The following article by Janet Moore was published in the August 1, 2015 edition of the Star Tribune.
Financing Tool for Southwest Light-rail Project Questioned by GOP Transportation Leader
The obscure financial tool would provide bridge financing to aid in rail line’s cash-flow problems.
Photo: Glen Stubbe
House Transportation Committee chairman Rep. Tim Kelly, R-Red Wing, wrote to the head of the Met Council in June asking whether the regional planning agency has the legal authority to issue certificates of participation for a transit project.
A little-known financial tool may be considered to keep money going to the beleaguered $1.74 billion Southwest light-rail project — and it’s provoking another round of controversy.
The Metropolitan Council is considering the use of “certificates of participation,” a form of government financing, to keep the project afloat while legislators debate the $138 million needed in state funding for the transit project. Legislative support is uncertain, and the lack of state support could imperil critical federal funding for the 14.5-mile line linking Minneapolis to Eden Prairie.
The Met Council said the tool would only be deployed as a stopgap to bridge temporary cash-flow issues that may arise, not as a way to pay the state’s entire share. And, they say, certificates would only be tapped as part of a broader financial plan for the project approved by lawmakers.
Rep. Tim Kelly questions the idea. The Red Wing Republican, who chairs the House transportation committee, wrote to the head of the Met Council in June asking whether the regional planning agency has the legal authority to issue certificates of participation for a transit project. The Met Council maintains it does.
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