After no bill last year, capital investment law is heavy on infrastructure needs

With an emphasis on infrastructure, the 2017 capital investment law puts nearly $1 billion on the state’s credit card.

Sponsored by Rep. Dean Urdahl (R-Grove City) and Sen. David Senjem (R-Rochester), the law calls for $987.94 million in general-obligation bonding impact. It is effective May 31, 2017.

Per Article 11 of the state constitution, public debt may be issued, in part, “to acquire and to better public land and buildings and other public improvements of a capital nature and to provide money to be appropriated or loaned to any agency or political subdivision of the state for such purposes.”

By issuing bonds, the state receives a certain amount of money now and pays the bond holders back over time with interest.

Odd-numbered years are traditionally focused on establishing a state budget with a smaller bonding bill; even-numbered years are often centered on a large capital investment plan. However, a chaotic finish to the 2016 session resulted in no bill. Capital investment was also part of the unsuccessful special session discussion over the final seven months of 2016.

Urdahl said the law largely makes up for last year’s inaction, with many of the new projects for emergency needs.

This law marks the second try by the House to pass a capital investment package in 2017. An $800 million bill did not receive the needed 81 votes — it got 70 — when put to a vote May 17. By law, capital investment bills must start in the House and need three-fifths approval of each body to pass. Republicans hold a 77-57 seat advantage in the House.

Higher education

Rep. Alice Hausman (DFL-St. Paul) said that higher education needs typically account for about one-third of a capital investment law. This year’s total is about 20 percent.

The University of Minnesota will receive $119.93 million, with the largest amount being $66.67 million for a health science education facility on the Minneapolis campus “to meet the needs of the Medical School and the Academic Health Center.” Funding for a chemical sciences and advanced materials building on the Duluth campus comes in at $28.27 million, $20.6 million is for system-wide asset preservation and $4.4 million is included for a plant growth research facility on the St. Paul campus. The appropriations are for about one-third of the total projects’ costs, except for asset preservation.

Just over $92.3 million is included for the Minnesota State system, including $25 million in asset preservation.

The remainder is to be spent on seven projects, including $25.3 million for the second phase of the Education Village at Winona State University and $18.57 million to remodel Eastman Hall at St. Cloud State University “for the relocation of consolidated student health services and academic programs.” Other projects will occur at Hibbing Community College, Minnesota State Community and Technical College, Northland Community and Technical College and South Central College. Since 1992, the system has paid the debt service on one-third of project costs that are not considered asset preservation. (Art. 1, Secs. 2-3)

Other Education

Of the $3.5 million in general-obligation bonding for other education purposes, $2 million is for library construction grants and $1.5 million is to construct “a facility in Olmsted County to support the local, regional, and national literacy work of the Dyslexia Institute of Minnesota.” The law also calls for $500,000 from the General Fund to cover cost overruns for the Myles Reif Center for the Performing Arts project in Grand Rapids. Initial project funding occurred in 2014.

The Minnesota state academies will receive $2 million for asset preservation and $50,000 is included for predesign of a safety corridor at the Minnesota State Academy for the Deaf. (Art. 1, Secs. 4-5)

Health and Human Services

Phase II of the project to remodel existing facilities and develop new ones at the state security hospital in St. Peter is funded with almost $70.26 million. The facility houses and treats Minnesotans that courts have civilly committed as mentally ill and dangerous. Improvements are designed to improve staff safety and create a more therapeutic environment for patients. Money for Phase I was appropriated in 2014.

The law also provides $12 million to construct an opportunity center at the Dorothy Day Center in St. Paul “to serve as an integrated one-stop delivery system connecting persons at risk of becoming homeless, and persons working to move up and out of homelessness, and to provide services that improve their health, income, housing stability, or well-being.”

Also funded is a 16-bed psychiatric facility in Wilmar for children and adolescents; safety and security upgrades at the Anoka Metro Regional Treatment Center; upgrades to the Perspectives Family Center in St. Louis Park; creation of a regional residential crisis stabilization unit in Chaska; design for a new medical examiner’s facility in Minnetonka that will replace one near U.S. Bank Stadium and provide services for Dakota, Hennepin and Scott counties; and a Minneapolis project to provide medical, dental, mental health and wellness services for persons regardless of their ability to pay. (Art. 1, Sec. 17)

Environment and Natural Resources

The law calls for $113.2 million in spending between the Department of Natural Resources and Pollution Control Agency, including $15 million for DNR asset preservation and $1 million for reforestation and stand improvement on state forest lands.

