1. Presentation to Governor’s Transportation Finance Advisory Committee June 22, 2012

2. Presentation Overview What is CTIB’s regional vision? Why invest in transitways? What role does CTIB play? What does CTIB invest in? Where do we go from here? 2

4. 44th largest regional economy Rank*Countries and Metro AreasGP 1United States$8,510.975 10Spain $552.568 20Chicago, IL $287.410 22Switzerland $263.656 40Greece $119.536 44Minneapolis-St. Paul $103.605 49Venezuela $95.023 59Egypt $81.904 61Ireland $77.217 93Hungary $47.184 98Ukraine $43.467 *World Rankings Based on Gross National and Metropolitan Product, 1998 (US$ Billions, Current)

5. Our Vision A network of connected transitways fully integrated with other transportation elements  Move users efficiently & safely  Mitigate congestion  Enhance development & competitiveness  Improve sustainability & livability 5

6. A Shared Regional Vision Metropolitan Council Public Business Community Federal Transit Administration Corridors of Opportunity Policy Board 6

7. 77 Regional Vision

8. WHY INVEST IN TRANSITWAYS? 8

9. Why invest in transitways? We are growing We need to compete We want to protect and enhance our quality of life 9

10. Business wants more transit Regions with robust transit systems work better. Those regions are choice destinations for employers and employees, because business has wider access to labor, and workers enjoy a higher quality of life. Our competitor regions understand this, and are increasing their investments in transit. For us to remain competitive and attain our regional economic goals, our region must continue to strengthen our transit system. - the Chambers of Commerce 10

11. Public wants more transit Statewide 76% agree: “Minnesota would benefit from having an expanded and improved public transportation system, such as rail and buses.” 69% agree: “I would like to use public transportation such as rail or buses more often, but it is not convenient or available from my home or work.” 7-county metro 67% say public transportation has a positive impact on our ability to attract businesses to the Twin Cities region. 73% say public transportation has a positive impact on jobs. 71% say public transportation has a positive impact on the quality of life in Minnesota. 74% say public transportation has a positive impact on the amount of traffic congestion. 11 Survey conducted in January 2012 by FM3 and POS for Minneapolis and Saint Paul Chambers.

12. Transit lets us prosper: A day in September 2011 Twins + Vikings + “Wicked” 100,000 people State Fair 155,000 people Rush hour for two downtowns 200,000 workers Central Corridor “eds & meds”67,000 workers 522,000 people Transit is the only way to serve these numbers! Transit makes possible a world-class region (a region that can do more than one thing at a time) 12

13. Transit lets us prosper. Lack of transit capacity limits job growth in downtowns and suburbs. Major HQs in downtowns and suburbs say: “We need transit to add substantial jobs.” Super Valu parking lot is full. Not cost-effective to build a ramp. 13 SUPERVALU

14. We need transit to compete for workers. 14

15. Transit allows us to attract the future Transit makes us a region that draws the future’s workers and jobs. “Companies are recruiting and targeting the next generation of talented workers, the Generation Y and millennials who increasingly prefer urban lifestyles with mass transit. ” –Urban Land Institute 15 Source: Jeffrey Spivak, “Urban Office Momentum”, Urban Land, September 14, 2011

16. 16 Primary Contractors: Carl Bolander & Sons Co., St. Paul Graham Construction Services Walsh Construction, Chicago Ames Construction Inc., Burnsville C.S. McCrossan, Maple Grove Siemens Mobility, Sacramento, CA Aldridge Electric, Libertyville, IL ColliSys, New Hope PCL Construction Services Inc., Burnsville Sub-contractors include: AirFresh Industries, Stillwater Goliath Hydro-Vac Inc., Lakeville Povolny Specialties, Inc., Inver Grove Heights All Agape Construction Co. Gunnar Electric Inc., Eden Prairie Precision Testing, Burnsville & Virginia, MN All Star Rolloff Inc., Inver Grove Heights Hansen Thorpe Pellinen Olson Inc. Princess Trucking Inc., Elk River Am-Tec Designs Inc., Scandia High Five Erectors Inc., Shakopee Professional Engineering Services C.P. Office Products, Circle Pines MC Supply Terron Trucking, Bloomington Crystal Welding, Maple Grove Meyer Contracting Inc., Maple Grove Transignal, Elk River Highway Solutions Inc., Stillwater Public Solutions Inc. B & B Diversified Materials Icon Services Corp., St. Paul Rani Engineering Inc., Minneapolis B & L Supply Inc., St. Paul J & L Steel Erectors, Hudson, WI Ray Trucking Bald Eagle Erectors Inc., Eagan J.D. Donovan Inc., Rockville Rock On Trucks Inc., Waite Park Big G Tech Support, Brooklyn Center Joans’ Minority Owned Supplier, Mpls. Safety Signs Big Jay’s Cleaning Services Kang Contracting Corp., St. Paul Sanders Steel Erectors, Hastings Borgert Products Inc., St. Joseph Lanier Steel Products Inc. CI Utilities, Blaine Shaw Trucking Inc., Ham Lake Carlo Lachmansingh Sales Inc., Minneapolis Lema Trucking Simplex Construction Supplies, Blaine MBE Trucking Inc., Delano Standard Contracting Inc. COHO Enterprises, Brooklyn Park MC Electric Stonebrook Fence Inc., Prior Lake Astro Engineering and Manufacturing Inc., Plymouth Dispatch Trucking MFRA Inc., Plymouth Two Buffalo Construction Supplies Inc., Minneapolis E & J Rebar Inc., Oak Grove Midwest Lighting Products, Maple Grove Utility Sales & Supply Inc., Loretto Eagle Land Surveying Inc., Rockford MTECH Electric Inc. Wissota Supply Co., Hastings E-Con Placer Nexpro Personnel Services, Inc., St. Louis Park Woody’s Rebar Co. Inc., St. Paul Eden Resources, Eden Prairie Northstar Imaging Services, Inc., Eagan Yaw Construction Group Inc., Minneapolis Elliott Contracting Corp., Minneapolis O’Malley Construction Inc., Le Center Z Companies Inc. (dba ZAN) Environmental Enhancements EVS Inc., Eden Prairie Source: Minneapolis/St. Paul Business Journal, February 25, 2011 from data provided by the Metropolitan Council. Cities were not available for all contractors. Rail Means Business Central Corridor Contracts:

