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As a natural extension of University of Minnesota value capture study in 2009, this project demonstrates the application of value-capture strategies to supplement transportation funding for the completion of TH-610 in Maple Grove, Minnesota. Using spatial and regression analysis, we estimate that the completion of TH-610, with two additional exits, would lead to a significant growth in assessed property value, including about $12 million in land value and $5 million in buildings. The growth would result in about $4.3 million in property tax capacity, and about $1 million in annual property tax revenue. With multiple scenarios of hypothetical value-capture designs, we estimate the revenue potential of value capture would range from about $12 million to about $37 million, which could be used to supplement project finance to expedite the completion of TH-610.

This report documents the efforts of engaging the public in decision making regarding local road policy issues in Minnesota, specifically in Beltrami, Dakota, and Jackson counties, and make recommendations based on the findings.

This project examines the link between accumulated transportation capital stocks in Minnesota counties and their annual property tax revenues using longitudinal data in the 1995-2011 period. We separated the effects of two different transportation capital stocks, one associated with load roads and the other with trunk highways. In addition, we considered not only the internal effect of transportation investments within a county, but also the spillover effect due to transportation investments made in neighboring counties. Estimations from panel-data regressions show that local-road capital stocks within a county have a positive effect on its property tax revenues, with an elasticity of 0.093, but much of the benefits may be the outcome of a zero-sum game due to inter-local competition of property tax bases. Trunk-highway capital stocks within a county also show a positive effect, with an elasticity of 0.013. The spillover effect of trunk-highway development is even higher: The average level of trunk-highway capital stocks in neighboring counties has a positive elasticity of 0.030 on a county's property tax revenues. Applying the estimations to the county data in FY2010, we calculated the ROI (return of investment) of additional transportation investments on property tax bases. The average ROI on the growth of EMV (Estimated Market values) within a county is about 1.254 for local roads, and about 0.871 for trunk highways. The regional impact would be reduced for local roads due to the inter-local competition, but significantly amplified for trunk highways due to spillover benefits.

Facing rapidly increasing demand for new or additional transportation capacity, many states are eagerly exploring public-private partnership (PPP) in state highway development, which may allow public agencies to access private project financing and specialized expertise, and thus save public investment, expedite project completion, or improve service quality and diversity. Nevertheless, the path of PPPs is not smooth. The confusion and controversy surrounding recent asset-monetization leasing concession cases in the US have led to widespread public concerns and legislative caution, in particular on the question of whether a PPP project is advancing the public interest. The purpose of this project is to study the public interest associated with PPPs, with the goal to maximize efficiency gains, mitigate potential risks, and address public concerns in launching and deploying PPPs in state highway development. In particular, we focus on three aspects of PPP consideration: (1) Understanding economic rationales of PPPs, (2) Legal and political aspects of PPP decision-making, and (3) Managerial issues in implementing PPP projects.

Planning and environmental studies involving managed lanes still have difficulty determining how to effectively evaluate project alternatives from an equity perspective. To most people, “equity” is ubiquitous with income, but this is a narrow focus that limits the scope of what can be considered equity, and indeed this can be true when it comes to managed lanes. As the Minnesota Department of Transportation analyzes the expansion of E-ZPass corridors, it is imperative it evaluates project alternatives from an equity perspective. The results of this study suggest that E-ZPass lane users are more racially diverse than users in the travelsheds. In two out of the four E-ZPass lane corridors, a higher proportion of E-ZPass lane users have household incomes below $100,000 compared to the travelsheds. Overall, there is a lower percentage of people with disabilities among E-ZPass lane users than those in the travelsheds. These results are driven by the makeup of E-ZPass lane users. In addition, this research project demonstrates the feasibility of incorporating quantitative and qualitative equity measures into the alternatives analysis process. The demonstration shows that the quantitative measures are all feasible with existing tools, provide meaningful information to the alternatives analysis process, and can be put into practice immediately.

Municipalities across Minnesota have turned to Complete Streets in an attempt to develop more usable roads for their residents. This report investigates how Complete Streets are reshaping one Minnesota community. In 2013; Richfield; a suburb of Minneapolis; enacted a particularly innovative Complete Streets policy. Known locally as "Richfield Sweet Streets;" the program has led to the reconstruction of several major roads across the city. Richfield's Sweet Streets program is unique in that it incorporates a modal hierarchy in which users are prioritized differently in road redesign and reconstruction. It relies on extensive community engagement; aiming to improve outcomes for individuals and the community as a whole. This research presents a baseline analysis of how Richfield's Sweet Streets projects are affecting the local community; while identifying a set of methods and measures for future research. The analysis draws on multiple sources of data to better understand the nature and consequences of Richfield's Sweet Streets for user experience and livability; economic vitality; transportation and safety; and individual and community health. The research aims to illustrate Richfield's innovative approach to transforming its transportation infrastructure while providing a roadmap for future analyses of the impacts of Richfield's Sweet Streets.

