Right-Of-Way Acquisition Loan Fund
Funds purchase land slated for future highways, to protect it from development
Land needed for future road right-of-way can be lost to development, because MnDOT is unable to purchase highway right-of-way until a road is programmed for construction. To address this, the 1982 Minnesota legislature established a revolving loan fund program to acquire undeveloped property located within an officially-mapped metropolitan highway right-of-way that is threatened by development. Subsequent modifications to legislation now allow purchase of other types of property.
Process
- Cities submit a preliminary loan request.
- After Met Council determination that the property is eligible, cities have the property appraised and negotiate a price with the seller. The cities are also reimbursed for costs they incur to acquire the property. Any income derived from the property while under city ownership is returned to the RALF account.
- MnDOT reviews and certifies the appraisals.
- The Met Council lends money to cities to purchase the right-of-way from willing sellers.
- When MnDOT needs the land for highway construction, it buys the property from the city at the price paid for the property.
- The city repays the loan to the RALF account
The Met Council decides annually whether to levy for the program, based on expected loan requests from various cities as well as any expected loan repayments. A levy has not been necessary for several years as loan repayments have maintained an adequate balance for future loans.
In 2014, the Met Council concluded an assessment of the program that showed long-term savings occurred because development of the land and its appreciated costs have been preempted. Some eligibility modifications were made at that time. Additional changes were made in 2016. Over the last 20 years loans have been made to acquire right of way parcels for TH 10, TH 52, TH 169, TH 212, TH 610, I-494,I-694, I-35W and I-35.