New Planning Requirement Proposed for Some Bonding Projects

The legislation proposes that local bonding projects funded by state direct appropriations (earmarks) would need to submit a maintenance plan for their expected operational lifespan.

A proposal, HF 2418 (Rep. Brad Tabke, DFL–Shakopee)/S.F. 2321 (Sen. Sandy Pappas, DFL–St. Paul), would add a new requirement for local government bonding projects that are funded individually in the state capital budget.

As introduced, the legislation includes broad provisions, such as requiring communities to establish a dedicated fund for maintaining and eventually replacing state bond-funded projects. HF 2418 has been sent to the House Capital Investment Committee for further consideration. SF 2321 is awaiting discussion in the Senate Capital Investment Committee.

Addressing concerns and refining the proposal

Variations of this concept have been brought forward for the past five sessions. The League and several state agencies have consistently opposed it, noting that it could disadvantage cities with the greatest infrastructure needs by making it harder for them to secure state funding.

Prior to the bill being heard in the House Elections Finance and Government Operations Committee on March 26, Rep. Tabke met with the League and other local government groups. Based on that discussion, he introduced a delete-all amendment (pdf), significantly narrowing the bill’s scope. The revised version: 

• Applies only to direct appropriations and not projects funded through state programs.
• Removes the mandate for replacement funding accounts or plans.
• Requires only a plan outlining how the community will maintain the funded project.

Stakeholder perspective

During testimony, the League, the Association of Small Cities, and the Minnesota Intercounty Alliance emphasized the state’s crucial role in funding local infrastructure needs, and agreed that the amendment is moving the bill in the correct direction. While they acknowledged the bill’s improved focus, they stressed the need for clarity on what a maintenance plan must include and at what stage in the legislative process it must be submitted. Ideally, both cities and the responsible state agency should have a clear and straightforward way to confirm compliance.  

Next steps

The League will continue monitoring this legislation to ensure that efforts to improve transparency and planning do not unintentionally hinder cities, especially those with fewer resources, from accessing crucial state funding. If further action occurs this session, it will be covered in the Cities Bulletin.

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