Included in the DNR funding is almost $18.05 million for parks, state recreation area and trail development. This includes a mountain bike system in the Cuyana State Recreation Area; continued development of Lake Vermilion-Soudan Underground Mine State Park recreational facilities; continued development of the Heartland, Glacial Lakes, Camp Ripley/Veterans trails, and Gitchi-Gami and Mill Towns state trails.

Of the $15.4 million for dam repair, $6 million is for the Lake Byllesby Dam on the Cannon River and $4.4 million is “for emergencies on state-owned dams; for repairs to the Lake Bronson dam; and for state dams at Brawner, West Leaf Lake, Collinwood, Grindstone River, Sullivan, and Willow River.” Other dam projects receiving funding are: Canby R-6, Lanesboro, Little Stone Lake, Norway Lake and Pelican Rapids.

More than $11.55 million is included for flood hazard mitigation, including projects in Browns Valley, the Cedar River Watershed District and Ortonville; $3.3 million is to improve water quality and restore fish habitat at the Champlin Mill Pond; $1.5 million is for shade tree reforestation in St. Paul; $1 million is to construct the Prospectors ATV Trail System; and $400,000 is to rehabilitate the Soo Line Trail Bridge over the Mississippi River in Morrison County.

The largest funding for the PCA is $25.41 million “to design and implement contaminated sediment management actions identified in the St. Louis River remedial action plan to restore water quality in the St. Louis River Area of Concern.” Funding also includes $11.35 million to, in part, acquire land at closed landfills around the state, including an Anoka County waste disposal engineering site, and $9.25 million to complete a regional integrated solid waste management system in Polk County.

The Reinvest in Minnesota Reserve Program, which, in part, is to “acquire conservation easements from landowners to preserve, restore, create, and enhance wetlands” receives $10 million and $5 million is for the Local Government Roads Wetland Replacement Program “to acquire land or permanent easements and to restore, create, enhance, and preserve wetlands to replace those wetlands drained or filled as a result of the repair, reconstruction, replacement, or rehabilitation of existing public roads.” (Art. 1, Secs. 6-8)

Transportation

Almost $254.92 million is appropriated for transportation projects through MnDOT and $23.75 million through the Metropolitan Council.

The largest amount, $115.93 million, is for local road improvement funds. This includes $25 million for public improvements related to the Interstate 35W and Lake Street access project in Minneapolis, $20.5 million for reconstruction of the Interstate 694/Rice Street interchange and $10.5 million to construct an interchange at Highway 212 and County Road 44 in Chaska. Other undertakings are in Appleton, Baxter, Blaine, Columbus, Inver Grove Heights, McLeod County, Paxton Township and three Highway 12 projects in Wayzata.

The law also includes:

• $71.24 million for rail grade separation crossings in Coon Rapids, Moorhead and Red Wing on crude oil rail corridors;

• $49.21 million for local bridge replacement, including almost $31.88 million to rehabilitate the 10th Avenue bridge over the Mississippi River in Minneapolis and $800,000 to replace the Malone Island Bridge in Isle;

• up to $12.1 million for the Metro Orange Bus Rapid Transit Line between Burnsville and downtown Minneapolis;

• $8.75 million for improvements at the Mall of America transit station;

• $5 million for port development assistance;

• $3 million for construction of a new terminal at the Falls International Airport;

• $1.4 million for rail-grade crossing updates in Eden Prairie;

• $1 million for the Safe Routes to School program; and

• $750,000 for a pedestrian bridge over the Mississippi River in Grand Rapids. (Art. 1, Secs. 15-16)

A grant program for replacement or rehabilitation of major local bridges in which the grant award is at least $7 million is established. Money not needed in any year for major bridge project grants may be used for lower-cost projects. A grant program for projects costing less than $7 million is also created. The law permits a grant for a project that costs more if all other bridge projects on the commissioner’s priority list with a total project costs under $7 million have been fully funded. (Art. 2, Secs. 11-12)

