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Key: (1) language to be deleted (2) new language

CHAPTER 152--H.F.No. 2800
An act
relating to transportation finance; appropriating money for transportation
activities; providing funding for highway maintenance, debt service, and local
roads; appropriating funds for emergency relief related to the I-35W bridge
collapse; establishing a trunk highway bridge improvement program; requiring
a study of value capture to reduce the public costs of large transportation
infrastructure investment; authorizing sale and issuance of bonds; modifying
motor vehicle registration and motor fuel taxes; establishing annual surcharge on
motor fuel taxes; creating a motor fuels tax credit; allocating motor vehicle lease
tax revenues; providing for local transportation sales taxes; modifying county
state-aid highway fund revenue allocation; prohibiting tolling or privatization
of existing transportation facilities; establishing bridge improvement program;
modifying driver's license reinstatement fee provisions; regulating certain transit
funding activities; modifying provisions related to various transportation-related
funds and accounts; establishing a task force; requiring reports;amending
Minnesota Statutes 2006, sections 160.84, subdivision 1; 161.081, subdivision 3;
162.06; 162.07, subdivision 1, by adding subdivisions; 168.013, subdivision 1a;
171.29, subdivision 2; 290.06, by adding a subdivision; 296A.07, subdivision
3; 296A.08, subdivision 2; 297A.64, subdivision 2; 297A.815, by adding a
subdivision; 297A.99, subdivision 1; proposing coding for new law in Minnesota
Statutes, chapters 160; 165; 296A; 297A; 398A.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1
TRANSPORTATION APPROPRIATIONS


Section 1. SUMMARY OF APPROPRIATIONS.
    The amounts shown in this section summarize direct appropriations, by fund, made
in this article.

2008
2009
Total

General Fund
0
2,775,000
2,775,000

Trunk Highway
55,000,000
163,250,000
218,250,000

C.S.A.H.
0
50,173,000
50,173,000

M.S.A.S.
0
13,179,000
13,179,000

Total
$
55,000,000
$
229,377,000
$
284,377,000


Sec. 2. TRANSPORTATION APPROPRIATIONS.
    The sums shown in the columns marked "Appropriations" are appropriated to
the agencies and for the purposes specified in this article. The appropriations are from
the trunk highway fund, or another named fund, and are available for the fiscal years
indicated for each purpose. The figures "2008" and "2009" used in this article mean that
the appropriations listed under them are available for the fiscal year ending June 30, 2008,
or June 30, 2009, respectively. "The first year" is fiscal year 2008. "The second year" is
fiscal year 2009. "The biennium" is fiscal years 2008 and 2009. Appropriations for fiscal
year 2008 are effective the day following final enactment.
    The appropriations are in addition to appropriations under Laws 2007, chapter 143,
article 1, section 3, and Laws 2007, First Special Session chapter 2, article 2, section 2.

APPROPRIATIONS

Available for the Year

Ending June 30

2008
2009


Sec. 3. TRANSPORTATION

Subdivision 1.Total Appropriation
$
0
$
148,399,000

Appropriations by Fund

2008
2009

General Fund
0
2,450,000

Trunk Highway
0
82,597,000

C.S.A.H.
0
50,173,000

M.S.A.S.
0
13,179,000
The amounts that may be spent for each
purpose are specified in the following
subdivisions.

Subd. 2.Multimodal Systems

(a) Transit
0
1,700,000
This appropriation is from the general fund.
This is a onetime appropriation.

(b) Rail
0
250,000
This appropriation is from the general
fund for a grant to the Northstar Corridor
Development Authority to fund advanced
preliminary engineering, updated
environmental documentation, property
appraisals, and negotiations with the railroad
to extend commuter rail service on the
Burlington Northern Santa Fe rail line
between Big Lake and Rice. This is a
onetime appropriation and is available until
spent.

(c) Port Development Assistance
0
500,000
This appropriation is from the general fund
for grants under Minnesota Statutes, chapter
457A. Any improvements made with the
proceeds of these grants must be publicly
owned. This is a onetime appropriation.

Subd. 3.State Roads

(a) Infrastructure Operations and Maintenance
0
41,352,000

(b) Infrastructure Investment Support
0
34,034,000
$200,000 is for a grant to the Hubert H.
Humphrey Institute of Public Affairs for its
participation in the United States Department
of Transportation Urban Partnership
program. This is a onetime appropriation.

(c) Highway Debt Service
0
7,211,000
This appropriation is for transfer to the state
bond fund. If this appropriation is insufficient
to make all transfers required in the year for
which it is made, the commissioner of finance
shall notify the Committee on Finance of
the senate and the Committee on Ways and
Means of the house of representatives of
the amount of the deficiency and shall then
transfer that amount under the statutory open
appropriation. Any excess appropriation
cancels to the trunk highway fund.

Subd. 4.Local Roads

(a) County State Aids
0
50,173,000
This appropriation is from the county
state-aid highway fund and is available until
spent.

(b) Municipal State Aids
0
13,179,000
This appropriation is from the municipal
state-aid street fund and is available until
spent.

(c) State-Aid Appropriation Adjustments
If an appropriation under this subdivision
does not exhaust the balance in the fund
from which it is made in the year for
which it is made, the commissioner of
finance, upon request of the commissioner
of transportation, shall notify the chairs and
ranking minority members of the house of
representatives and senate committees with
jurisdiction over transportation finance of the
amount of the remainder and shall then add
that amount to the appropriation. The amount
added is appropriated for the purposes of
county state aids or municipal state aids, as
appropriate.
If the appropriations under this subdivision
exhaust the balance in the fund from
which it is made in the year for which
it is made, the commissioner of finance
shall notify the chairs and ranking minority
members of the house of representatives
and senate committees with jurisdiction
over transportation finance of the amount by
which the appropriation exceeds the balance
and shall then reduce that amount from the
appropriation.

Subd. 5.Transfers
With the approval of the commissioner of
finance, the commissioner of transportation
may transfer unencumbered balances among
the appropriations from the trunk highway
fund and the state airports fund made in this
section. No transfer may be made from the
appropriations for state road construction
or debt service to any other appropriation.
Transfers under this paragraph may not be
made between funds. Transfers between
programs must be reported immediately to
the chairs and ranking minority members
of the house of representatives and
senate committees with jurisdiction over
transportation finance.


Sec. 4. PUBLIC SAFETY
$
0
$
3,653,000
This appropriation is for the State Patrol to
add 40 troopers.

    Sec. 5. APPROPRIATION; TRANSPORTATION EMERGENCY RELIEF.
    $55,000,000 in fiscal year 2008 and $77,000,000 in fiscal year 2009 are appropriated
to the commissioner of transportation from the trunk highway fund for the purposes
specified in the federal grants and aids related to the I-35W bridge collapse on marked
Interstate Highway I-35W in Minneapolis. The appropriation in fiscal year 2009 is
available for other trunk highway construction projects. This appropriation is in addition
to appropriations under Laws 2007, chapter 143, article 1, section 3, and Laws 2007, First
Special Session chapter 2, article 2, section 2.
EFFECTIVE DATE.Appropriations for fiscal year 2008 are effective the day
following final enactment.

    Sec. 6. VALUE CAPTURE STUDY; APPROPRIATION.
    Subdivision 1. Findings. The legislature finds that large public investments in state
transportation infrastructure, such as constructing freeway interchanges, new highways,
and rail transit stations, can result in surrounding private land and other property increasing
in value, sometimes by substantial amounts. The special assessment law, Minnesota
Statutes, chapter 429, provides a method for local governments to use similar private or
special benefits to help finance local streets, roads, and other transportation improvements.
However, the law does not provide the state with a similar financing mechanism and
the nature of a large state transportation project may suggest that alternative financing
mechanisms are more appropriate.
    Subd. 2. Appropriation; study. $325,000 is appropriated from the general fund to
the Board of Regents of the University of Minnesota for the Center for Transportation
Studies to complete a study to assess the public policy implications of financing new and
improved transportation infrastructure in Minnesota through capturing the value of the
benefits created, to prepare a report on its findings, and to conduct a series of workshops.
This is a onetime appropriation and is available in fiscal years 2008 and 2009.
    Subd. 3. Report; workshops. The Center for Transportation Studies must report
its preliminary findings to the legislature by March 1, 2009, and must issue its full report
by July 1, 2009. The Center for Transportation must also offer a series of educational
workshops for elected officials during the summer and fall of 2009.
EFFECTIVE DATE.This section is effective the day following final enactment.

