MN SF4115

State funding for local capital improvement projects may not exceed 50 percent of total project cost, except for disaster-related projects or those in low tax capacity areas, or when a compelling reason exists.

Political subdivisions requesting more than 50 percent state funding must describe how their project meets criteria for a compelling reason, as established in statute.

Compelling reason determinations must consider two categories: the value of the project (regional significance, infrastructure effectiveness, job creation, economic development potential, and ability to maintain operations) and the financial need for increased state funding (local financial hardship, existing debt capacity, local sales tax usage, and prior funding efforts).

Deadline for budget requests remains July 15 of odd-numbered years, though the governor and legislature may recommend or fund projects missing this deadline if a compelling reason exists.

State funds from any source (transfers, grants, aid, apportionments, allotments) that are committed to a project count toward the state share requirement.