1.1 A bill for an act
1.2 relating to local government; authorizing a municipality to establish a street
1.3 improvement district; proposing coding for new law in Minnesota Statutes, chapter
1.4 435.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. [435.39] MUNICIPAL STREET IMPROVEMENT DISTRICTS.
1.7 Subdivision 1.Definitions.(a) For the purposes of this section, the following terms have
1.8the meanings given.
1.9 (b) "Governing body" means the city council of a municipality.
1.10 (c) "Improvements" means construction, reconstruction, and facility upgrades involving:
1.11right-of-way acquisition; paving; curbs and gutters; bridges and culverts and their repair;
1.12milling; overlaying; drainage and storm sewers; excavation; base work; subgrade corrections;
1.13street lighting; traffic signals; signage; sidewalks; pavement markings; boulevard and
1.14easement restoration; impact mitigation; connection and reconnection of utilities; turn lanes;
1.15medians; street and alley returns; retaining walls; fences; lane additions; and fixed transit
1.16infrastructure, trails, or pathways. Fixed transit infrastructure does not include commuter
1.17rail rolling stock, light rail vehicles, or transit way buses; capital costs for park-and-ride
1.18facilities; feasibility studies, planning, alternative analyses, environmental studies,
1.19engineering, or construction of transitways; or operating assistance for transitways.
1.20 (d) "Maintenance" means striping, seal coating, crack sealing, pavement repair, sidewalk
1.21maintenance, signal maintenance, street light maintenance, and signage.
1Section 1.
25-04110 as introduced03/03/25 REVISOR MS/BM
SENATE
STATE OF MINNESOTA
S.F. No. 2366NINETY-FOURTH SESSION
(SENATE AUTHORS: JOHNSON STEWART)
OFFICIAL STATUSD-PGDATE
Introduction and first reading03/10/2025
Referred to State and Local Government 2.1 (e) "Municipal street" means a street, alley, or public way in which the municipality is
2.2the road authority.
2.3 (f) "Municipality" means a home rule charter or statutory city.
2.4 (g) "Street improvement district" means a geographic area designated by a municipality
2.5and located within the municipality within which a municipality may undertake and finance
2.6street improvements and maintenance according to this section.
2.7 (h) "Unimproved parcel" means a parcel of land that is not improved by construction of
2.8an authorized structure or contains a structure that has not previously been occupied, and
2.9abuts an:
2.10 (1) unimproved municipal street and that is not served by municipal sewer or water
2.11utilities; or
2.12 (2) improved municipal street and served by municipal sewer or water utilities.
2.13 Subd. 2.Authorization.To pay for street improvements and maintenance, a municipality
2.14may, by ordinance, impose a street improvement fee. The fee amount must be just and
2.15equitable. The municipality must adopt the ordinance after providing public notice and
2.16holding a public hearing pursuant to subdivision 5.
2.17 Subd. 3.Street improvement fee.Except as provided in subdivision 10, a municipality
2.18must apportion street improvement fees to all developed parcels located in the district. A
2.19street improvement district must not include any property already located in another street
2.20improvement district.
2.21 Subd. 4.Apportionment.All or part of the costs of municipal street improvements and
2.22maintenance must be apportioned to all developed parcels or developed tracts of land located
2.23in the established street improvement district on the basis of each developed parcel's or
2.24tract's relative share of the vehicular trips to and from all developed parcels and tracts in
2.25the street improvement district during the preceding calendar quarter, as estimated from a
2.26representative sample of actual trip data compiled from a source which has been certified
2.27as suitable for this purpose by the commissioner of transportation.
2.28 Subd. 5.Adoption of plan; notice and hearing.(a) Before establishing a municipal
2.29street improvement district or authorizing a street improvement fee, a municipality must
2.30propose and adopt a street improvement plan that identifies the location of the municipal
2.31street improvement district and identifies and estimates the costs of the proposed
2.32improvements during the proposed period of collection of municipal street improvement
2.33fees, which must be for a period of at least five years and no more than 20 years.
2Section 1.
25-04110 as introduced03/03/25 REVISOR MS/BM 3.1 (b) A municipality must provide notice of a public hearing on the proposed plan by mail
3.2to all affected landowners at least 30 days before the hearing and must post the notice in a
3.3public place for at least 30 days before the hearing. The notice shall include the time and
3.4place of the hearing, a map showing the boundaries of the proposed district, and a statement
3.5that all persons owning property in the proposed district that would be subject to a service
3.6charge will be given the opportunity to be heard at the hearing.
3.7 (c) At the public hearing, the governing body must present the plan and all affected
3.8landowners in attendance must have the opportunity to comment before the governing body
3.9considers adoption of the plan.
3.10 Subd. 6.Use of fees.A municipality must place revenues from street improvement fees
3.11in a separate account and must use the revenues for projects located within the district and
3.12identified in the municipal street improvement plan.
3.13 Subd. 7.Collection; up to 20 years.(a) An ordinance adopted under this section must
3.14provide for billing and payment of the fee on a monthly, quarterly, or other basis as directed
3.15by the governing body. The governing body may collect municipal street improvement fees
3.16within a street improvement district for no more than 20 years.
3.17 (b) As of October 15 of each year, a municipality may certify fees that remain unpaid
3.18for at least 30 days to the county auditor for collection as a special assessment payable in
3.19the following calendar year against the affected property.
3.20 Subd. 8.Not exclusive means of financing improvements.The use of the municipal
3.21street improvement fee by a municipality does not restrict the municipality from imposing
3.22other measures authorized by statute or by home rule charter to pay the costs of local street
3.23improvements or maintenance, except that a municipality must not impose special
3.24assessments for projects funded with street improvement fees.
3.25 Subd. 9.Unimproved parcels; fees.A municipality may not impose a street improvement
3.26fee on any unimproved parcel located within an established street improvement district until
3.27at least three years after the date of substantial completion of the paving of the previous
3.28unimproved municipal street, or the date which a structure is built and first occupied pursuant
3.29to a certificate of occupancy, whichever is later.
3.30 Subd. 10.Institutions of public charity.A municipality may not impose a street
3.31improvement fee on any parcel owned by an institution of purely public charity as defined
3.32in section 272.02, subdivision 7.
3Section 1.
25-04110 as introduced03/03/25 REVISOR MS/BM 4.1 Subd. 11.Appeal to district court.Within 30 days after adoption of a street improvement
4.2fee, any affected landowner may appeal to the district court by serving a notice upon the
4.3mayor or clerk of the municipality. The notice shall be filed with the court administrator of
4.4the district court within ten days after its service. The appeal shall be placed upon the
4.5calendar of the next general term commencing more than five days after the date of serving
4.6the notice and shall be tried as other appeals in such cases. The court shall either affirm the
4.7street improvement fee or set it aside and order a reapportionment as provided under
4.8subdivisions 3 and 4. All objections to the street improvement fee shall be deemed waived
4.9unless presented on appeal. This section provides the exclusive method of appeal from a
4.10street improvement fee issued under this section.
4.11 EFFECTIVE DATE.This section is effective July 1, 2025.
4Section 1.
25-04110 as introduced03/03/25 REVISOR MS/BM