ARTICLE 2
TRUNK HIGHWAY AND LOCAL ROAD AND BRIDGE BONDING

    Section 1. [296A.083] DEBT SERVICE SURCHARGE.
    Subdivision 1. Definitions. For purposes of this section, the following terms have
the meanings given them:
    (1) "debt service" means the amount of principal and interest in each fiscal year
attributable to the trunk highway bonds authorized in this article; and
    (2) "surcharge" means the rate imposed under this section on gasoline taxed under
section 296A.07, subdivision 3, clause (3), and includes a proportional rate for each type
of fuel taxed under sections 296A.07, subdivision 3, clauses (1) and (2), and 296A.08,
subdivision 2.
    Subd. 2. Debt service forecast. On June 30, 2008, and each March 1 thereafter, the
commissioner of finance shall report to the commissioner of revenue on trunk highway
debt service. The report must include the annual amount of revenue from the surcharge
previously deposited in the trunk highway fund, and a forecast of the total and annual
amounts necessary to pay the remaining debt service.
    Subd. 3. Surcharge rate. (a) By July 16, 2008, and each April 1 thereafter, the
commissioner of revenue shall calculate and publish a surcharge as provided in paragraphs
(b) and (c). The surcharge is imposed from August 1, 2008, through June 30, 2009, and
each new surcharge thereafter is imposed the following July 1 through June 30.
    (b) For fiscal years 2009 through 2012, the commissioner shall set the surcharge as
specified in the following surcharge rate schedule.

Surcharge Rate Schedule


Fiscal Year
Rate (in cents
per gallon)

2009
0.5

2010
2.1

2011
2.5

2012
3.0
    (c) For fiscal year 2013 and thereafter, the commissioner shall set the surcharge at
the lesser of (1) 3.5 cents, or (2) an amount calculated so that the total proceeds from the
surcharge deposited in the trunk highway fund from fiscal year 2009 to the upcoming
fiscal year equals the total amount of debt service from fiscal years 2009 to 2039, and the
surcharge is rounded to the nearest 0.1 cent.
EFFECTIVE DATE.This section is effective the day following final enactment.


Sec. 2. BOND APPROPRIATIONS.
    The sums shown in the column under "APPROPRIATIONS" are appropriated from
the bond proceeds account in the trunk highway fund, or another named fund, to the state
agencies or officials indicated, to be spent for public purposes. Appropriations of bond
proceeds must be spent as authorized by the Minnesota Constitution, articles XI and XIV.

SUMMARY

Department of Transportation
$
1,841,403,000

Metropolitan Council
400,000

Department of Administration
18,197,000

Department of Finance
1,860,000

TOTAL
$
1,861,860,000

APPROPRIATIONS



Sec. 3. DEPARTMENT OF
TRANSPORTATION

Subdivision 1.Total Appropriation
$
1,841,403,000

Appropriations by Fund

Trunk Highway
1,781,403,000

State Transportation
60,000,000
This appropriation is to the commissioner of
transportation for the purposes specified in
this section.

Subd. 2.State Road Construction
1,717,694,000
(a) For the actual construction,
reconstruction, and improvement of
trunk highways, including design-build
contracts and consultant usage to support
these activities. This includes the cost
of actual payments to landowners for
lands acquired for highway rights-of-way,
payments to lessees, interest subsidies, and
relocation expenses. This appropriation is in
the following amounts:
(1) $417,694,000 in fiscal year 2009, and the
commissioner may use up to $71,008,000 of
this amount for program delivery;
(2) $500,000,000 in fiscal year 2010, and the
commissioner may use up to $85,000,000 of
this amount for program delivery; and
(3) $100,000,000 in each fiscal year for
fiscal years 2011 through 2018, and the
commissioner may use up to $17,000,000 of
the amount in each fiscal year for program
delivery.
(b) Of the amount in fiscal year 2009,
$40,000,000 is for construction of
interchanges involving a trunk highway,
where the interchange will promote economic
development, increase employment, relieve
growing traffic congestion, and promote
traffic safety. The amount under this
paragraph must be allocated 50 percent to
the department's metropolitan district, and 50
percent to districts in greater Minnesota.
(c) Of the amount in fiscal years 2009
and 2010, the commissioner shall
use $300,000,000 each year for predesign,
design, preliminary engineering, right-of-way
acquisition, construction, reconstruction,
and maintenance of bridges in the trunk
highway bridge improvement program under
Minnesota Statutes, section 165.14.
(d) Of the total appropriation under this
subdivision, the commissioner shall use at
least $50,000,000 for accelerating transit
facility improvements on or adjacent to trunk
highways.
(e) Of the total appropriation under this
subdivision provided to the Department of
Transportation's district 7, the commissioner
shall first expend funds as necessary to
accelerate all projects that (1) are on a trunk
highway classified as a medium priority
interregional corridor, (2) are included in the
district's long-range transportation plan, but
are not included in the state transportation
improvement program or the ten-year
highway work plan, and (3) expand capacity
from a two-lane highway to a freeway
or expressway, as defined in Minnesota
Statutes, section 160.02, subdivision 19. The
commissioner shall establish as the highest
priority under this paragraph any project that
currently has a final environmental impact
statement completed. The requirement
under this paragraph does not change the
department's funding allocation process
or the amount otherwise allocated to each
transportation district.

Subd. 3.Great River Road
4,299,000
For predesign, design, construction, and
restoration of historic roadside properties on
the Great River Road. The commissioner
shall consult with the Minnesota Mississippi
River Parkway Commission to determine
project priorities.

Subd. 4.Urban Partnership Agreement
24,778,000
For design, conversion, and construction
of (1) a high-occupancy toll lane along a
portion of marked Interstate Highway I-35W
in the counties of Dakota and Hennepin,
(2) a priced dynamic shoulder lane along a
portion of marked Interstate Highway I-35W
in Minneapolis, (3) bus-only transit along a
portion of marked Trunk Highway 77 in the
counties of Dakota and Hennepin, and (4)
related arterial traffic management projects.
This appropriation is part of the local match
of federal funding provided under the urban
partnership agreement.


Subd. 5.Mankato District Headquarters
Building
23,983,000
For design, construction, furnishing,
and equipping a new Department of
Transportation district headquarters facility
in Mankato.


Subd. 6.Chaska Truck Station - Carver
County Partnership
8,649,000
For design and construction of a new truck
station facility in Chaska, in partnership with
Carver County.


Subd. 7.Rochester and Maple Grove Truck
Stations Design
2,000,000
For design and investigative services of
new truck station facilities in Rochester and
Maple Grove.


Subd. 8.Local Bridge Replacement and
Rehabilitation
50,000,000
This appropriation is from the bond proceeds
account in the state transportation fund as
provided in Minnesota Statutes, section
174.50, to match federal money and to
replace or rehabilitate local deficient bridges.
Political subdivisions may use grants made
under this section to construct or reconstruct
bridges, including:
(1) matching federal aid grants to construct
or reconstruct key bridges;
(2) paying the costs of preliminary
engineering and environmental studies
authorized under Minnesota Statutes, section
174.50, subdivision 6a;
(3) paying the costs to abandon an existing
bridge that is deficient and in need of
replacement, but where no replacement will
be made; and
(4) paying the costs to construct a road
or street to facilitate the abandonment
of an existing bridge determined by
the commissioner to be deficient, if the
commissioner determines that construction
of the road or street is more cost efficient
than the replacement of the existing bridge.

Subd. 9.Local Road Improvement Program
10,000,000
This appropriation is from the bond proceeds
account in the state transportation fund as
provided in Minnesota Statutes, section
174.50, for grants to counties to assist in
paying the costs of rural road safety capital
improvement projects on county state-aid
highways under Minnesota Statutes, section
174.52, subdivision 4a.


Sec. 4. METROPOLITAN COUNCIL
$
400,000

Urban Partnership Agreement
This appropriation is to the Metropolitan
Council for land acquisition, design, and
construction of park-and-ride facilities along
marked Interstate Highway I-35W in the
counties of Dakota and Hennepin. This
appropriation is part of the local match of
federal funding provided under the urban
partnership agreement.



Sec. 5. DEPARTMENT OF
ADMINISTRATION
$
18,197,000

Transportation Building Exterior Repair
This appropriation is to the commissioner
of administration for repair and renovation
of the exterior of the Department of
Transportation Building at 395 John Ireland
Boulevard in St. Paul.


Sec. 6. DEPARTMENT OF FINANCE
$
1,860,000

Bond Sale Expenses
This appropriation is to the commissioner
of finance for bond sale expenses under
Minnesota Statutes, sections 16A.641,
subdivision 8, and 167.50, subdivision 4.
Of this amount, $60,000 is from the bond
proceeds account in the state transportation
fund.

    Sec. 7. BOND SALE AUTHORIZATION.
    Subdivision 1. Trunk highway fund bonds. To provide the money appropriated in
this article from the bond proceeds account in the trunk highway fund, the commissioner
of finance shall sell and issue bonds of the state in an amount up to $1,801,800,000 in the
manner, upon the terms, and with the effect prescribed by Minnesota Statutes, sections
167.50 to 167.52, and by the Minnesota Constitution, article XIV, section 11, at the times
and in the amounts requested by the commissioner of transportation. The proceeds of the
bonds, except accrued interest and any premium received from the sale of the bonds, must
be deposited in the bond proceeds account in the trunk highway fund.
    Subd. 2. State transportation fund bonds. To provide the money appropriated in
this article from the state transportation fund, the commissioner of finance shall sell and
issue bonds of the state in an amount up to $60,060,000 in the manner, upon the terms, and
with the effect prescribed by Minnesota Statutes, sections 16A.631 to 16A.675, and by
the Minnesota Constitution, article XI, sections 4 to 7. The proceeds of the bonds, except
accrued interest and any premium received on the sale of the bonds, must be credited to
a bond proceeds account in the state transportation fund.

