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ST. PAUL, Minn. – With road construction season in full swing, Minnesota Department of Transportation Commissioner Nancy Daubenberger wrote an op-ed for the League of Minnesota Cities detailing a new cost sharing policy that will save cities and towns an average of $20 million a year in construction spending.
Nancy Daubenberger: Creating a Fairer Transportation Funding Formula
Summer is road construction season in Minnesota, when public works agencies at all levels of government make long-term improvements to the infrastructure residents use every day.
At the Minnesota Department of Transportation, we have worked over the years to reduce some of the hassles that come with road construction. Yes, motorists still face temporary inconveniences as they navigate work zones, but in partnership with local leaders and the League of Minnesota Cities, we have made progress on one of construction season’s pain points: who pays for it.
Earlier this year, we finalized an update to the Cost Participation Policy, which outlines how
MnDOT and local governments split the cost of construction projects on shared roadway
infrastructure.
Our updated policy sets a fairer funding formula that saves cities and towns money, and frees up resources for other local demands.
To understand the impact of this change, some context is helpful.
For many years, MnDOT has worked with local leaders to navigate the funding challenges inherent in transportation improvement projects. Some projects are clearly local responsibilities: sidewalks on city roads or parking lots at city halls. Others are clearly MnDOT’s responsibility: pavement replacement on state highways or installing signs, guardrails, and lighting on freeways.
But for projects that fall between these two ends of the spectrum — installing a traffic light on a state highway, for instance — there is a gray area. How do we share responsibility so everyone has a voice and the costs are split fairly? And how do we handle ongoing maintenance of our infrastructure to ensure safety, accessibility, and upkeep? Since its inception in 1985, our Cost Participation Policy has aimed to answer these questions, though often not always perfectly.
In 2024, we began a new process to update the policy. Our goal was to ensure it aligns with our mission — to connect and serve all people through a safe, equitable, and sustainable transportation system. That includes a fair distribution of responsibilities. While no public works agency has all the funding it needs to maintain the infrastructure it’s responsible for, we recognize that one size does not fit all when it comes to local resources and needs.
Throughout the rewrite, we consulted extensively with the City Engineers Association of Minnesota and the League of Minnesota Cities and its members to help shape the updated policy. Many local governments joined a MnDOT steering committee and a local agency workgroup to guide this work. Your feedback was instrumental in shaping a policy that we think works better for state and local governments alike.
Under the new policy, MnDOT is helping to ease the financial strain major construction projects can place on communities, especially small and medium sized towns and cities with lower tax bases. Cities and towns will continue their commitment to long-term maintenance and upkeep of shared infrastructure.
In the end, we landed on a new formula that roughly cuts in half local contributions to shared projects proposed by MnDOT. We estimate this will collectively save cities and towns an average of $20 million a year.
This does not solve all funding challenges local governments face, but we have heard from many of you that it helps. We hope this policy strengthens MnDOT’s partnership with local governments and provides more flexibility to meet your needs while serving the people and businesses of Minnesota.
This construction season, MnDOT has a long list of improvement projects across the state. We are partnering with cities and towns on projects from Proctor to Windom, and we’re putting the new policy to work right away.
Road construction is well underway, and our teams are working together to improve safety and mobility, create a smoother ride, reduce congestion, improve accessibility, and support drivers who rely on our roadways. MnDOT is proud to partner with cities and towns to help Minnesotans get to where they need to go.
Nancy Daubenberger is commissioner of the Minnesota Department of Transportation.
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www.mndot.gov
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