Lack of transportation bill will prove costly to Minnesota with loss of federal dollars, delayed projects
The Legislature failed to approve a transportation bill this session, and the Minnesota Department of Transportation is still assessing what the impact will be in terms of accessing federal dollars and inflationary losses for delaying projects.
WILLMAR — The Minnesota Department of Transportation is still assessing how much federal funding the state might lose as a result of the Legislature’s failure to approve a transportation bill.
District Engineer Jon Huseby told the Area Transportation Partnership at its meeting on June 24 that it’s difficult at this time to quantify the amount of federal transportation money that the state will not receive, as well as the losses due to inflation if projects are delayed.
“I even hesitate to say what some of those numbers are,” Huseby said. “From what we’re hearing, it could be upwards of $100 million for fiscal year ‘22.”
State Rep. Paul Torkelson, R- Hanska, who participated in the meeting virtually, said he could not dispute the bad news delivered by the district engineer. “I assure you no one wants to miss out on any federal funds,” he said.
Torkelson is the Republican lead on the House Transportation Finance and Policy Committee.
The state Legislature could approve a transportation bill if a special session is held. Huseby said it’s “anybody’s guess” whether that would occur.
“I wouldn’t hold my breath on a special session,” Torkelson told the meeting attendees.
Huseby said the lack of a transportation bill impacts MnDOT's ability to access federal dollars in two ways. MnDOT is only able to spend a specified amount of money in a fiscal year. Without a bill, the amount was not raised to take the new funds into account.
Also, many of the federal dollars would only be available if there are state matching funds. Without a bill, no matching funds are allocated.
Huseby noted that, prior to the end of the legislative session, there had been apparent support in both the House and Senate to approve a transportation bill that would take advantage of the new federal dollars. Many of the federal funds being sought are “leftover” dollars that other states did not take advantage of, he explained.
MnDOT is exploring what options it has to delay projects in which it had hoped to use the federal funds. That comes at a cost too: Huseby noted that inflation is a big deal right now.
Torkelson said he is unsure how things will shake out, but he offered some hope. He pointed out that the federal funding that MnDOT wants to tap is part of a five-year program, and funds should still be available in the years ahead.
He said he is also hopeful that there will be enough energy and support when a new Legislature convenes next year to get something done early.
Torkelson had hoped to see changes made in the process for awarding Corridors of Commerce funding in a new transportation bill. He has expressed concerns about how “regional balance” is determined when splitting the corridor funds between the metropolitan and rural areas of the state.
The Corridors of Commerce program, created by the 2013 Legislature, has a selection process that includes regional balance as one of eight criteria, but several state legislators in recent years have charged that the funding has benefited metro area projects more — specifically four projects in 2017.
MnDOT proposed changes that were outlined late last year to a meeting of the Area Transportation Partnership for the Willmar region.
Absent a new bill during this session, no changes were adopted. MnDOT will be accepting transportation proposals beginning Aug. 1 for $200 million in corridor funds.
Corridors of Commerce funds have benefited the District 8 counties served by the MnDOT office in Willmar. The funds have helped fund a portion of the Highway 23 “gap” project for a four-lane highway from Willmar to Interstate 94 and made it possible to add passing lanes on portions of Highway 23 south of Willmar.