    Sec. 8. EFFECTIVE DATE.
    Except where otherwise specified, this article is effective the day following final
enactment.

ARTICLE 3
HIGHWAY USER TAXES

    Section 1. Minnesota Statutes 2006, section 168.013, subdivision 1a, is amended to
read:
    Subd. 1a. Passenger automobile; hearse. (a) On passenger automobiles as defined
in section 168.011, subdivision 7, and hearses, except as otherwise provided, the tax shall
be $10 plus an additional tax equal to 1.25 percent of the base value.
    (b) Subject to the classification provisions herein, "base value" means the
manufacturer's suggested retail price of the vehicle including destination charge using list
price information published by the manufacturer or determined by the registrar if no
suggested retail price exists, and shall not include the cost of each accessory or item of
optional equipment separately added to the vehicle and the suggested retail price.
    (c) If the manufacturer's list price information contains a single vehicle identification
number followed by various descriptions and suggested retail prices, the registrar shall
select from those listings only the lowest price for determining base value.
    (d) If unable to determine the base value because the vehicle is specially constructed,
or for any other reason, the registrar may establish such value upon the cost price to the
purchaser or owner as evidenced by a certificate of cost but not including Minnesota sales
or use tax or any local sales or other local tax.
    (e) The registrar shall classify every vehicle in its proper base value class as follows:

FROM
TO

$ 0
$ 199.99

$200
$399.99
and thereafter a series of classes successively set in brackets having a spread of $200
consisting of such number of classes as will permit classification of all vehicles.
    (f) The base value for purposes of this section shall be the middle point between
the extremes of its class.
    (g) The registrar shall establish the base value, when new, of every passenger
automobile and hearse registered prior to the effective date of Extra Session Laws 1971,
chapter 31, using list price information published by the manufacturer or any nationally
recognized firm or association compiling such data for the automotive industry. If unable
to ascertain the base value of any registered vehicle in the foregoing manner, the registrar
may use any other available source or method. The registrar shall calculate tax using base
value information available to dealers and deputy registrars at the time the application for
registration is submitted. The tax on all previously registered vehicles shall be computed
upon the base value thus determined taking into account the depreciation provisions of
paragraph (h).
    (h) The annual additional tax must be computed upon a percentage of the base
value as provided herein, follows: during the first and second years year of vehicle life
shall be computed, upon 100 percent of the base value; for the second year, 90 percent of
such value; for the third and fourth years year, 90 80 percent of such value; for the fourth
year, 70 percent of such value; for the fifth and sixth years year, 75 60 percent of such
value; for the sixth year, 50 percent of such value; for the seventh year, 60 40 percent of
such value; for the eighth year, 40 30 percent of such value; for the ninth year, 30 20
percent of such value; for the tenth year, ten percent of such value; for the 11th and each
succeeding year, the sum of $25.
    (i) In no event shall the annual additional tax be less than $25. The total tax under
this subdivision shall not exceed $189 for the first renewal period and shall not exceed
$99 for subsequent renewal periods. The total tax under this subdivision on any vehicle
filing its initial registration in Minnesota in the second year of vehicle life shall not
exceed $189 and shall not exceed $99 for subsequent renewal periods. The total tax
under this subdivision on any vehicle filing its initial registration in Minnesota in the
third or subsequent year of vehicle life shall not exceed $99 and shall not exceed $99 in
any subsequent renewal period.
    (i) As used in this subdivision and section 168.017, the following terms have the
meanings given: "initial registration" means the 12 consecutive months calendar period
from the day of first registration of a vehicle in Minnesota; and "renewal periods" means
the 12 consecutive calendar months periods following the initial registration period. For
any vehicle previously registered in Minnesota, the annual additional tax due under this
subdivision must not exceed the smallest amount of annual additional tax previously
paid or due on the vehicle.
EFFECTIVE DATE.This section is effective the day following final enactment,
and applies to any annual additional tax for a registration period that starts on or after
September 1, 2008, through August 31, 2009.

    Sec. 2. Minnesota Statutes 2006, section 290.06, is amended by adding a subdivision
to read:
    Subd. 34. Lower income motor fuels tax credit. (a) An individual is allowed a
credit against the tax imposed under this chapter if the individual:
    (i) has attained the age of 18 by the end of the taxable year;
    (ii) cannot be claimed as a dependent on another taxpayer's return; and
    (iii) is (A) a United States citizen or (B) lawfully present in the United States.
For married couples filing joint returns, surviving spouses, single filers, and head of
household filers, the credit amount is $25. For married individuals filing separate returns,
the credit amount is $12.50. To qualify, the individual's taxable net income for the taxable
year must not exceed the maximum amount for the individual's filing status, adjusted as
provided in subdivision 2d, that is taxable at the lowest rate under subdivision 2c. For
individuals with taxable net income that exceeds the amount of income taxable for the
individual's filing status at the lowest rate under subdivision 2c, adjusted as provided in
subdivision 2d, the credit amount is zero. For a nonresident or part-year resident, the credit
must be allocated based on the percentage calculated under subdivision 2c, paragraph (e).
    (b) If the amount of the credit which the individual is eligible to receive under this
subdivision exceeds the individual's liability for tax under this chapter, the commissioner
of revenue shall refund the excess.
    (c) The amount necessary to pay claims for the refund provided in this section is
appropriated from the general fund to the commissioner.
EFFECTIVE DATE.This section is effective for taxable years beginning after
December 31, 2008.

    Sec. 3. Minnesota Statutes 2006, section 296A.07, subdivision 3, is amended to read:
    Subd. 3. Rate of tax. The gasoline excise tax is imposed at the following rates:
    (1) E85 is taxed at the rate of 14.2 17.75 cents per gallon;
    (2) M85 is taxed at the rate of 11.4 14.25 cents per gallon; and
    (3) all other gasoline is taxed at the rate of 20 25 cents per gallon.
EFFECTIVE DATE.This section is effective October 1, 2008, and applies to all
gasoline, undyed diesel fuel, and special fuel in distributor storage on that date.

    Sec. 4. GASOLINE EXCISE TAX; TRANSITION PROVISION.
    Notwithstanding Minnesota Statutes, section 296A.07, subdivision 3, before October
1, 2008, the gasoline excise tax is imposed at the following rates:
    (1) E85 is taxed at the rate of 15.62 cents per gallon;
    (2) M85 is taxed at the rate of 12.54 cents per gallon; and
    (3) all other gasoline is taxed at the rate of 22 cents per gallon.
EFFECTIVE DATE.This section is effective on the first day of the month following
21 days after the date of enactment and applies to all gasoline, undyed diesel fuel, and
special fuel in distributor storage on that date. This section expires October 1, 2008.

    Sec. 5. Minnesota Statutes 2006, section 296A.08, subdivision 2, is amended to read:
    Subd. 2. Rate of tax. The special fuel excise tax is imposed at the following rates:
    (a) Liquefied petroleum gas or propane is taxed at the rate of 15 18.75 cents per
gallon.
    (b) Liquefied natural gas is taxed at the rate of 12 15 cents per gallon.
    (c) Compressed natural gas is taxed at the rate of $1.739 $2.174 per thousand cubic
feet; or 20 25 cents per gasoline equivalent,. For purposes of this paragraph, "gasoline
equivalent," as defined by the National Conference on Weights and Measures, which is
5.66 pounds of natural gas.
    (d) All other special fuel is taxed at the same rate as the gasoline excise tax as
specified in section 296A.07, subdivision 2. The tax is payable in the form and manner
prescribed by the commissioner.
EFFECTIVE DATE.This section is effective October 1, 2008, and applies to all
gasoline, undyed diesel fuel, and special fuel in distributor storage on that date.

    Sec. 6. SPECIAL FUEL EXCISE TAX; TRANSITION PROVISION.
    Notwithstanding Minnesota Statutes, section 296A.08, subdivision 2, before October
1, 2008, the special fuel excise tax is imposed at the following rates:
    (a) Liquefied petroleum gas or propane is taxed at the rate of 16.5 cents per gallon.
    (b) Liquefied natural gas is taxed at the rate of 13.2 cents per gallon.
    (c) Compressed natural gas is taxed at the rate of $1.1913 per thousand cubic feet; or
22 cents per gasoline equivalent. For purposes of this paragraph, "gasoline equivalent," as
defined by the National Conference on Weights and Measures, is 5.66 pounds of gas.
    (d) All other special fuel is taxed at the same rate as the gasoline excise tax as
specified in section 4. The tax is payable in the form and manner prescribed by the
commissioner.
EFFECTIVE DATE.This section is effective on the first day of the month following
21 days after the date of enactment, and applies to all gasoline, undyed diesel fuel, and
special fuel in distributor storage on that date. This section expires October 1, 2008.