The understanding of freight movement is critical to economic development and competitiveness and to make decisions regarding the transportation system. Despite the increased interest in freight planning and modeling, freight data are limited in availability and granularity, and the existing sources are incomplete or outdated. This research analyzes various types of public and proprietary freight databases to determine which are most helpful for planning, programming, and designing future infrastructure on the truck, rail, air, and waterway networks within Minnesota and surrounding states. There are some comprehensive multimodal freight databases that provide different levels of data granularity. These are typically complemented with other data sources that are specific to a transportation mode. We also interview stakeholders involved in freight planning in Minnesota to identify data gaps and capture current and future data needs. Important needs include (i) mode specific freight data, especially for waterways and ports and air freight; (ii) equity considerations in freight transportation; and (iii) understanding the relationship between freight transportation and climate change. Additional freight data are much needed overall to inform economic development and funding prioritization, as well as to evaluate and minimize supply chain disruptions.

Complete Streets is a transportation policy and design approach that requires streets to be planned, designed, operated, and maintained to enable safe, convenient, and comfortable travel and access for users of all ages and abilities regardless of their mode of transportation. While there have been multiple studies on Complete Streets in metropolitan areas, little is known about these projects impacts in small cities. In this research, we assess the economic impacts of Complete Streets projects on small-city businesses through case studies and by comparing economic measures from a group of cities with Complete Streets projects to comparable control groups without these streets. Our findings show that few respondents perceive a direct impact for their business, but many feel that the reconstructions have been (would be) beneficial for the city. Mechanisms through which Complete Streets might impact businesses and the local economy include altering of business practices, changing of city practices, or acting as a catalyst for additional investment. In addition, our results suggest that Complete Streets projects may improve the economic activity of small cities to some extent, particularly when considering revenues from property taxes. The research team also develops a consistent set of economic metrics that MnDOT and local transportation agencies can use to evaluate and communicate the effect of context-sensitive main street highways.

Highway construction; maintenance; and improvements are supported by federal; state; and local funding. States use a combination of state funding and federal dollars to invest in highways and to provide aid to local governments. In recent years; federal and state governments have had challenges keeping up with transportation needs. These challenges affect funding for roadways; including the share of funding going to local governments. However; there is limited research on the impact of changes in federal and state funding on local spending; particularly the share of local government spending on state and regional highway infrastructure. This research aims to fill that gap by assessing the contributions of local expenditures to state and regional transportation facilities in Minnesota. Our findings show that while cooperative agreements can be mutually beneficial for both local and state governments; they can also carry the risk of unexpected costs for local governments. Therefore; local governments should be aware of the risks of entering into cooperative agreements; particularly when state funding totals are capped. Effective communication during planning and construction can mitigate some of the risk of cost increases as well as uncertainties around cost coverage by MnDOT. The use of state contingency funds to reimburse local governments for unexpected trunk highway expenses could also provide additional financial security for local governments.

The roadway system is critical to social development, economic growth, and the overall quality of life. In the U.S., the condition of highways and roads is being compromised due to several reasons including age deterioration, rising costs of construction, and a decline in funding. Similarly, in Minnesota, the majority of pavements are aging and in need of significant maintenance or reconstruction, but there is an expected deficit of $17.7 billion for state roads over the next 20 years. At the local level, pavement conditions along state-aid roads and county, city, and township roads are anticipated to deteriorate significantly based on current funding levels. In addition, significant budgetary impacts on maintenance spending are expected due to the COVID-19 pandemic. Given these budget limitations, agencies often postpone planned maintenance to make funding available for other transportation purposes, but the deferred maintenance will negatively affect asset life, leading to higher future maintenance costs and lower roadway safety. This research analyzes spatial patterns of maintenance expenditures across localities in Minnesota, explores how fiscal conditions affect maintenance expenditures, and examines roadway maintenance decision-making across localities.

Numerous studies have been conducted about the impact of transportation investment on economic development. These studies typically use a conventional production function model of economic development augmented by a public capital input; such as highways; rail; or other transportation investments. The findings; in general; confirm a positive elasticity between transportation investment and economic development; but the range of the effects varies widely among studies. In a recent research project; Zhao (2015) quantifies long-term transportation capital stocks in Minnesota counties and finds that these stocks have positive returns on property values. This study extends Zhao (2015)'s methodology to study the link between transportation investment and job creation. We find that long-term transportation investments contribute significantly to employment in Minnesota counties. The results have several policy implications. First; investments on local roads within a county can increase the employment rate in the county. Second; investments on trunk highway surrounding a county can increase the employment rate in the county. Lastly; in the context of Minnesota; it could be more effective to invest in rural areas compared to urban areas; as far as employment growth in concerned.