17. Development on Hiawatha Units Forecast : 1999 Market Study, 2000 – 2020: 7,120 Open In Construction ProposedTotal 7,5352527,51315,300 2000 - April 2010

18. Highly Efficient System 2011 Legislative Auditor’s Report: Transit Governance in Twin Cities MN has 2 nd lowest subsidy per passenger MN also has higher than average fare-box recovery rates 18

19. Other regions know this, are ahead of us & are building faster. 19 Source: Bill Rankin, c. 2006 Maps to same scale.

20. Our Competitors Are Far Ahead Miles 20 Source: Adapted from Fresh Energy, 2012

21. Other regions know transit matters, and ARE INVESTING MORE: 21 Adapted from TLC, 2011

22. Uncertainty Delays Private Development Uncertainty about funds –delays transit construction, –delays jobs, –delays development. Businesses wait to see where transitways will go before building and investing. –Southwest LRT-- Northstar Ramsey Station –Central Corridor LRT-- Hiawatha LRT 22

23. Summary of Why CTIB Invests In Transitways A thriving region -- the product we are making. Transit -- an essential component. Leave it out or put in too little -- get a different, less competitive, product. 23

24. WHAT ROLE DOES CTIB PLAY? Overview of Structure and Funding Sources 24

25. CTIB: Major Investor 25

26. Counties Invest Heavily Capital Cost Share Pre-FFGA Counties provide 80% of Non-Federal share (pre- FFGA) Counties assume significant risk –Fund PE & FD before the FFGA commitment 26

27. Dedicated Funding Source for Transit Funding Source: Total Revenue: ¼ cent sales tax $20 motor vehicle excise tax $97 million per year (2011) 27

28. 28 A County-Led Organization Authorization: 2008 Omnibus Transportation Finance Bill (Minn. Stat. Section 297A.992) -- Counties voted for sales tax Five-County Joint Powers Board: Anoka, Dakota, Hennepin, Ramsey and Washington Met Council has representative on Board Scott and Carver Counties: non-voting members

29. Basis for Weighted Voting System Sales TaxPopulation 29

30. 30 Voting Distribution P= Population S= Sales Tax COUNTY % Population % Sales Tax VOTES: 50% P + 50% S Anoka12.6%8.4%10 Dakota15.0%12.8%13 Hennepin44.1%55.0%47 Ramsey19.7%18.2%18 Washington8.7%5.5%7 Met CouncilN/A 5

31. Legislative / Stakeholder Expectations Property Tax Relief –Operating Costs (398A.10 subd. 2) & Capital investment reduction Maximize Use of Federal Funds (297A.992 subd.5) Reduce the Reliance on State Bonding –33% state project share down to 10% 31

32. Legislative / Stakeholder Expectations Expansion of the System –“Supplement not Supplant” (297A.992 subd. 12) Construction, not Studies* Minimal administrative expenses 32 *Exception: Washington County Guaranteed Grants

33. Lean Administrative Structure ¾ of 1% (297A.992 subd. 4) Executive Committee BoardSenior StaffLega l FinanceCommunicationsGEARS No employees No buildings Use county staff Work closely with Met Council staff 33