    Sec. 7. Minnesota Statutes 2006, section 297A.64, subdivision 2, is amended to read:
    Subd. 2. Fee imposed. A fee equal to three five percent of the sales price is imposed
on leases or rentals of vehicles subject to the tax under subdivision 1. The lessor on the
invoice to the customer may designate the fee as "a fee imposed by the State of Minnesota
for the registration of rental cars."

    Sec. 8. Minnesota Statutes 2006, section 297A.815, is amended by adding a
subdivision to read:
    Subd. 3. Motor vehicle lease sales tax revenue. (a) For purposes of this
subdivision, "net revenue" means an amount equal to:
    (1) the revenues, including interest and penalties, collected under section 297A.815,
during the fiscal year; less
    (2) the estimated reduction in individual income tax receipts and the estimated
amount of refunds paid out under section 290.06, subdivision 34, for the fiscal year.
    (b) On or before June 30 of each fiscal year, the commissioner of revenue shall
estimate the amount of the revenues and subtraction under paragraph (a) for the current
fiscal year.
    (c) On or after July 1 of the subsequent fiscal year, the commissioner of finance shall
transfer the net revenue as estimated in paragraph (b) from the general fund, as follows:
    (1) 50 percent to the greater Minnesota transit account; and
    (2) 50 percent to the county state-aid highway fund. Notwithstanding any other law
to the contrary, the commissioner of transportation shall allocate the funds transferred
under this clause to the counties in the metropolitan area, as defined in section 473.121,
subdivision 4, excluding the counties of Hennepin and Ramsey, so that each county shall
receive of such amount the percentage that its population, as defined in section 477A.011,
subdivision 3, estimated or established by July 15 of the year prior to the current calendar
year, bears to the total population of the counties receiving funds under this clause.
    (d) For fiscal years 2010 and 2011, the amount under paragraph (a), clause (1), must
be calculated using the following percentages of the total revenues:
    (1) for fiscal year 2010, 83.75 percent; and
    (2) for fiscal year 2011, 93.75 percent.
EFFECTIVE DATE.This section is effective July 1, 2009.

ARTICLE 4
LOCAL OPTION TAXES

    Section 1. Minnesota Statutes 2006, section 297A.99, subdivision 1, is amended to
read:
    Subdivision 1. Authorization; scope. (a) A political subdivision of this state may
impose a general sales tax (1) under section 297A.992, (2) under section 297A.993, (3) if
permitted by special law, or (4) if the political subdivision enacted and imposed the tax
before the effective date of section 477A.016 and its predecessor provision.
    (b) This section governs the imposition of a general sales tax by the political
subdivision. The provisions of this section preempt the provisions of any special law:
    (1) enacted before June 2, 1997, or
    (2) enacted on or after June 2, 1997, that does not explicitly exempt the special law
provision from this section's rules by reference.
    (c) This section does not apply to or preempt a sales tax on motor vehicles or a
special excise tax on motor vehicles.

    Sec. 2. [297A.992] METROPOLITAN TRANSPORTATION AREA SALES TAX.
    Subdivision 1. Definitions. For purposes of this section, the following terms have
the meanings given them:
    (1) "metropolitan transportation area" means the counties participating in the joint
powers agreement under subdivision 3;
    (2) "eligible county" means the county of Anoka, Carver, Dakota, Hennepin,
Ramsey, Scott, or Washington;
    (3) "committee" means the Grant Evaluation and Ranking System (GEARS)
Committee;
    (4) "minimum guarantee county" means any metropolitan county or eligible county
that is participating in the joint powers agreement under subdivision 3, whose proportion
of the annual sales tax revenue under this section collected within that county is less
than or equal to three percent; and
    (5) "population" means the population, as defined in section 477A.011, subdivision
3, estimated or established by July 15 of the year prior to the calendar year in which
the representatives will serve on the Grant Evaluation and Ranking System Committee
established under subdivision 5.
    Subd. 2. Authorization; rates. (a) Notwithstanding section 297A.99, subdivisions
1, 2, and 3, or 477A.016, or any other law, the board of a county participating in a
joint powers agreement as specified in this section shall impose by resolution (1) a
transportation sales and use tax at a rate of one-quarter of one percent on retail sales and
uses taxable under this chapter, and (2) an excise tax of $20 per motor vehicle purchased
or acquired from any person engaged in the business of selling motor vehicles at retail,
occurring within the jurisdiction of the taxing authority. The taxes authorized are to
fund transportation improvements as specified in this section, including debt service on
obligations issued to finance such improvements pursuant to subdivision 7.
    (b) The tax imposed under this section is not included in determining if the total tax
on lodging in the city of Minneapolis exceeds the maximum allowed tax under Laws 1986,
chapter 396, section 5, as amended by Laws 2001, First Special Session chapter 5, article
12, section 87, or in determining a tax that may be imposed under any other limitations.
    Subd. 3. Joint powers agreement. Before imposing the taxes authorized in
subdivision 2, an eligible county must declare by resolution of its county board to be part
of the metropolitan transportation area and must enter into a joint powers agreement. The
joint powers agreement:
    (1) must form a joint powers board, as specified in subdivision 4;
    (2) must provide a process that allows any eligible county, by resolution of its county
board, to join the joint powers board and impose the taxes authorized in subdivision 2;
    (3) may provide for withdrawal of a participating county before final termination of
the agreement; and
    (4) may provide for a weighted voting system for joint powers board decisions.
    Subd. 4. Joint powers board. (a) The joint powers board must consist of one
or more commissioners of each county that is in the metropolitan transportation area,
appointed by its county board, and the chair of the Metropolitan Council, who must have
voting rights, subject to subdivision 3, clause (4). The joint powers board has the powers
and duties provided in this section and section 471.59.
    (b) The joint powers board may utilize no more than three-fourths of one percent of
the proceeds of the taxes imposed under this section for ordinary administrative expenses
incurred in carrying out the provisions of this section. Any additional administrative
expenses must be paid by the participating counties.
    (c) The joint powers board may establish a technical advisory group that is separate
from the GEARS Committee. The group must consist of representatives of cities, counties,
or public agencies, including the Metropolitan Council. The technical advisory group
must be used solely for technical consultation purposes.
    Subd. 5. Grant application and awards; Grant Evaluation and Ranking System
(GEARS) Committee. (a) The joint powers board shall establish a grant application
process and identify the amount of available funding for grant awards. Grant applications
must be submitted in a form prescribed by the joint powers board. An applicant must
provide, in addition to all other information required by the joint powers board, the
estimated cost of the project, the amount of the grant sought, possible sources of funding
in addition to the grant sought, and identification of any federal funds that will be utilized
if the grant is awarded. A grant application seeking transit capital funding must identify
the source of money necessary to operate the transit improvement.
    (b) The joint powers board shall establish a timeline and procedures for the award of
grants, and may award grants only to the state and political subdivisions. The board shall
define objective criteria for the award of grants, which must include, but not be limited to,
consistency with the most recent version of the transportation policy plan adopted by the
Metropolitan Council under section 473.146. The joint powers board shall maximize the
availability and use of federal funds in projects funded under this section.
    (c) The joint powers board shall establish a GEARS Committee, which must consist
of:
    (1) one county commissioner from each county that is in the metropolitan
transportation area, appointed by its county board;
    (2) one elected city representative from each county that is in the metropolitan
transportation area;
    (3) one additional elected city representative from each county for every additional
400,000 in population, or fraction of 400,000, in the county that is above 400,000 in
population; and
    (4) the chair of the Metropolitan Council Transportation Committee.
    (d) Each city representative must be elected at a meeting of cities in the metropolitan
transportation area, which must be convened for that purpose by the Association of
Metropolitan Municipalities.
    (e) The committee shall evaluate grant applications following objective criteria
established by the joint powers board, and must provide to the joint powers board a
selection list of transportation projects that includes a priority ranking.
    (f) A grant award for a transit project located within the metropolitan area, as defined
in section 473.121, subdivision 2, may be funded only after the Metropolitan Council
reviews the project for consistency with the transit portion of the Metropolitan Council
policy plan and one of the following occurs:
    (1) the Metropolitan Council finds the project to be consistent;
    (2) the Metropolitan Council initially finds the project to be inconsistent, but after a
good faith effort to resolve the inconsistency through negotiations with the joint powers
board, agrees that the grant award may be funded; or
    (3) the Metropolitan Council finds the project to be inconsistent, and submits the
consistency issue for final determination to a panel, which determines the project to be
consistent. The panel is composed of a member appointed by the chair of the Metropolitan
Council, a member appointed by the joint powers board, and a member agreed upon by
both the chair and the joint powers board.
    (g) Grants must be funded by the proceeds of the taxes imposed under this section,
bonds, notes, or other obligations issued by the joint powers board under subdivision 7.
    (h) Notwithstanding the provisions of this subdivision, in fiscal year 2009, of the
initial revenue collected under this section, the joint powers board shall allocate at least
$30,783,000 to the Metropolitan Council for operating assistance for transit.
    Subd. 6. Allocation of grant awards. (a) The board must allocate grant awards
only for the following transit purposes:
    (i) capital improvements to transit ways, including, but not limited to, commuter
rail rolling stock, light rail vehicles, and transit way buses;
    (ii) capital costs for park-and-ride facilities, as defined in section 174.256,
subdivision 2;
    (iii) feasibility studies, planning, alternatives analyses, environmental studies,
engineering, property acquisition for transit way purposes, and construction of transit
ways; and
    (iv) operating assistance for transit ways.
    (b) The joint powers board must annually award grants to each minimum guarantee
county in an amount no less than the amount of sales tax revenue collected within that
county.
    (c) No more than 1.25 percent of the total awards may be annually allocated for
planning, studies, design, construction, maintenance, and operation of pedestrian programs
and bicycle programs and pathways.
    Subd. 7. Bonds. (a) The joint powers board or any county, acting under a joint
powers agreement as specified in this section, may, by resolution, authorize, issue, and sell
its bonds, notes, or other obligations for the purpose of funding grants under subdivision
6. The joint powers board or county may also, by resolution, issue bonds to refund the
bonds issued pursuant to this subdivision.
    (b) The bonds of the joint powers board must be limited obligations, payable solely
from or secured by taxes levied under this section.
    (c) The bonds of any county may be limited obligations, payable solely from or
secured by taxes levied under this section. A county may also pledge its full faith, credit,
and taxing power as additional security for the bonds.
    (d) Bonds may be issued in one or more series and sold without an election. The
bonds shall be secured, bear the interest rate or rates or a variable rate, have the rank or
priority, be executed in the manner, be payable in the manner, mature, and be subject to
the defaults, redemptions, repurchases, tender options, or other terms, and shall be sold
in such manner as the joint powers board, the regional railroad authority, or the county
may determine.
    (e) The joint powers board or any regional railroad authority or any county may
enter into and perform all contracts deemed necessary or desirable by it to issue and secure
the bonds, including an indenture of trust with a trustee within or without the state.
    (f) Except as otherwise provided in this subdivision, the bonds must be issued and
sold in the manner provided under chapter 475.
    (g) The joint powers board or any regional railroad authority wholly within the
metropolitan transportation area also may authorize, issue, and sell its bonds, notes, or
other obligations for the purposes, and in accordance with the procedures, set forth in
section 398A.07 to fund grants as provided in subdivision 6. The bonds of any regional
railroad authority may be limited obligations, payable solely from or secured by taxes
levied under this section. A regional railroad authority may also pledge its taxing powers
as additional security for the bonds.
    Subd. 8. Allocation of revenues. After the deductions allowed in section 297A.99,
subdivision 11, the commissioner of revenue shall remit the proceeds of the taxes imposed
under this section on a monthly basis, as directed by the joint powers board under this
section.
    Subd. 9. Administration, collection, enforcement. Except as otherwise provided
in this section, the provisions of section 297A.99, subdivisions 4 and 6 to 12a, govern the
administration, collection, and enforcement of the tax authorized under this section.
    Subd. 10. Termination of taxes. (a) The taxes imposed under section 297A.99,
subdivision 1, by a county that withdraws from the joint powers agreement pursuant to
subdivision 3, clause (3), shall terminate when the county has satisfied its portion, as
defined in the joint powers agreement, of all outstanding bonds or obligations entered into
while the county was a member of the agreement.
    (b) If the joint powers agreement under subdivision 3 is terminated, the taxes
imposed under section 297A.99, subdivision 1, at the time of the agreement termination
will terminate when all outstanding bonds or obligations are satisfied. The auditors of the
counties in which the taxes are imposed shall see to the administration of this paragraph.
    Subd. 11. Report. The joint powers board shall report annually by February 1 to the
house of representatives and senate committees having jurisdiction over transportation
policy and finance concerning the revenues received and grants awarded.
    Subd. 12. Grant awards to Metropolitan Council. Any grant award under this
section made to the Metropolitan Council must supplement, and must not supplant,
operating and capital assistance provided by the state.
EFFECTIVE DATE.This section is effective the day following final enactment,
except that subdivision 2 is effective the first day of a calendar quarter beginning at least
90 days after the formation of the joint powers board under subdivision 4. This section
expires October 2, 2008, if the sales and use tax under subdivision 2 has not been imposed.

