Transportation Advancement Account

MnDOT Policy #FM028
Effective: July 23, 2026

Please go to the MnDOT Org Chart to find specific contact information: Org Chart.

Responsible Senior Officer: Deputy Commissioner/Chief Administrative Officer
Policy Owner: Financial Controller and Director, Office of Financial Management
Policy Contact: Budget Director, Office of Financial Management

Policy statement

After each February forecast, the Minnesota Department of Revenue (MDOR) estimates the amount of the monthly deposit into the transportation advancement account for use in the following fiscal year based on the estimate of average revenue derived from the taxes imposed under Minn. Stat. § 297A.62, subd. 1 on the sale and purchase of motor vehicle repair paint and materials from MDOR’s three most recent consumption tax models. Each month, MnDOT must deposit the amount equal to the estimated revenues derived from taxes on the sale and purchase of motor vehicle repair paint and materials in the state treasury and credit a percentage to the transportation advancement account.

Additionally, MDOR must deposit a portion of proceeds from the retail delivery fee imposed under Minn. Stat. § 168E.03 into the transportation advancement account as provided under Minn. Stat. § 168E.09.

Distribution and transfer of funds

MnDOT and the recipients agree that funds will be distributed in the fiscal year. During the soft close period, once all funds have been deposited, MnDOT must distribute or transfer the cash in the transportation advancement account to counties, funds, and accounts as specified in Minn. Stat. § 174.49.

For the 27% that goes to small cities, the funds will be distributed as specified by Minn. Stat. § 162.145.
For the 36% portion that goes to metro counties, the 15% portion that goes to larger cities, and the 1% portion that goes to the Department of Human Services for food delivery support, the funds will be directly deposited into their accounts during the soft close period.
For the 10% portion that goes to all counties and the 11% portion that goes to town roads, the funds will be apportioned through the annual Commissioner’s Order in January and will reflect the actual revenues from the previous fiscal year.

Reason for policy

Minnesota Statutes § 174.49 establishes the transportation advancement account and specifies the percentages of the fund that MnDOT must distribute to the specified counties, funds, and accounts, but does not specify when and how payments must be made. This policy establishes when and how funds will be distributed.

MnDOT does not have any administrative oversight into the use of these funds. Each entity is required to follow appropriate accounting practices to clearly show that the funds they receive are used according to the statutory requirements.

Applicability

All MnDOT employees must comply with this policy.

Key stakeholders with responsibilities under this policy include:

Commissioner
Chief Financial Officer
Financial Controller and Director, Office of Financial Management
Office of State Aid

Definitions

Soft close period

July 1 through mid-August following the end of the fiscal year.

Transportation Advancement Account

Account established by Minn. Stat. § 174.49, which consists of funds under Minn. Stat. § 168E.09, subdivision 2, and § 297A.94, and as provided by law and any other money donated, allotted, transferred, or otherwise provided to the account.

Responsibilities

Commissioner

Distribute or transfer funds in the transportation advancement account as provided by Minn. Stat. § 174.49.

Chief Financial Officer

Collaborate with recipients and the Office of State Aid regarding distribution and transfer of funds.

Financial Controller and Director, Office of Financial Management

Review the policy every two years, or sooner as necessary, to ensure the policy remains up to date.
Ensure documents associated with the policy remain current.
Monitor state, federal, enterprise, agency, or other requirements that apply to the policy or procedures.
Consult with the Office of Chief Counsel to ensure the policy and procedures remain compliant with all state, federal, enterprise, agency, or other requirements.
Ensure that necessary approvals by state or federal agencies are obtained before changes to the policy or procedures are implemented.
Work with the Policy Coordinator to revise the policy and/or confirm its accuracy.
Communicate policy revisions, reviews, and retirements to stakeholders.

MnDOT Policies