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STAFF REPORT <br />DATE: 6/16/2026 <br />CONSENT <br />TO: Mayor and Councilmembers <br />FROM: Jack Griffin. Municipal Sr. Project Manager <br />REVIEWED BY: Sarah Sonsalla, City Attorney <br />AGENDA ITEM: Approve the Local Road Improvement Program Grant Agreement Terms and Conditions for the <br />Trunk Highway (TH) 36 and Lake Elmo Avenue (CSAH 17) Improvements <br />CORE STRATEGIES: <br />☐ Vibrant, inclusive, connected community <br />☐ Responsive, transparent, adaptive governance <br />☒ Managed Growth <br />☒ Efficient, reliable, innovative services <br />☐ Balanced Finances now and future <br />☒ Resilient Infrastructure <br />BACKGROUND: <br />Washington County is leading an intersection improvement project at Trunk Highway (TH) 36 and Lake Elmo <br />Avenue (CSAH 17), including the construction of a South Frontage Road from Keats Avenue to approximately 0.4 <br />miles east of Lake Elmo Avenue (CSAH 17), to improve safety, capacity, and operation of the intersection and <br />surrounding area. The Project is planned to begin construction in June 2026 and is scheduled to be completed in <br />the fall 2027. <br />On December 16, 2025, the City Council approved a resolution approving Municipal Support for the Improvements <br />including the South Frontage Road Extension to Keats Avenue and including a right-turn-only access from <br />eastbound TH 36 to southbound Keats Avenue. <br />On May 5, 2026, the City Council approved a Cooperative Cost Share Agreement with the County, estimating the <br />Net cost share participation by Lake Elmo to be $2,430,000. <br />ISSUE BEFORE COUNCIL: <br />Should the City Council approve the Local Road Improvement Program (LRIP) Grant Agreement Terms and <br />Conditions for the Trunk Highway (TH) 36 and Lake Elmo Avenue (CSAH 17) Improvements in the amount of <br />$3,407,393.77? <br />PROPOSAL DETAILS/ANALYSIS: <br />As part of the Project funding, Washington County and the City of Lake Elmo received Local Road Improvement <br />funding as appropriated in 2023 and as amended in 2026, in the amount of $10,000,000.00 in general obligation <br />bond funds “for property acquisition and to predesign, design, construct, furnish, and equip a new interchange at <br />marked Trunk Highway 36 and County State-Aid Highway 17, known as Lake Elmo Avenue, in Washington County.”