    Sec. 3. [297A.993] GREATER MINNESOTA TRANSPORTATION SALES AND
USE TAX.
    Subdivision 1. Authorization; rates. Notwithstanding section 297A.99,
subdivisions 1, 2, 3, 5, and 13, or 477A.016, or any other law, the board of a county outside
the metropolitan transportation area, as defined under section 297A.992, subdivision 1, or
more than one county outside the metropolitan transportation area acting under a joint
powers agreement, may impose (1) a transportation sales tax at a rate of up to one-half of
one percent on retail sales and uses taxable under this chapter, and (2) an excise tax of $20
per motor vehicle purchased or acquired from any person engaged in the business of selling
motor vehicles at retail, occurring within the jurisdiction of the taxing authority. The taxes
imposed under this section are subject to approval by a majority of the voters in each of
the counties affected at a general election who vote on the question to impose the taxes.
    Subd. 2. Allocation; termination. The proceeds of the taxes must be dedicated
exclusively to payment of the cost of a specific transportation project or improvement.
The transportation project or improvement must be designated by the board of the county,
or more than one county acting under a joint powers agreement. The taxes must terminate
after the project or improvement has been completed.
    Subd. 3. Administration, collection, enforcement. The administration, collection,
and enforcement provisions in section 297A.99, subdivisions 4 and 6 to 12, apply to all
taxes imposed under this section.

ARTICLE 5
COUNTY STATE-AID HIGHWAY FUND DISTRIBUTION

    Section 1. Minnesota Statutes 2006, section 162.06, is amended to read:
162.06 ACCRUALS TO COUNTY STATE-AID HIGHWAY FUND;
ACCOUNTS.
    Subdivision 1. Estimate. (a) By December 15 of each year the commissioner shall
estimate the amount of money that will be available to the county state-aid highway fund
during that fiscal year. The amount available must be based on actual receipts from July
1 through November 30, the unallocated fund balance, and the projected receipts for
the remainder of the fiscal year. The total amount available, except for deductions as
provided herein in this section, shall be apportioned by the commissioner to the counties
as hereinafter provided in section 162.07.
    (b) For purposes of this section, "amount available" means the amount estimated in
paragraph (a).
    Subd. 2. Administrative costs of department. Two percent must be deducted from
the total amount available in the county state-aid highway fund, set aside in a separate
account, and used for administrative costs incurred by the state Transportation Department
in carrying out the provisions relating to the county state-aid highway system.
    Subd. 3. Disaster account. (a) After deducting administrative costs as provided in
subdivision 2, the commissioner shall set aside each year a sum of money equal to one
percent of the remaining money in the county state-aid highway fund amount available
to provide for a disaster account; provided that the total amount of money in the disaster
account must never exceed two percent of the total sums to be apportioned to the counties.
This sum The money must be used to provide aid to any county encountering disasters
or unforeseen events affecting its county state-aid highway system, and resulting in an
undue and burdensome financial hardship.
    (b) Any county desiring aid by reason of disaster or unforeseen event shall request
the aid in the form required by the commissioner. Upon receipt of the request, the
commissioner shall appoint a board consisting of two representatives of the counties, who
must be either a county engineer or member of a county board, from counties other than the
requesting county, and a representative of the commissioner. The board shall investigate
the matter and report its findings and recommendations in writing to the commissioner.
    (c) Final determination of the amount of aid, if any, to be paid to the county from the
disaster account must be made by the commissioner. Upon determining to aid a requesting
county, the commissioner shall certify to the commissioner of finance the amount of the
aid, and the commissioner of finance shall then issue a warrant in that amount payable
to the county treasurer of the county. Money so paid must be expended on the county
state-aid highway system in accordance with the rules of the commissioner.
    Subd. 4. Research account. (a) Each year the screening board, provided for in
section 162.07, subdivision 5, may recommend to the commissioner a sum of money that
the commissioner shall set aside from the county state-aid highway fund amount available
and credit to a research account. The amount so recommended and set aside shall not
exceed one-half of one percent of the preceding year's apportionment sum distribution
amount, as defined in section 162.07, subdivision 1a.
    (b) Any money so set aside shall be used by the commissioner for the purpose of:
    (1) conducting research for improving the design, construction, maintenance and
environmental compatibility of state-aid highways and appurtenances;
    (2) constructing research elements and reconstructing or replacing research elements
that fail; and
    (3) conducting programs for implementing and monitoring research results.
    (c) Any balance remaining in the research account at the end of each year from
the sum set aside for the year immediately previous, shall be transferred to the county
state-aid highway fund.
    Subd. 5. State park road account. After deducting for administrative costs and
for the disaster account and research account as heretofore provided from the remainder
of the total sum provided for in subdivision 1, there shall be deducted from the amount
available as provided in this section, the commissioner shall deduct a sum equal to the
three-quarters of one percent of the remainder. The sum so deducted shall be set aside
in a separate account and shall be used for (1) the establishment, location, relocation,
construction, reconstruction, and improvement of those roads included in the county
state-aid highway system under Minnesota Statutes 1961, section 162.02, subdivision 6,
which border and provide substantial access to an outdoor recreation unit as defined in
section 86A.04 or which provide access to the headquarters of or the principal parking
lot located within such a unit, and (2) the reconstruction, improvement, repair, and
maintenance of county roads, city streets, and town roads that provide access to public
lakes, rivers, state parks, and state campgrounds. Roads described in clause (2) are not
required to meet county state-aid highway standards. At the request of the commissioner
of natural resources the counties wherein such roads are located shall do such work as
requested in the same manner as on any county state-aid highway and shall be reimbursed
for such construction, reconstruction, or improvements from the amount set aside by
this subdivision. Before requesting a county to do work on a county state-aid highway
as provided in this subdivision, the commissioner of natural resources must obtain
approval for the project from the County State-Aid Screening Board. The screening
board, before giving its approval, must obtain a written comment on the project from the
county engineer of the county requested to undertake the project. Before requesting a
county to do work on a county road, city street, or a town road that provides access to
a public lake, a river, a state park, or a state campground, the commissioner of natural
resources shall obtain a written comment on the project from the county engineer of
the county requested to undertake the project. Any sums paid to counties or cities in
accordance with this subdivision shall reduce the money needs of said counties or cities in
the amounts necessary to equalize their status with those counties or cities not receiving
such payments. Any balance of the amount so set aside, at the end of each year shall be
transferred to the county state-aid highway fund.
    Subd. 6. County state-aid highway revolving loan account. A county state-aid
highway revolving loan account is created in the transportation revolving loan fund. The
commissioner may transfer to the account the amount allocated under section 162.065.
Money in the account may be used to make loans. Funds in the county state-aid highway
revolving loan account may be used only for aid in the construction, improvement, and
maintenance of county state-aid highways. Funds in the account may not be used for any
toll facilities project or congestion-pricing project. Repayments and interest from loans
from the county state-aid highway revolving loan account must be credited to that account.
Money in the account is annually appropriated to the commissioner and does not lapse.
Interest earned from investment of money in this account must be deposited in the county
state-aid highway revolving loan account.

