarge, extend, improve, maintain, equip, operate, regulate, and
protect railroads and railroad facilities, including but not limited to terminal buildings, roadways,
crossings, bridges, causeways, tunnels, equipment, and rolling stock. The authority may not
expend state or federal funds to engage in planning for or development of light rail transit or
commuter rail transit, unless this activity is consistent with a plan adopted by the department of
transportation under section 174.84 and a plan adopted by the metropolitan council under section
473.399, and is carried out pursuant to a memorandum of understanding executed by the authority
and the commissioner after appropriate consultation with the metropolitan council.
    Subd. 3. Permits. The authority may apply to any public agency for permits, consents,
authorizations, and approvals required for any project and take all actions necessary to comply
with their conditions.
    Subd. 4. Eminent domain. The authority shall have all powers granted to a political
subdivision in chapter 117 for the acquisition of property for a public purpose, except that it
shall have no power of eminent domain with respect to property owned by another authority or
political subdivision of Minnesota or any other state, or with respect to property owned or used
by a railroad corporation unless the Interstate Commerce Commission or a successor agency, if
any, or another authority with power to make the finding, has found that the public convenience
and necessity permit discontinuance of rail service on the property. All property taken for the
exercise of the powers granted herein is declared to be taken for a public governmental purpose
and as a matter of public necessity.
    Subd. 5. Funds. The authority may establish charges and rentals for the use, sale, and
availability of its property and service and may hold, use, dispose of, invest, and reinvest the
income, revenues, and funds derived therefrom. Subject to any agreement with bondholders, it
may invest money not required for immediate use, including bond proceeds, in the securities it
shall deem prudent, notwithstanding the provisions of any other law relating to the investment
of public funds.
    Subd. 6. Insurance and indemnity. (a) The authority shall be subject to tort liability to the
extent provided in chapter 466 and may procure insurance against the liability, and may indemnify
and purchase and maintain insurance on behalf of any of its commissioners, officers, employees,
or agents, in connection with any threatened, pending, or completed action, suit, or proceeding,
as provided in chapter 466, and to the same extent and in the same manner and with the same
force and effect as provided in the case of a private corporation by section 302A.521. It may
also procure insurance against loss of or damage to property in the amounts, by reason of the
risks, and from the insurers as it deems prudent.
(b) A railroad leasing its tracks and right-of-way to a railroad authority that is created under
this chapter and affiliated with a railroad museum is subject to tort liability only to the extent
provided for municipalities in chapter 466 as to any claims arising out of fare-paying passenger
operations carried on by the railroad authority primarily for the purpose of promoting tourism on
tracks and right-of-way leased from the railroad.
    Subd. 7. Grants. The authority may accept, contract for, and receive and disburse federal,
state, and other funds or property, public or private, made available by grant, loan, or lease, to
be used in the exercise of any of its powers, and may comply with the terms and conditions
of the grant or loan.
    Subd. 8. Taxation. Before deciding to exercise the power to tax, the authority shall give six
weeks' published notice in all municipalities in the region. If a number of voters in the region
equal to five percent of those who voted for candidates for governor at the last gubernatorial
election present a petition within nine weeks of the first published notice to the secretary of state
requesting that the matter be submitted to popular vote, it shall be submitted at the next general
election. The question prepared shall be:
"Shall the regional rail authority have the power to impose a property tax?

		Yes
		No "

