Dakota County can now literally pave the way for bus rapid transit on Cedar Avenue.

A $17.7 million grant from the Counties Transit Improvement Board fills a budget gap and enables the county to start acquiring land and locking down construction contracts for roadwork and improvements on Cedar Avenue, including bus-only shoulder lanes from 138th Street to 181st Street and pedestrian-friendly streetscapes.

Roadway construction projects on Cedar Avenue, set to begin in 2010 and continue through 2012, are expected to cost $57 million.

"It's a big step," said Mark Krebsbach, the county's transportation director.

Dakota County Board members are expected to formally accept the grant at the Regional Rail Authority meeting Tuesday.

And the money comes not a moment too soon. The county needed to begin acquiring right of way for the project this winter in order to start construction next year.

"We can now start the acquisition of the properties and the contracts," Commissioner Will Branning said. "We couldn't do that until we had the funding."

The construction in 2010 won't mess with traffic flow much because the focus will be on preparation of the area around the road, such as relocation of nearby utilities. Work on the road itself will be done in 2011 and 2012.

Construction on the roadway is just one part of the county's bus rapid transit project, which is ultimately meant to function like light rail on rubber wheels with buses running station-to-station in dedicated lanes from Lakeville up to the Mall of America.

The first stage of the project, including new stations, bus shoulders, station-to-station buses and other amenities, is expected to cost $105 million.

A new transit station in Apple Valley at 155th Street will open for service on Jan. 4. Another in Eagan at Cedar Grove is under construction and expected to be completed in March. And a new park-and-ride in Lakeville at 181st Street opened in November.

New buses have not yet been purchased.

Branning said the county is still seeking about $9 million to pay for an on-board fare collection system and other technology for the buses and transit stations. "We will go to our legislators for that," he said.

The county has drawn from more than a dozen different sources of local, state and federal funding for the project. And an infusion of federal grant money that came to the Twin Cities as part of a congestion-reducing experiment accelerated some aspects of the project.

The Counties Transit Improvement Board, which doles out money collected under a quarter-cent sales tax, has so far pledged $23.2 million to the construction of the Cedar Avenue Transitway, including the recent grant and $5.5 million for the Apple Valley Transit station.

Katie Humphrey • 952-882-9056