    Sec. 2. Minnesota Statutes 2006, section 162.07, subdivision 1, is amended to read:
    Subdivision 1. Formula Apportionment sum. After deducting for administrative
costs and for the disaster account and research account and state park roads as heretofore
provided, the remainder of the total sum provided for in section 162.06, subdivision 1,
shall be identified as the apportionment sum and shall be apportioned by the commissioner
to the several counties on the basis of the needs of the counties as determined in
accordance with the following formula:
     (a) The commissioner shall apportion the apportionment sum, as calculated in
subdivision 1a, to the several counties as provided in paragraphs (b) to (e).
    (a) (b) An amount equal to ten percent of the apportionment sum shall be apportioned
equally among the 87 counties.
    (b) (c) An amount equal to ten percent of the apportionment sum shall be
apportioned among the several counties so that each county shall receive of such amount
the percentage that its motor vehicle registration for the calendar year preceding the
one last past, determined by residence of registrants, bears to the total statewide motor
vehicle registration.
    (c) (d) An amount equal to 30 percent of the apportionment sum shall be apportioned
among the several counties so that each county shall receive of such amount the percentage
that its total lane-miles of approved county state-aid highways bears to the total lane-miles
of approved statewide county state-aid highways. In 1997 and subsequent years no county
may receive, as a result of an apportionment under this clause based on lane-miles rather
than miles of approved county state-aid highways, an apportionment that is less than its
apportionment in 1996.
    (d) (e) An amount equal to 50 percent of the apportionment sum shall be apportioned
among the several counties so that each county shall receive of such amount the percentage
that its money needs bears to the sum of the money needs of all of the individual counties;
provided, that the percentage of such amount that each county is to receive shall be
adjusted so that each county shall receive in 1958 a total apportionment at least ten
percent greater than its total 1956 apportionments from the state road and bridge fund;
and provided further that those counties whose money needs are thus adjusted shall
never receive a percentage of the apportionment sum less than the percentage that such
county received in 1958.

    Sec. 3. Minnesota Statutes 2006, section 162.07, is amended by adding a subdivision
to read:
    Subd. 1a. Apportionment sum and excess sum. (a) For purposes of this
subdivision, "distribution amount" means the amount identified in section 162.06,
subdivision 1, after the deductions provided for in section 162.06 for administrative costs,
disaster account, research account, and state park road account.
    (b) The apportionment sum is calculated by subtracting the excess sum, as calculated
in paragraph (c), from the distribution amount.
    (c) The excess sum is calculated as the sum of revenue within the distribution
amount:
    (1) attributed to that portion of the gasoline excise tax rate under section 296A.07,
subdivision 3, in excess of 20 cents per gallon, and to that portion of the excise tax rates
in excess of the energy equivalent of a gasoline excise tax rate of 20 cents per gallon
for E85 and M85 under section 296A.07, subdivision 3, and special fuel under section
296A.08, subdivision 2;
    (2) attributed to a change in the passenger vehicle registration tax under section
168.013, imposed on or after July 1, 2008, that exceeds (i) the amount collected in fiscal
year 2008, multiplied by (ii) the annual average United States Consumer Price Index for
the calendar year previous to the current calendar year, divided by the annual average
United States Consumer Price Index for calendar year 2007; and
    (3) attributed to that portion of the motor vehicle sales tax revenue in excess of the
percentage allocated to the county state-aid highway fund in fiscal year 2007.
    (d) For purposes of this subdivision, the United States Consumer Price Index
identified in paragraph (c) is for all urban consumers, United States city average, as
determined by the United States Department of Labor.

    Sec. 4. Minnesota Statutes 2006, section 162.07, is amended by adding a subdivision
to read:
    Subd. 1c. Excess sum. (a) The commissioner shall apportion the excess sum, as
calculated in subdivision 1a, to the several counties as provided in paragraphs (b) and (c).
    (b) An amount equal to 40 percent must be apportioned among the several counties
so that each county receives of that amount the percentage that its motor vehicle
registration for the calendar year preceding the one last past, determined by residence of
registrants, bears to the total statewide motor vehicle registration.
    (c) An amount equal to 60 percent must be apportioned among the several counties
so that each county receives of that amount the percentage that its money needs bears to
the sum of the money needs of all of the individual counties.

    Sec. 5. REVISOR'S INSTRUCTION.
    The revisor of statutes shall renumber Minnesota Statutes 2006, section 162.07,
subdivision 1, as subdivision 1b.

ARTICLE 6
OTHER TRANSPORTATION FINANCE

    Section 1. Minnesota Statutes 2006, section 160.84, subdivision 1, is amended to read:
    Subdivision 1. Scope. The terms used in sections 160.84 to 160.92 160.98 have the
meanings given them in this section and section 160.02.