If a majority of those voting on the question approve or if no petition is presented within the
prescribed time the authority may levy a tax at any annual rate not exceeding 0.04835 percent of
market value of all taxable property situated within the municipality or municipalities named in
its organization resolution. Its recording officer shall file, on or before September 15, in the office
of the county auditor of each county in which territory under the jurisdiction of the authority is
located a certified copy of the board of commissioners' resolution levying the tax, and each county
auditor shall assess and extend upon the tax rolls of each municipality named in the organization
resolution the portion of the tax that bears the same ratio to the whole amount that the net tax
capacity of taxable property in that municipality bears to the net tax capacity of taxable property
in all municipalities named in the organization resolution. Collections of the tax shall be remitted
by each county treasurer to the treasurer of the authority. For taxes levied in 1991, the amount
levied for light rail transit purposes under this subdivision shall not exceed 75 percent of the
amount levied in 1990 for light rail transit purposes under this subdivision.
    Subd. 9. Agreements. The authority may enter into joint powers agreements under section
471.59 or other agreements with the municipality or municipalities named in the organization
agreement; with other municipalities situated in the counties named in the resolution, respecting
the matters referred to in section 398A.06; with another authority; with a state agency; or with the
Metropolitan Council about any matter subject to this chapter.
    Subd. 10. Bonds. The authority may issue bonds in the manner and upon the conditions
provided in section 398A.07.
    Subd. 11. Contracts for operation and use of facilities. The authority may enter into
contracts including leases with any person, firm, or corporation, for terms the authority may
determine:
(a) providing for the operation of any facilities on behalf of the authority, at the rate of
compensation as may be determined;
(b) leasing a rail line for operation by the lessee or any facility or space therein for other
commercial purposes, at rentals as may be determined, but no person may be authorized to
operate a rail line other than as a common carrier;
(c) granting the privilege, for compensation as the authority shall determine, of supplying
goods, commodities, services, or facilities along rail lines or in or upon other property; and
(d) making available services furnished by the authority or its agents, at charges, rentals, or
fees which shall be reasonable and uniform for the same class of privilege or service.
History: 1980 c 616 s 4; 1983 c 326 s 13,14; 1986 c 455 s 63; 1987 c 405 s 1; 1988 c 719 art
5 s 84; 1989 c 277 art 4 s 43; 1989 c 329 art 13 s 20; 1989 c 339 s 2; 1991 c 291 art 4 s 8; 1994 c
416 art 1 s 44; 1997 c 231 art 16 s 17; 1999 c 230 s 31-33; 2003 c 2 art 4 s 18; 2005 c 69 art 3 s 24

398A.05 TAX EXEMPTION.
The property and income of an authority shall be exempt from all taxation, except that
sections 272.01, subdivision 2, and 273.19 shall apply to any use or lease of the property, other
than operation of a railroad line by a railroad company.
History: 1980 c 616 s 5

398A.06 MUNICIPAL POWERS.
    Subdivision 1. General. Any county named in the organization resolution of an authority,
and any other municipality situated within a named county, may exercise the powers granted in
this section, in aid or in consideration of the exercise of the authority's powers in ways which
are determined by the governing body of the municipality to be for the benefit and welfare of
its citizens.
    Subd. 2. Loans and donations. The municipality may lend or donate money to the authority
and may levy taxes, appropriate money, and issue bonds for that purpose in the manner and within
the limitations prescribed by law, including but not limited to chapter 475.
    Subd. 3. Joint action. The municipality may enter into an agreement with the authority
respecting the joint exercise of their powers pursuant to section 471.59.
    Subd. 4. Public improvements. The municipality may cause water, sewer, storm sewer,
drainage, street, highway and sidewalk, or other public improvements to be furnished adjacent to
or in connection with property of the authority; but the property shall be exempt from special
assessment as in the case of highway rights-of-way pursuant to section 435.19.
    Subd. 5. Conveyance of property. The municipality may dedicate, sell, convey, or lease
to the authority its interest in any property and may grant easements, licenses, and other rights
in it to the authority.
History: 1980 c 616 s 6; 1992 c 511 art 5 s 12

