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RELEVANT LINKS: <br />Minn. Stat. § 424A.02, subd. <br />3a. <br />Minn. Stat. § 424A.02, subd. <br />10. <br />Office of the State Auditor <br />525 Park Street - Suite 500, <br />St. Paul, MN 55103 <br />(651) 296-2551. <br />Minn. Stat. § 162.09. <br />Additional Information on <br />Sources of Revenue. <br />Minn. Stat. § 162.05. <br />Minn. Stat. § 162.11. <br />Minn. Stat. § 161.081, subd. <br />1. <br />Additional Information on <br />Sources of Revenue. <br />Minn. Stat. § 162.081 <br />The state apportions the money to qualifying cities for fire and police <br />pensions. If all of the police officers in the city police department are <br />members of the PERA Police and Fire Fund), the state peace officer aid <br />must be applied toward the city's employer contribution to the Police and <br />Fire Fund of PERA. If there is no firefighters' relief association and the city <br />is not a member of the statewide volunteer firefighter retirement plan <br />(SVFRP), then the fire aid must be used to maintain the fire department. <br />City councils preparing budgets should know that there is a penalty if a <br />defined benefit relief association pays out service pension benefits in excess <br />of the statutory limits. This penalty includes the possible loss of fire state aid <br />for the city. In addition, city councils should note that volunteer firefighter <br />relief associations associated with the city fire department must file a copy <br />of revised bylaws with the state auditor whenever they are amended or when <br />the city council approves any amendment to the relief association's <br />governing bylaws. Failure to file revised bylaws may also result in a loss of <br />state aid until such documents have been filed. <br />b. Highway user tax distribution fund <br />The Minnesota Constitution requires that state gasoline taxes and motor <br />vehicle registration fees provide funding for certain city, county, and state <br />roads. These revenues go into the highway user tax distribution fund <br />(HUTDF), and the Minnesota Department of Transportation (MnDOT) <br />distributes them. Twenty-nine percent of the fund is dedicated for certain <br />county roads and highways. Nine percent goes to cities with populations <br />over 5,000. The remaining 62 percent is dedicated to the state trunk highway <br />system. <br />Pursuant to article 14, section five of the state constitution, t 5 percent of the <br />net HUTDF is set aside for use on municipal and state roads. The 5 percent <br />breaks down as follows: <br />30.5 percent is devoted to the newly established town road account. <br />16 percent is devoted to the town bridge account, allowing townships to <br />use funds in the town bridge account to pay 100 percent of bridge <br />rehabilitation and replacement costs. <br />53.5 percent is devoted to the newly created flexible highway fund, to be <br />used primarily to fund trunk highway turnbacks (approximately $30 <br />million per year). Turnbacks are former trunk highways that the state <br />relinquishes control of to another level of government, for example from <br />state control to county responsibility. The flexible highway fund includes <br />turnbacks of county highways in the computation of municipal state aid <br />miles. <br />League of Minnesota Cities Handbook for Minnesota Cities 10/15/2015 <br />Municipal Budgeting Chapter 211 Page 17 <br />