County tapped again as SWLRT budget swells

As the Southwest Light Rail Transit budget continues to grow, more of the responsibility for funding the state’s largest ever transportation project will be borne by Hennepin County taxpayers.

Met Council is expected May 30 to officially increase the project’s budget 7.8 percent, to just more than $2 billion from about $1.86 billion. The following day, the Hennepin County Board and Hennepin County Regional Railroad Authority are scheduled to convene in special meetings to consider a $204 million increase in their combined contributions to the project. The new county funds exceed the increase in overall project costs because some project components, including an in-kind land transfer from the county to Met Council, are accounted for differently in the revised budget.

It’s not just Hennepin County taxpayers stepping up to the plate this time. While property tax revenues fund the railroad authority’s budget, the county pays for transit project with revenues generated by a half-cent sales tax — a tax paid by many non-county residents, Commissioner Peter McLaughlin pointed out.

“We’ve got adequate resources,” he said.

In exchange for its support of the Met Council plan, Hennepin County is proposing to take tighter control of the project’s contingency fund. It would add an executive control board to review change orders exceeding $350,000, and it would place half of the contingency fund into a reserve controlled by the board. Transferring funds from the reserve account would require approval from a simple majority of board members.

The county would also seek a more active role on the project for its staff.

Together, the county and railroad authority will soon control a slice of the budget pie worth at least $780.5 million — a nearly 40 percent stake in the project, second only to the contribution expected from the Federal Transit Agency. That total doesn’t include $11 million from various county funds earmarked for project-related trail improvements or the tax revenue Hennepin County funneled to the Counties Transit Improvement Board, another local partner on the project.

And as the county’s contribution is growing, the federal share of the project budget is shrinking.

For years, Met Council maintained FTA funds would cover half the cost of the project. But that contribution was capped at $928.8 million in December 2016, when Met Council applied with the agency to advance the SWLRT project into the engineering phase.

The state is in for just $30.3 million, and CTIB voted to dissolve last year, leaving the Hennepin County as the only obvious source of new dollars for the project to tap.

And while they have recently made painful cuts — eliminating a planned light rail maintenance facility in Hopkins and replacing it with a very basic vehicle storage area — project leaders acknowledge the budget could continue to grow.

Delays figure significantly into rising costs. The project faces two lawsuits and awaits a federal board’s ruling on a critical property transfer, all of which threaten to slow progress. The new budget counts on FTA approval of a smaller contingency fund — not yet granted — and the fluctuating price of copper figures to be a significant factor in the size of a contract for light rail control and communications systems that has yet to be awarded.

If construction begins this fall, the 14.5-mile extension of the Metro Green Line to Eden Prairie would begin revenue operations in 2023.

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