398A.07 BONDS.
    Subdivision 1. Authorization. An authority may from time to time issue bonds, or other
obligations however designated, in principal amounts as it shall deem necessary to fulfill its
purpose and to exercise any of its powers, to provide funds for operating expenses in anticipation
of revenues of the current year, or for capital expenditures in anticipation of the issuance of long
term bonds or the receipt of a grant or loan of state or federal funds, to refund the principal of
or interest or redemption premiums on outstanding bonds whether or not the amounts refunded
have become due and payable, to establish or increase reserves to secure the payment of bonds or
interest on them, and to pay costs and expenses of the issuance of the bonds.
    Subd. 2. Security. Bonds may be made payable exclusively from the revenues from one or
more projects, or from one or more revenue producing contracts, or from the authority's revenues
generally, including but not limited to specified taxes which the authority may levy or which a
particular municipality may agree to levy for a specified purpose, and may be additionally secured
by a pledge of any grant, subsidy, or contribution from any public agency, including but not limited
to a participating municipality, or any income or revenues from any source. They may be secured
by a mortgage or deed of trust of the whole or any part of the property of the authority. They shall
be payable solely from the revenues, funds, and property pledged or mortgaged for their payment.
No commissioner, officer, employee, agent, or trustee of the authority shall be liable personally
on its bonds or be subject to any personal liability or accountability by reason of their issuance.
Neither the state nor a county or other municipality except the authority may pledge its faith and
credit or taxing power or shall be obligated in any manner for the payment of the bonds or interest
on them, except as specifically provided by agreement under section 398A.06; but nothing herein
shall affect the obligation of the state or municipality to perform any contract made by it with the
authority, and when the authority's rights under a contract with the state or a municipality are
pledged by the authority for the security of its bonds, the holders or a bond trustee may enforce
the rights as a third party beneficiary. All bonds shall be negotiable within the meaning and for the
purposes of the Uniform Commercial Code, subject only to any registration requirement.
    Subd. 3. Bond resolution or indenture. Bonds of the authority shall be authorized by
resolutions of its board of commissioners which may set forth, or may authorize and direct the
execution of an indenture or security agreement with a corporate trustee setting forth, the terms
and conditions thereof, the covenants and agreements entered into by the authority for their
security, the real and personal property, if any, which is mortgaged or pledged for their further
security, the rights and duties of the trustee, if any, and the manner of and conditions for adoption
of amending or supplemental resolutions or indentures. Covenants may be made regarding:
(a) the custody, collection, securing, investment, reinvestment, and disbursement of bond
proceeds and any revenues with respect to which the authority has any right or interest;
(b) the purposes to which the proceeds shall be applied, and the pledge of the proceeds, until
so applied, to secure the payment of the bonds and interest thereon;
(c) the rentals, rates, or charges to be established for use and availability of the authority's
property or service;
(d) the establishment of funds or accounts for the disbursement of proceeds, the segregation
of revenues, and the debt service and reserve requirements of the bonds;
(e) the conditions for the issuance of any additional bonds and the refunding of outstanding
bonds and the terms upon which additional bonds may be issued and secured;
(f) the priority of any bonds with respect to any pledge of revenues, mortgage, or security
interest;
(g) the operation and maintenance of any property, the revenues of which are pledged;
(h) the custody of any of the authority's property or investments, its safekeeping, the kinds of
securities in which funds may be invested and reinvested, the insurance to be carried on property
and against liability, and the use and disposition of insurance proceeds;
(i) the vesting in a corporate trustee, within or outside the state, and successors and
individual cotrustees as may be provided for, of funds and properties and trust rights and powers
as the authority may determine, and the limitation of the rights, powers, duties, and obligations
of the trustees;
(j) the appointment of any paying agent within or outside the state; and
(k) any other matter reasonably related to the security of the bonds.
    Subd. 4. Sale. Bonds may be issued and sold in one or more series, at public and private sale,
at the price, bearing the date or dates, maturing at the time or times, bearing interest at the rate
or rates, in the denominations, in the form whether coupon or registered, with the privileges of
conversion, exchange, and registration of transfer, having the rank or priority, to be executed on
behalf of the authority by the officers and other persons, to be subject to the terms of redemption
with or without premium, and to contain or be subject to the other terms the resolution, indenture,
or security agreement may provide, and shall not be restricted by any other law limiting the
amount, maturities, interest rates, purchase price, or other terms of obligations of public agencies
or municipalities.
    Subd. 5. Recitals. The authority shall be estopped to deny the correctness of any recital in
any bond or any certificate given by direction of the authority, that it has been issued pursuant
to the provisions and for the purposes of the Regional Railroad Authorities Act, and that all
conditions precedent to the issuance exist or have been performed.
    Subd. 6. Bonds as investments and security for deposits. Notwithstanding any other
law, the state of Minnesota and all its public officers, governmental units, agencies, and
instrumentalities, all banks, trust companies, savings banks and institutions, savings associations,
investment companies, and other persons carrying on a banking business, all insurance companies,
insurance associations, and other persons carrying on an insurance business, and all executors,
administrators, guardians, trustees and other fiduciaries may legally invest any sinking funds,
money, or other funds belonging to them or within their control in any bonds or other obligations
issued pursuant to this section, and the bonds or obligations may be pledged as security for
any public deposits.
History: 1980 c 616 s 7; 1983 c 326 s 15; 1995 c 202 art 1 s 25

398A.08 EMPLOYMENT PREFERENCE.
Individuals who have been previously employed by railroads, any part of whose property
or assets are acquired pursuant to Laws 1980, chapter 616, shall have priority, based upon their
length of service with that railroad, in employment with a purchasing carrier or other operator of a
railroad incorporating that property or those assets.
History: 1980 c 616 s 8

398A.09 CONSTRUCTION.
Sections 398A.01 to 398A.08 shall be construed liberally to effectuate their legislative
intent and purpose, as complete and independent authority for the performance of every act and
thing authorized, and all powers granted shall be broadly interpreted to effectuate this intent and
purpose and not as a limitation of powers. In the event of any conflict or inconsistency with any
other law or charter provision, the provisions of sections 398A.01 to 398A.08 shall prevail.
History: 1980 c 616 s 9