    Sec. 2. [160.845] RESTRICTIONS ON TOLL FACILITY.
    (a) A road authority, including the governing body of a city, or a private operator
may not convert, transfer, or utilize any portion of a highway to impose tolls or for use
as a toll facility. A road authority, including the governing body of a city, or a private
operator may not limit operation of a commercial motor vehicle, as defined in section
169.01, subdivision 75, to a toll facility or otherwise require that a commercial motor
vehicle use the tolled portion of a highway.
    (b) This section does not apply to (1) any toll facility or high-occupancy vehicle lane
constructed, converted, or established before September 1, 2007, (2) any additional lane,
including a priced dynamic shoulder lane, high-occupancy vehicle lane, or high-occupancy
toll lane, added to a highway after September 1, 2007, and (3) any other general purpose
lane that adds capacity.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 3. [160.98] PROHIBITION ON ROAD AND BRIDGE PRIVATIZATION.
    A road authority may not sell, lease, execute a development agreement for a BOT
facility or BTO facility that transfers an existing highway lane, or otherwise relinquish
management of a highway, if the highway is retained or utilized by the buyer, lessor, or
operator for highway purposes. Nothing in this section prevents sale, reconveyance, or
easements under sections 160.274, 161.23, 161.41, 161.411, 161.431, 161.44, 161.442, or
any other similar provision.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 4. Minnesota Statutes 2006, section 161.081, subdivision 3, is amended to read:
    Subd. 3. Flexible highway account; turnback accounts. (a) The flexible highway
account is created in the state treasury. Money in the account may shall be used either
for the:
    (1) in fiscal years 2009 and 2010, 100 percent of the excess sum, as calculated in
paragraph (i), and in fiscal years 2011 and thereafter, 50 percent of the excess sum, as
calculated in paragraph (i), for counties in the metropolitan area, as defined in section
473.121, subdivision 4, but for the purposes of the calculation cities of the first class will
be excluded in the metropolitan area; and
    (2) of the amount available in the flexible highway account less the amount under
clause (1), as determined by the commissioner under this section for:
    (i) restoration of former trunk highways that have reverted to counties or to
statutory or home rule charter cities or for regular trunk highway purposes, or for trunk
highways that will be restored and subsequently turned back by agreement between the
commissioner and the local road authority;
    (ii) safety improvements on county highways, municipal highways, streets, or town
roads; and
    (iii) routes of regional significance.
    (b) For purposes of this subdivision, "restoration" means the level of effort required
to improve the route that will be turned back to an acceptable condition as determined
by agreement made between the commissioner and the county or city before the route
is turned back.
    (c) The commissioner shall review the need for funds to restore highways that
have been or will be turned back and the need for funds for the trunk highway system.
The commissioner shall determine, on a biennial basis, the percentage of this funds in
the flexible highway account to be distributed to each district, and within each district the
percentage to be used for county turnbacks, for municipal turnbacks, and for regular
trunk highway projects each of the purposes specified in paragraph (a). Money in the
account may be used for safety improvements and routes of regional significance only
after money is set aside to restore the identified turnbacks. The commissioner shall make
this determination these determinations only after meeting and holding discussions with
committees selected by the statewide associations of both county commissioners and
municipal officials. The commissioner shall, to the extent feasible, annually allocate 50
percent of the funds in the flexible highway account to the department's metropolitan
district, and 50 percent to districts in greater Minnesota.
    (d) Money that will be used for the restoration of trunk highways that have reverted
or that will revert to cities must be deposited in the municipal turnback account, which is
created in the state treasury.
    (e) Money that will be used for the restoration of trunk highways that have reverted
or that will revert to counties must be deposited in the county turnback account, which is
created in the state treasury.
    (f) Money that will be used for safety improvements must be deposited in the
highway safety improvement account, which is created in the state treasury to be used
as grants to statutory or home rule charter cities, towns, and counties to assist in paying
the costs of constructing or reconstructing city streets, county highways, or town roads
to reduce crashes, deaths, injuries, and property damage.
    (g) Money that will be used for routes of regional significance must be deposited in
the routes of regional significance account, which is created in the state treasury, and used
as grants to statutory or home rule charter cities, towns, and counties to assist in paying
the costs of constructing or reconstructing city streets, county highways, or town roads
with statewide or regional significance that have not been fully funded through other state,
federal, or local funding sources.
    (h) As part of each biennial budget submission to the legislature, the commissioner
shall describe how the money in the flexible highway account will be apportioned among
the county turnback account, the municipal turnback account, and the trunk highway
fund for routes turned back to local governments by agreement, the highway safety
improvement account, and the routes of regional significance account.
    (g) Money apportioned from the flexible highway account to the trunk highway fund
must be used for state road construction and engineering costs.
    (i) The excess sum is calculated as the sum of revenue within the flexible highway
account:
    (1) attributed to that portion of the gasoline excise tax rate under section 296A.07,
subdivision 3, in excess of 20 cents per gallon, and to that portion of the excise tax rates
in excess of the energy equivalent of a gasoline excise tax rate of 20 cents per gallon
for E85 and M85 under section 296A.07, subdivision 3, and special fuel under section
296A.08, subdivision 2;
    (2) attributed to a change in the passenger vehicle registration tax under section
168.013, imposed on or after July 1, 2008, that exceeds (i) the amount collected in fiscal
year 2008, multiplied by (ii) the annual average United States Consumer Price Index for
the calendar year previous to the current calendar year, divided by the annual average
United States Consumer Price Index for calendar year 2007; and
    (3) attributed to that portion of the motor vehicle sales tax revenue in excess of the
percentage allocated to the flexible highway account in fiscal year 2007.
    (j) For purposes of this subdivision, the United States Consumer Price Index
identified in paragraph (i), clause (2), is for all urban consumers, United States city
average, as determined by the United States Department of Labor.
EFFECTIVE DATE.Paragraph (h) is effective January 1, 2009, and the remainder
of this section is effective July 1, 2009.

    Sec. 5. [165.14] TRUNK HIGHWAY BRIDGE IMPROVEMENT PROGRAM.
    Subdivision 1. Definition. For purposes of this section, "program" means the trunk
highway bridge improvement program established under this section.
    Subd. 2. Program created. The commissioner shall develop a trunk highway bridge
improvement program for accelerating repair and replacement of trunk highway bridges
throughout the state. The program receives funding for bridge projects as specified by law.
    Subd. 3. Program requirements. (a) The commissioner shall develop an inventory
of bridges included in the program. The inventory must include all bridges on the trunk
highway system in Minnesota that are classified as fracture-critical or structurally deficient,
or constitute a priority project, as identified by the commissioner. In determining whether
a bridge is a priority project, the commissioner may consider national bridge inventory
(NBI) condition codes, bridge classification as functionally obsolete, the year in which
the bridge was built, the history of bridge maintenance and inspection report findings, the
average daily traffic count, engineering judgments with respect to the safety or condition
of the bridge, and any other factors specifically identified by the commissioner.
    (b) For each bridge included in the inventory, the commissioner must provide the
following information: a summary of the bridge, including but not limited to, county
and department district, route number, feature crossed, the year in which the bridge was
built, average daily traffic count, load rating, bridge length and deck area, and main span
type; the condition ratings for the deck, superstructure, and substructure; identification of
whether the bridge is structurally deficient, functionally obsolete, or fracture-critical; the
sufficiency rating; a brief description of the work planned for the bridge, including work
type needed; an estimate of total costs related to the bridge, which may include general
and planning cost estimates; and, the year or range of years in which the work is planned.
    Subd. 4. Prioritization of bridge projects. (a) The commissioner shall classify all
bridges in the program into tier 1, 2, or 3 bridges, where tier 1 is the highest tier. Unless
the commissioner identifies a reason for proceeding otherwise, before commencing bridge
projects in a lower tier, all bridge projects within a higher tier must to the extent feasible
be selected and funded in the approved state transportation improvement program, at
any stage in the project development process, solicited for bids, in contract negotiation,
under construction, or completed.
    (b) The classification of each tier is as follows:
    (1) tier 1 consists of any bridge in the program that (i) has an average daily traffic
count that is above 1,000 and has a sufficiency rating that is at or below 50, or (ii) is
identified by the commissioner as a priority project;
    (2) tier 2 consists of any bridge that is not a tier 1 bridge, and (i) is classified as
fracture-critical, or (ii) has a sufficiency rating that is at or below 80; and
    (3) tier 3 consists of any other bridge in the program that is not a tier 1 or tier 2 bridge.
    (c) By June 30, 2018, all tier 1 and tier 2 bridges originally included in the program
must be under contract for repair or replacement with a new bridge that contains a
load-path-redundant design, except that a specific bridge may remain in continued service
if the reasons are documented in the report required under subdivision 5.
    (d) The commissioner shall establish criteria for determining the priority of bridge
projects within each tier, and must include safety considerations as a criterion.
    Subd. 5. Statewide transportation planning report. In conjunction with each
update to the Minnesota statewide transportation plan, or at least every six years, the
commissioner shall submit a report to the chairs and ranking minority members of the
house of representatives and senate committees with jurisdiction over transportation
finance. The report must include:
    (1) an explanation of the criteria and decision-making processes used to prioritize
bridge projects;
    (2) a historical and projected analysis of the extent to which all trunk highway
bridges meet bridge performance targets;
    (3) a summary of bridge projects (i) completed in the previous six years or since the
last update to the Minnesota statewide transportation plan, and (ii) currently in progress
under the program;
    (4) a summary of bridge projects scheduled in the next four fiscal years and included
in the state transportation improvement program;
    (5) a projection of annual needs over the next 20 years;
    (6) a calculation funding necessary to meet the completion date under subdivision 4,
paragraph (c), compared to the total amount of bridge-related funding available; and
    (7) for any tier 1 fracture-critical bridge that is repaired but not replaced, an
explanation of the reasons for repair instead of replacement.
    Subd. 6. Annual report. Annually by January 15, the commissioner shall submit
a report on the program to the chairs and ranking minority members of the house of
representatives and senate committees with jurisdiction over transportation finance. The
report must include the inventory information required under subdivision 3, and an
analysis, including any recommendations for changes, of the adequacy and efficacy of
(1) the program requirements under subdivision 3, and (2) the prioritization requirements
under subdivision 4.
EFFECTIVE DATE.This section is effective the day following final enactment.