A hazardous materials rail safety grant program is established to reduce the risks associated with the transportation of oil, ethanol and other hazardous material. (Art. 2, Sec. 13)

Housing

The law allocates $10 million to preserve public housing owned and operated by public housing authorities for low-income persons. It also allows the Minnesota Housing Finance Agency to issue up to $15 million more in housing infrastructure bonds originally authorized in 2014 (and $5 million from 2015) that can be paid for within the existing annual general fund appropriation for debt service. The agency is also permitted to issue up to $35 million more in housing infrastructure bonds. (Art. 1, Sec. 22; Art. 2, Secs. 19-22)

Other provisions include:

• $55 million in water infrastructure ($40 million for wastewater and $15 million for drinking water);

• $20 million for Corrections Department asset preservation;

• $19 million for a new intake unit and loading dock with a secure connection to a central warehouse at the St. Cloud prison;

• $15 million for the first phase of renovation of the seal and sea lion habitat at Como Zoo;

• $13 million to replace water-damaged elements of the Science Museum of Minnesota exterior and interior damage due to design and construction defects;

• $12 million to renovate and reconstruct the Miner’s Memorial Building in Virginia;

• $12 million in Greater Minnesota Business Development public infrastructure grants;

• $10.78 million for repair of the Centennial Parking Ramp in the Capitol Complex, including removal of top deck green space for more stalls;

• $8 million to renovate a middle school site and create the Arrowhead Regional Health and Wellness Center in Hermantown;

• $7.85 million for a truss bridge project at the Minneapolis Veteran’s Home;

• $6 million to construct a Minnesota Museum of American Art in St. Paul;

• $5.94 million for public infrastructure in St. James;

• $5.3 million to decommission wastewater stabilization ponds in East Grand Forks and connect the city’s wastewater system to the wastewater treatment system in Grand Forks, N.D.;

• $5 million for metropolitan area regional parks;

• $5 million to build a conference and event center at the Norway House in Minneapolis;

• $4.4 million for the River Town Renaissance project in Red Wing;

• $4 million to construct electrical generation improvements in Litchfield to expand the current standby capacity;

• $4 million for asset preservation at the Minnesota Zoo;

• $3.52 million to construct a joint emergency railroad and pipeline emergency response training facility at Camp Ripley;

• $3 million to construct a municipal complex, including a law enforcement and emergency operations center in Chisago County;

• $2.5 million for Department of Military Affairs asset preservation;

• $1.95 million in General Fund money for an equipment grant to Pioneer Public Television as part of the station’s new facility construction in Granite Falls;

• $375,000 to construct a new grandstand at Tink Larson Field in Waseca to replace one destroyed by fire in 2016;

• $350,000 to repair the Peace Officers and Roy Wilkins memorials at the Capitol Complex; and

• $100,000 for renovation of the community center and fire hall in LaSalle. (Art. 1, Secs. 10-11, 13-14, 16, 18-21).

Funding is altered for the Lewis and Clark water project in southwest Minnesota that is designed to provide quality, reliable drinking water to the area. The law permits the use of the approximately $7.2 million remaining from the $19 million authorization for phase 2 to be used for phase 3. An additional $3.5 million is authorized to complete phase 3. (Art. 2, Sec. 2)

The law cancels a little more than $14 million in previous bond proceeds fund appropriations for projects that are completed or amounts otherwise identified by agencies as unneeded. It also makes a number of mostly technical and clarifying changes to previous year allocations, such as changing the use of an allocation if money is remaining after the designated project is complete. (Art. 1, Sec. 26; Art. 2, Secs. 1, 23-32)

Additionally, the law prohibits a commissioner or agency head from approving “a contract or grant state funds for a capital improvement project to construct or renovate a public gathering space in the building” unless audio-induction loops are included if the public gathering space will have a permanent audio-amplification system. (Art. 2, Sec. 3)

The House and Senate chambers in the State Capitol are exempt from any State Building Code and State Fire Code requirements pertaining to exit sign placement at exit access doors and occupancy limit signs. (Art. 2, Sec. 14)

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