Financing Health and Planning Initiatives:

This page provides a list of funding sources that communities can use to help incorporate health into planning through the implementation process. The page is broken down by local, state, federal and private sources of funding

Local Sources

  • Taxes

    • Property tax: Property taxes are a primary source of local revenue source in the United States . Their primary function is to fund services that are administered at the most local levels of government, such as street maintenance and public transit operations.

    • General Sales tax: The state of Minnesota has a 6.5% general sales tax; local municipalities can initiate a local sales tax beyond that state tax rate to raise funds for infrastructure and capital improvement projects.

    • Selective sales tax: taxes placed on select items (e.g. gas, alcohol, tobacco, public utilities, lodging) can be used to enhance local budgets. For example:

      • Local taxes on motor vehicle fuels, such as gasoline, are authorized in 15 states, and have been adopted in ten. In states where they are in use, the funds support the operating budgets of county road departments, much like state gasoline taxes that are passed down to the local level in other states. In Alabama and New Mexico , revenues from local gasoline taxes are often used for non-transportation purposes, such as education or health care. In most states, local gasoline taxes have not been adopted at high enough levels to fund major new capital investments.

      • Real estate transfer taxes (RETTs) (also known as "real property transfer taxes") are state, county, and/or municipal sales taxes most often used as general revenue. However, RETTs, can be devoted to specific uses such as affordable housing development or open space protection. See  http://www.policylink.org/EDTK/RETT/ for more information.

    • Individual income tax: Some municipalities have adopted payroll taxes (or income/payroll combinations) to enhance local budgets.

    • Vehicle license tax: A wide range of taxes on motor vehicles are used to fund local investments. The most important varieties are license or registration taxes, which tend to be either flat fees based on vehicle type, or variable taxes based on a vehicle's value. Thirty-three states authorize some form of local vehicle taxes. Many of the states allow these taxes to be used as a general revenue source. As with local option gasoline taxes, these taxes typically fund pay-as-you-go programs of routine maintenance and operations.

    • Tax increment financing: Tax increment financing (TIF) is a method of financing real estate development of property that is otherwise too costly to develop for a variety of reasons. The use of TIF relies on an increase in real property taxes over the base rate, generated within a designated area. The local government determines the property tax revenue it is collecting in the given area before redevelopment occurs. Then they borrow money, with loans or by the sale of bonds. The borrowed funds are used in various ways to improve the development prospects of the area: loans to new businesses, capital improvements, redevelop contaminated sites, new services such as improved street cleaning and security patrols, advertising and marketing,and incentives to developers. As development occurs in the area, tax revenue increases, and the excess above pre-redevelopment property tax revenue in the area is used to pay off the loans or bonds and to finance further redevelopment activities. TIF has traditionally been used as a means of redeveloping blighted urban areas. Its use has spread to other purposes. TIF in Minnesota is generally used to:

      • Redevelop areas occupied with substandard buildings
      • Build housing for low-income and moderate-income families
      • Clean up pollution
      • Provide general economic development incentives
      • Finance public infrastructure, such as streets, sewer, water, sidewalks, and similar improvements. (This is not an explicit purpose of TIF, but Minnesota cities frequently use it for this purpose.)
      • For more information please visit the State of Minnesota 's Tax Increment Financing (TIF) page: http://www.house.leg.state.mn.us/hrd/issinfo/tifmain.htm

  • Impact fees & Exactions :
    Impact Fees and exactions are charges or dedications collected on a one-time basis as a condition of an approval being granted by the local government. The purpose of the fee or exaction must directly relate to the need created by the development. In addition, the amount of the exaction or fee must be proportional to the cost of improvement.

    • Impact fees are charged to developers and collected to pay for the construction or expansion of off-site capital improvements that are necessitated by and benefit the new development (i.e. public facilities and services such as: parks, schools, sewer, water, transportation, and public safety)

    • An exaction is when a government requires that a landowner dedicate land or a property interest, such as an easement, as a condition for granting a development permit.

  • User Fees
    User fees are used to help pay for a variety of public services and facilities, such as entrance into state parks, driving on highways, entrance fees for swimming pools, and meters for parking.

    • For example, many cities have funded water resources management programs with their own financial resources. Cities can fund such programs in a variety of ways: property taxes, special assessments, development fees, land exaction in lieu of fees, and user charges. In recent years many cities have created Stormwater Utilities , which allow individual property owners to be charged for stormwater management in direct proportion to the volume of stormwater leaving the property and also the quantity of pollutants in the runoff.  For additional useful information, please review the Stormwater Utilities Report - (PDF, 865 kb)

  • Seneral Obligation Bonds – General obligation bonds are sold by local governments to raise funding for general expenditures or to fund specific capital improvement or facilities projects. They are typically used for expenditures or projects that benefit the entire community. The full taxing power of jurisdiction is pledged to retire the debt incurred when the bond is sold. The bonds may be subject to municipal debt limits and may require a public referendum vote.

  • Revenue bonds – Revenue bonds are sold by local governments to finance revenue-producing improvement projects (e.g. municipal parking ramp, swimming pool). The bonds are repaid using the revenue generated by the facility over time.

  • Special Assessments – Special assessments are used to fund projects or services that benefit specific properties, such as paving a neighborhood street or extending the sanitary sewer. Property owners are required to pay the cost through a tax assessment.

