This bill, introduced in the Minnesota House of Representatives, proposes an amendment to Minnesota Statutes section 462.358 by adding new subdivisions that authorize municipalities to impose a street impact fee on applicants developing subdivisions.

Key Provisions:

1. Street Impact Fee Authorization (§12)

   • Municipalities may impose a fee, set by ordinance, based on:
     a) The net buildable acreage of the subdivision.
     b) The subdivision’s impact on the municipality’s transportation system.
     c) The municipality’s transportation plan.
     
   • Funds collected must be placed in a special fund and used only for approved transportation-related projects, including road construction, maintenance, and improvements.
     
   • Municipalities can deny subdivision approval if the transportation system is deemed inadequate.
     
   • If a subdivision has already paid a fee and is later resubdivided without increasing the number of lots, no additional fee applies. However, if more lots are added, the fee applies only to the net increase.
     

2. Nexus Requirement for Fees (§13)

   • A street impact fee must have a clear connection (nexus) to the municipal transportation needs it addresses.
     
   • The fee must be proportional to the actual impact of the development.
     
   • If an applicant disputes a fee before final approval, municipalities cannot require waiver of legal challenges as a condition for approval.
     
   • If an appeal is filed, development may proceed if:
     a) The dispute is put in writing.
     b) The disputed fee is placed in escrow before final approval.
     c) The applicant formally appeals the fee within 60 days under section 462.361.
     
   • If no appeal is filed or if the municipality prevails, the escrowed funds are transferred to the municipality.
     

Purpose & Impact:

This bill grants local governments the ability to collect impact fees from developers to fund road and transportation infrastructure improvements necessitated by new developments. It also establishes guidelines ensuring fees are fair, proportional, and challengeable through an appeals process.