Dakota County takes steps to leave regional transit board

Dakota County is planning to leave the regional body that funds transit projects across the Twin Cities.

The County Board voted in committee Tuesday to take steps to withdraw from the Counties Transit Improvement Board (CTIB), which pools tax money for projects such as light rail and bus rapid transit (BRT).

County leaders have raised concerns about whether membership is worth it. Though CTIB dollars have funded local projects including the Red Line BRT, a lot of the tax money that Dakota County contributes goes toward projects in other counties.

"I think we could do so much more if we kept it ourselves," Commissioner Liz Workman said.

Created in 2008, CTIB consists of Anoka, Dakota, Hennepin, Ramsey and Washington counties. The counties collect a quarter-cent sales tax and $20 in sales tax on every new car sold, then CTIB doles it back out to help build and maintain regional transit projects.

Figures prepared by county staff show that between 2008 and 2016, Dakota County contributed 13 percent of CTIB's total transit tax, but got about 7 percent of its capital and operating grants.

Estimates based on CTIB's 2015 list of projects show that by 2024, Dakota County would likely contribute 12 percent of the total funds but get back just 3 percent — a smaller allocation than any other participating county.

Dakota County has been part of CTIB since its inception. The decision to join came in part from a desire to use transit to move people across congested Minnesota River crossings, said Steve Mielke, director of the county's physical development division. Now, though, there are pressing needs for projects within the county that CTIB may not be able to help fund.

"On a fiscal basis, [commissioners] want to make sure that they're getting a good return on their investment," Mielke said.

Going into Tuesday's meeting, one option was for the county to stay in CTIB but try to create a better return on investment by negotiating funding for additional projects.

Officials said they expect CTIB may come back with a counteroffer after receiving notice of the county's intention to leave.

For now, the county has to figure out how to build and maintain its own projects. It also has to pay off nearly $16 million in debt it still owes CTIB.

The matter will come before the board again next week. Once it goes through, the county will have to wait about three years before it can start using transportation sales tax revenue to fund its own projects.

After that, there's no precedent for what happens next — including what effect this might have on the remaining counties in CTIB.

"There's a lot [that's] unknown," said Commissioner Mary Liz Holberg. "In order to protect the taxpayers, I think it's the right move."

Emma Nelson • 612-673-4509