34. Leveraging ~$1.5B in Federal Funds 34

35. Grant Funding: Sales Tax Receipts and Historic Comparison 35

36. 36 Grant Funding: Bonds $110 million in bonds issued in Dec. 2010 Issued by Hennepin County: $3 million savings Capital Grants for Central Corridor: 2011-2012 May not be used for operating grants 36

37. Annual Grant Process Overview 37

38. WHAT DOES CTIB INVEST IN? Projects and Corridors Supported by CTIB 38

39. Focused on Transitway Expansion CTIB invests in: Engineering, construction and operations BRT, Commuter Rail, and LRT CTIB does not fund: Studies* Passenger rail, regular route buses, arterial BRT 39 *Exception: Washington County Guaranteed Grants

40. Project Development Process 40 Operations and Maintenance Construction Final Design - final plans, specifications and bid documents Preliminary Engineering (PE, 30% plans) and final NEPA environmental review System and early corridor planning Alternatives Analysis (AA), Conceptual Engineering (10% plans), and initial NEPA environmental review VariesOn-going3 - 4 years1 year2 years2 - ? Years Progression of example project development process Locally Preferred Alternative Eligible for CTIB GrantsLocally Funded

41. CTIB Grants Awarded to Date Grants Awarded^CapitalOperatingWashington 2008 / 2009:$30.23 m$42.14 m*$0.95 m 2009 / 2010:$78.02 m$13.29 m$2.55 m 2010 / 2011:$132.77 m$16.87 m$2.66 m 2011 / 2012:$122.24 m$22.59 m~$2.70 m TOTAL$363.26 m$94.89 m$8.86 m ^Grants awarded in November of each year are payable in the next Calendar Year. *Includes statutorily required one-time grant to Metropolitan Council of $30.78 Million. ~2011 Special Session Law mandated an increase in the CTIB operating subsidy to 75% for the 2011-2013 biennium. 41

42. 42 $467 million invested by CTIB since 2008 42

43. Status of Corridors Operational Hiawatha Northstar 135W S BRT Cedar BRT Construction Cedar BRT Central LRT Final Design 35W S BRT Preliminary Engineering Southwest LRT Feasibility 35W N BRT North Central Robert St. Riverview AA or EIS Bottineau Gateway Red Rock Rush Line VariesOn-going3 - 4 years1 year2 years2 - ? Years Progression of example project development process Locally Preferred Alternative Eligible for CTIB GrantsLocally Funded 43

44. WHERE DO WE GO FROM HERE? 44

45. Current Regional Initiatives Program of ProjectsCorridors of Opportunity HUD Sustainable Communities Grant Living Cities Integration Initiative Corridors of Opportunity 45

46. Program of Projects (PoP) Study Purpose of Study Determine the feasibility of accelerating the development of multiple transitway corridors (a Program of Projects) to serve the region. 46

47. Main Questions for Program of Projects 1.Is it possible: –To complete our shared vision given current funding practices and policy? –To build our vision more quickly given current funding practices? Sneak peak at the answers: No 2.How have other cities accelerated their building? 3.What might work in our region? What are our options? 47

48. PoP Work Tasks Develop 3 Scenarios Analyze alternative PoPs using current funding practice Explore what Peer Cities have done Apply lessons learned and develop options for Twin Cities metro area Propose an approach to fund and accelerate a PoP 48 We are here

49. Six Core Projects in All Scenarios Hiawatha LRT Northstar Commuter Rail Cedar Avenue BRT (all phases) Central Corridor LRT Southwest LRT I-35W South BRT (all phases) Core Projects have approved alignments and modes (LPAs) and are in Preliminary Engineering, construction or operation. 49

50. Three PoP Scenarios w/ Nine Expansion Projects ModeBRTBRT plus 1 RailBRT plus 3 Rail LRT BRT – Exclusive None 2 projects 1 line 1 project 2 lines None BRT – Highway Commuter Rail 4 projects None 4 projects None 3 projects 1 line Arterial BRT3 lines Number of additional Expansion Projects 999 50

51. Peer Cities Summary 51

52.  “Transitway corridors will guide our region’s growth, vitality and competitiveness. Development along transitways will create distinctive places and strengthen local assets while increasing ridership and expanding access to jobs, affordable housing, and essential services for residents of all incomes and backgrounds.” 52

53. 53

54. Peer Cities Findings 1.All cities defined and developed a specific program of projects. 2.All cities use sales taxes as the primary local funding source. 3.All cities use sales taxes for transit and transitway capital and operations. 4.All cities use FTA New Starts funding 5.Several of the cities are implementing projects using all non-federal funds. 6.Most of the cities had to raise their sales tax rate to fund a Program of Projects. 7.Only two of the seven cities receive state funding.

55. Further Information Commissioner Peter McLaughlin, Chair Counties Transit Improvement Board & Hennepin County Regional Rail Authority peter.mclaughlin@co.hennepin.mn.us (612) 348-7884 www.mnrides.org 55