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Coalition of Greater Minnesota Cities official: bonding wins but lead-service funding falls short
Summary
Bradley Peterson of Flaherty & Hood, speaking for the Coalition of Greater Minnesota Cities, told the council the legislature passed a $1.24 billion bonding bill with substantial water and wastewater investment, preserved Local Government Aid levels and defeated state-level housing zoning preemption; he said lead service line replacement received far less funding than advocates requested.
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Bradley Peterson of Flaherty & Hood, speaking on behalf of the Coalition of Greater Minnesota Cities, briefed the Virginia City Council on the 2026 legislative session and what it means for Greater Minnesota communities.
Peterson said the legislature passed a $1.24 billion bonding bill, with more than $400 million targeted to water and wastewater projects and roughly $122 million routed through the Public Facilities Authority’s grant/loan programs. He said protecting Local Government Aid (LGA) was a priority and that the program remains roughly at $644 million per year. Peterson described defeat of proposed housing zoning preemption measures in committee this year and warned that similar proposals are likely to return in future sessions.
On lead service line replacement, Peterson said advocates sought about $250 million to follow the $240 million appropriated in 2023. “At the end of the day, there was only $15.01 million put into the lead service line program,” he told the council, and he warned that the shortfall could slow the pipeline of projects for the 2027 construction season.
Peterson encouraged local engagement ahead of the next legislative cycle and noted CGMC outreach to candidates, the upcoming summer conference and a planned legislative action day in Saint Paul. Council members thanked him for the update and confirmed they would continue coordination on EMS, infrastructure and LGA preservation.

