Item Description:
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HCRRA Funding Commitment for the METRO Blue Line Extension LRT Project (CP 1000941)
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Resolution:
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BE IT RESOLVED, that the Hennepin County Regional Railroad Authority (HCRRA) hereby commits to increase its funding share for the METRO Blue Line Extension light rail transit capital project (CP 1000941), up to ten percent of total capital project costs, in an amount not to exceed $358,000,000; and
BE IT FURTHER RESOLVED, that HCRRA’s funding commitments to the METRO Blue Line Extension light rail transit project will follow all terms and conditions addressed in the Capital Grant Agreement and future amendments between Hennepin County, HCRRA, and Metropolitan Council (PR00005488).
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Background:
The Metropolitan Council is the formal project sponsor for the Blue Line Extension light rail transit capital project (BLE) and will be the federal grantee for any funding received from the Federal Transit Administration (FTA). This project is eligible for funding through the congressionally authorized Capital Investment Grant program, an important federal funding source for large transit capital projects. Later this year, the Metropolitan Council plans to submit a grant application to the FTA for $752 million. To support this grant application, all local funding partners need to demonstrate their commitment to provide their respective funding shares for the project. This resolution is intended to satisfy federal requirements for the Hennepin County Regional Railroad Authority’s commitment as a local funding partner.
Resolution 13-HCRRA-0062 committed up to $18.4 million in HCRRA funding for the Project Development phase activities associated with the project. Resolution 16-HCRRA-0026 committed up to $149,600,000 or ten percent of the total capital costs of the previous alignment; this resolution included the previous commitment to provide $18.4 million for Project Development activities.
In 2026, the Metropolitan Council identified an updated BLE project cost estimate of $3,580,739,000. Pursuant to Minnesota Statues Section 398A.10, HCRRA can provide a maximum contribution to light rail capital projects of 10 percent. This resolution would commit up to $358,000,000 of HCRRA property taxes towards the project, for a maximum funding share of 10%. If the FTA approves scope reductions for the project that result in an overall decrease in the project budget, then HCRRA’s funding commitment would decrease as well, in order not to exceed its statutory 10 percent maximum funding share. In order to finance this commitment, HCRRA has statutory authority to issue bonds backed by its property tax revenues. As of June 2026, HCRRA has already budgeted $129 million towards this capital project and has spent $76.8 million.
The BLE project design has undergone several community-informed revisions, to modify the previous route and advance the project, per the following completed and anticipated milestones:
• September 2020, the BLE project office was directed by Hennepin County and Metropolitan Council to find a new route for the BLE with the corridor communities that did not include freight rail.
• October 2024, the local cities along the corridor granted Municipal Consent to proceed with the engineering of the recommended route from Target Field Station northward into the communities of Minneapolis, Robbinsdale, Crystal and Brooklyn Park. The project then advanced the thirty percent design.
• May 2025, the Supplemental Final Environmental Impact Study was reviewed by the FTA and received public comments.
• May-October 2025, the sixty percent design plans were sent to local agencies for review/comment/approval.
• August 2025, the Amended Record of Decision was issued by FTA.
• April-June 2026, the ninety percent design plans were sent to local agencies for review/comment/approval.
• June 2026, the Rating Application and Pre-Risk Assessment was completed with the FTA and identified a project budget of $3,580,739,000.
• Upcoming project milestones include:
o Submitting a grant application to the FTA for $752 million
o Receipt of the Full Funding Grant Agreement, which secures the federal commitment
The Blue Line Extension will bring transformational opportunities to Hennepin County cities and residents in working class communities that have experienced a historic underinvestment and depressed tax base growth. It is a $3 billion investment in high-frequency transit for communities that have been waiting decades for transit improvements. The line will serve 83,000 residents within a half-mile of stations, of which 60% are BIPOC and 37% are low-income residents. The Blue Line Extension will provide affordable transportation options for corridor residents, resulting in an estimated 10,000 plus daily riders, decreased vehicle miles travelled, and reduced congestion in the Northwest Metro. With half of projected riders expected to come from households without a car, it will give thousands of residents new freedom to travel with dignity and ease to access opportunities to work, learn, play, heal, and grow. It will directly connect job seekers in the corridor to more than 200,000 jobs throughout the Blue Line corridor and give workers access to one-third of all jobs in the region with no more than one transfer to another high-frequency transit service. Land near light rail generates 27 times more property tax revenue per acre than an average parcel due to new development, while reducing the relative tax burden of existing residents and offsetting the need for future levy increases. To date, more than $14 billion has been invested near Twin Cities light rail lines-$10.9 billion of that has been within Hennepin County, generating $186 million in tax revenue annually. Similar development in cities along the Blue Line Extension will generate significant new revenue for local jurisdictions to invest in services, infrastructure, and schools. As the missing northern leg of the Twin Cities regional light rail system, the Blue Line Extension represents a generational opportunity to advance county priorities in disparity elimination, sustainable growth, and climate action.
Current Request: This action commits HCRRA to increase its funding share for the METRO Blue Line Extension light rail transit capital project (CP 1000941), from a 2016 commitment amount of $149.6 million, up to a new not to exceed amount of $358 million. This commitment is based on the revised cost estimate and construction schedule compiled by the Metropolitan Council, after municipal consent, and reviewed with the FTA. This commitment is an essential action for the FTA rating process that will help achieve a higher financial rating and overall higher project rating from the FTA.
Impact/Outcomes: This action supports the county’s disparity elimination and climate action efforts by investing in clean-energy transit infrastructure that expands transportation options and strengthens regional connections to housing, jobs, education, healthcare, and other essential destinations.
This request funds services that are: core services
recommendation
Recommendation from County Administrator: Recommend Approval