  • Special Service Areas or Districts: Cities can use a special service area designation as a way to raise cash to finance extra services, improvements, or facilities that will benefit the targeted area. Projects commonly include security, storefront rehabilitation, advertising and promotion, and business retention or attraction efforts; some communities have used this tool to finance infrastructure upgrades at industrial parks. Property owners in a defined brownfield area could use this approach to raise funds to cover cleanup costs. In establishing a special service area, property owners in the proposed district agree that a real estate levy or special fee be imposed in the defined area that will benefit from the proposed services or activities. The jurisdiction uses this additional revenue to finance the improvements, either earmarking it directly to the area, or using it to issue bonds to fund area projects.

    • One type of special service area or district is a Business Improvement District (BID). BIDs are areas in cities defined by state and local legislation in which, the private sector delivers services for revitalization beyond what the local government can reasonably be expected to provide. The properties and/or businesses within this legally constituted district pay a special tax or assessment to cover the cost of providing facilities or services for which the district has a particular need, such as sidewalk construction, security services, or lighting improvements. The BID, while facilitated by the local government, provides flexibility for individual business districts to control the assessment and expenditure of funds that provide direct benefits to them.

Regional

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State Level Sources

  • Minnesota Pollution Control Agency
    Various types of financial assistance are available to the Minnesota Pollution Control Agency including:

    • Clean up. Grants are available to address brownfield and septic system cleanup.

    • Environmental Assistance Grants. This program provides financial assistance in the development of environmentally sustainable practices, including four focus areas: (1) renewable energy generation, energy efficiency, and greenhouse gas reductions; (2) solid waste; (3) stormwater pollution prevention and assistance; and (4) sustainable actions.

    • Water Issues. Funding is available to address issues of phosphorus, point and non-point source pollution, and wastewater and stormwater management and construction.

  • Mn/DOT

  • Minnesota DNR Grants

    • Land conservation grants

    • Remediation Fund Grant Program. This program provides funding for the acquisition of natural areas and restoration of native plant communities.

    • Metro Greenways Protection and Restoration. This program is focused protecting, connecting, restoring, and managing a regional network of natural areas, parks, and open spaces. It funds land protection and restoration projects on public and private land.

    • Natural and Scenic Area Grants. This program provides matching grants for the cost of acquisition of natural and scenic areas.

    • Recreation Grants. The DNR provides a number of grants to assist local governments in the acquisition, development, and redevelopment of parks, trails, and natural areas. Grants include, but are not limited to:

      • Outdoor Recreation Grants
      • Regional Parks Grants
      • State Park Road Account Program
      • Cross-country Ski Trail Grants-in-Aid Program
      • Local Trail Connections Program
      • Regional Trail Grant Program

      • Federal Recreational Trail Program

    • Environmental and Conservation Partnerships Grant Program. This program provides funding for enhancing fish, wildlife, and native plant habitats; research and surveys of fish and wildlife; and environmental projects and education activities.

    • Minnesota ReLeaf Program. This program provides funding for purchasing and planting native trees to conserve energy, benefit wildlife, and create windbreaks; preserving and maintaining health community forests; education programs; and conducting tree inventories for land use and comprehensive planning.

    • Shoreland Habitat Restoration Grant Program. This program funds the restoration of native shoreline vegetation to protect habitat and enhance water quality. For more information see.

  • Greater Minnesota Housing Fund. Greater Minnesota Housing Fund's programs provide financial and technical assistance resources to help facilitate the creation of affordable housing in Greater Minnesota. These programs include (but are not limited to):

    • Planning and Building Better Communities in Minnesota 's Growth Corridor. Through partnering with interest communities, and serving as a catalyst for other philanthropic and local investments, the principles of GMHF's Growth Corridor Initiative are: planning, land use, housing and community participation & local control. (Click on the “programs” at http://www.gmhf.com/ for more information)

    • Housing and Redevelopment Authority Initiative: GMHF technical assistance helps local governments to maximize resources for affordable housing in order to expand and strengthen local housing programs in greater Minnesota. (Click on the “programs” at http://www.gmhf.com/ for more information)

    • Building Better Neighborhoods: This program provides tools to help local governments guide the creation of affordable housing, better neighborhoods, and balanced community growth. GMHF's Interim Financing Program, Down paymentAssistance Program, and New Construction Gap Financing are available.

  • Minnesota Department of Employment & Economic Development
    Minnesota communities can tap into the Department of Employment and Economic Development's financial and technical assistance programs to help spur business growth while addressing important revitalization issues. DEED offers grants, loans and technical assistance for redevelopment projects and activities, including housing and commercial rehabilitation, wastewater treatment facilities and drinking water systems, and contaminated site clean-up. Some of the programs available are:

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Federal level

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Private foundations

  • Funders' Network for Smart Growth and Livable Communities : an active resource and focal point for foundations, nonprofit organizations and other partners working to solve the environmental, social, and economic problems created by suburban sprawl and urban disinvestment. While their purpose is to assist grantmakers understand the issues and opportunities associated with smart growth and not to facilitate connections between grantmakers and grantseekers, their web site offers a searchable database of approximately 52 private foundations that support various elements of smart growth, including, but not limited to: infill, development, infrastructure investments, land use planning, brownfield redevelopment, historic preservation, habitat protection, environmental education, supporting neighborhoods, transportation, and promoting regional collaboration.

  • The McKnight Foundation Grants Program

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Additional Information about local governmentfunding

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