    Sec. 6. Minnesota Statutes 2006, section 171.29, subdivision 2, is amended to read:
    Subd. 2. Reinstatement fees and surcharges allocated and appropriated. (a)
An individual whose driver's license has been revoked as provided in subdivision 1,
except under section 169A.52, 169A.54, or 609.21, must pay a $30 fee before the driver's
license is reinstated.
    (b) A person whose driver's license has been revoked as provided in subdivision
1 under section 169A.52, 169A.54, or 609.21, must pay a $250 fee plus a $40 $430
surcharge before the driver's license is reinstated, except as provided in paragraph (f).
Beginning July 1, 2002, the surcharge is $145. Beginning July 1, 2003, the surcharge is
$430. The $250 fee is to be credited as follows:
    (1) Twenty percent must be credited to the driver services operating account in the
special revenue fund as specified in section 299A.705.
    (2) Sixty-seven percent must be credited to the general fund.
    (3) Eight percent must be credited to a separate account to be known as the Bureau
of Criminal Apprehension account. Money in this account may be appropriated to the
commissioner of public safety and the appropriated amount must be apportioned 80 percent
for laboratory costs and 20 percent for carrying out the provisions of section 299C.065.
    (4) Five percent must be credited to a separate account to be known as the vehicle
forfeiture account, which is created in the special revenue fund. The money in the account
is annually appropriated to the commissioner for costs of handling vehicle forfeitures.
    (c) The revenue from $50 of each the surcharge must be credited to a separate
account to be known as the traumatic brain injury and spinal cord injury account. The
revenue from $50 of the surcharge on a reinstatement under paragraph (f) is credited from
the first installment payment to the traumatic brain injury and spinal cord injury account.
The money in the account is annually appropriated to the commissioner of health to be
used as follows: 83 percent for contracts with a qualified community-based organization
to provide information, resources, and support to assist persons with traumatic brain
injury and their families to access services, and 17 percent to maintain the traumatic
brain injury and spinal cord injury registry created in section 144.662. For the purposes
of this paragraph, a "qualified community-based organization" is a private, not-for-profit
organization of consumers of traumatic brain injury services and their family members.
The organization must be registered with the United States Internal Revenue Service under
section 501(c)(3) as a tax-exempt organization and must have as its purposes:
    (1) the promotion of public, family, survivor, and professional awareness of the
incidence and consequences of traumatic brain injury;
    (2) the provision of a network of support for persons with traumatic brain injury,
their families, and friends;
    (3) the development and support of programs and services to prevent traumatic
brain injury;
    (4) the establishment of education programs for persons with traumatic brain injury;
and
    (5) the empowerment of persons with traumatic brain injury through participation
in its governance.
A patient's name, identifying information, or identifiable medical data must not be
disclosed to the organization without the informed voluntary written consent of the patient
or patient's guardian or, if the patient is a minor, of the parent or guardian of the patient.
    (d) The remainder of the surcharge must be credited to a separate account to be
known as the remote electronic alcohol-monitoring program account. The commissioner
shall transfer the balance of this account to the commissioner of finance on a monthly
basis for deposit in the general fund.
    (e) When these fees are collected by a licensing agent, appointed under section
171.061, a handling charge is imposed in the amount specified under section 171.061,
subdivision 4
. The reinstatement fees and surcharge must be deposited in an approved
depository as directed under section 171.061, subdivision 4.
    (f) A person whose driver's license has been revoked as provided in subdivision
1 under section 169A.52 or 169A.54 and who the court certifies as being financially
eligible for a public defender under section 611.17, may choose to pay 50 percent and
an additional $25 of the total amount of the surcharge and 50 percent of the fee required
under paragraph (b) to reinstate the person's driver's license, provided the person meets all
other requirements of reinstatement. If a person chooses to pay 50 percent of the total and
an additional $25, the driver's license must expire after two years. The person must pay an
additional 50 percent less $25 of the total to extend the license for an additional two years,
provided the person is otherwise still eligible for the license. After this final payment of
the surcharge and fee, the license may be renewed on a standard schedule, as provided
under section 171.27. A handling charge may be imposed for each installment payment.
Revenue from the handling charge is credited to the driver services operating account in
the special revenue fund and is appropriated to the commissioner.
    (g) Any person making installment payments under paragraph (f), whose driver's
license subsequently expires, or is canceled, revoked, or suspended before payment of
100 percent of the surcharge and fee, must pay the outstanding balance due for the initial
reinstatement before the driver's license is subsequently reinstated. Upon payment of
the outstanding balance due for the initial reinstatement, the person may pay any new
surcharge and fee imposed under paragraph (b) in installment payments as provided
under paragraph (f).
EFFECTIVE DATE.This section is effective July 1, 2009.

    Sec. 7. [398A.10] TRANSIT FUNDING.
    Subdivision 1. Capital costs. A county regional railroad authority may not
contribute more than ten percent of the capital costs of a light rail transit or commuter
rail project.
    Subd. 2. Operating and maintenance costs. A county regional railroad authority
may not contribute any funds to pay the operating and maintenance costs for a light rail
transit or commuter rail project. If a county regional railroad authority is contributing
funds for operating and maintenance costs on a light rail transit or commuter rail project
on the date of the enactment of this act, the authority may continue to contribute funds
for these purposes until January 1, 2009.
    Subd. 3. Application. This section only applies if a county has imposed the
metropolitan transportation sales and use tax under section 297A.992.
EFFECTIVE DATE.This section is effective the day after the metropolitan
transportation area sales tax is imposed under Minnesota Statutes, section 297A.992,
subdivision 2.

    Sec. 8. FUNDING FOR RAIL TRANSIT WAYS.
    In order to accelerate the development of metropolitan area rail transit projects,
reduce construction costs, provide transportation options, increase mobility, support
economic growth, and meet environmental challenges, the Metropolitan Council shall
initiate negotiations with the federal Transit Administration to secure federal funds for a
single comprehensive program of rail transit way development, to include Rush Line, Red
Rock, Southwest Corridor, and an extension of NorthStar commuter rail to St. Cloud.

    Sec. 9. TRANSPORTATION STRATEGIC MANAGEMENT AND
OPERATIONS ADVISORY TASK FORCE.
    Subdivision 1. Establishment; duties. A task force is established to advise the
governor and the legislature on management and operations strategies that will improve
efficiency in transportation. The task force must provide an assessment that identifies
strategies and makes recommendations, including any proposals for legislative changes,
to improve efficiency in (1) state transportation construction and maintenance projects,
and (2) management of state transportation infrastructure. In developing its assessment,
the task force may consider best practices in business and construction management;
efficiency concepts in academic, business, or other environments; and, how requirements
under law affect transportation efficiency. The assessment provided by the task force must
include, but is not limited to, analysis of the project development process, cost estimation,
bidding and award of contracts, contract management, cost overruns, and construction
project oversight by the Department of Transportation.
    Subd. 2. Membership. The advisory task force consists of the following members:
    (1) the commissioner of transportation, or the commissioner's designee;
    (2) the chair of the Metropolitan Council, or the chair's designee;
    (3) one person appointed by the governor as a representative of the construction
industry, who has expertise in transportation construction projects;
    (4) three persons appointed by the governor from a postsecondary academic
institution, who have expertise in applied economics, organizational efficiency, or business
management;
    (5) three persons appointed by the governor from the private sector, who have
expertise in management or corporate efficiency but would not qualify for membership
under clause (3);
    (6) two members of the house of representatives appointed by the speaker of the
house of representatives;
    (7) one person appointed by the speaker of the house of representatives who is a
member of organized labor;
    (8) two members of the senate appointed by the senate committee on rules and
administration under the rules of the senate; and
    (9) one person appointed by the senate committee on rules and administration under
the rules of the senate who is a member of organized labor.
    Subd. 3. Appointment of members. The appointments and designations authorized
by this section must be completed by August 1, 2008.
    Subd. 4. Staffing support. Upon request of the task force, the commissioner of
administration must provide meeting space and administrative services. The commissioner
of transportation shall provide information and other assistance as requested by the task
force.
    Subd. 5. Administrative provisions. (a) The commissioner of transportation, or the
commissioner's designee, must convene the initial meeting of the task force. The members
of the task force must elect a chair or cochairs at the initial meeting.
    (b) Public members of the task force serve without compensation or payment of
expenses.
    (c) The task force may accept gifts and grants, which are accepted on behalf of
the state and constitute donations to the state. Funds received under this paragraph are
appropriated to the commissioner of administration for purposes of the task force.
    (d) The task force expires May 31, 2009.
    Subd. 6. Report. By December 15, 2008, the task force shall submit a report on
transportation management and operations efficiency strategies to the governor and
to the chairs and ranking minority members of the house of representatives and senate
committees with jurisdiction over transportation policy and finance.
EFFECTIVE DATE.This section is effective the day following final enactment.
Presented to the governor February 21, 2008
Vetoed by the governor February 22, 2008
Reconsidered and approved by the legislature after the governor's veto February
25, 2008

700 State Office Building, 100 Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155 ♦ Phone: (651) 296-2868 ♦ TTY: 1-800-627-3529 ♦ Fax: (651) 296-0569