Week 2: Transportation funding issues heat up
Right out of the gate, both chambers of the Minnesota Legislature put forward transportation funding packages. It has been called the issue of the session. The need for reliable, efficient transportation touches everyone in their daily lives.
Governor Dayton made it very clear that his number one priority for 2015 will be increased transportation funding for State roads, bridges and transit. The Governor will propose wholesale and retail gasoline taxes as one way to generate funding. The specifics of his proposal will be released later this month.
House Republicans countered that while they support additional funds for transportation, they prefer to do so within the context of the State’s estimated $1 billion budget surplus for the next biennium. House Transportation Chair Tim Kelly (R-Red Wing) introduced HF4 on January 8 which he said was designed as a short-term fix until the House could better determine the State’s real transportation needs. The bill seeks to use a mandated 15% efficiency savings across the Minnesota Department of Transportation. Of the total package, $750 million would come from existing funds or capital bonding with no need for new taxes. The bill would earmark $200 million toward local roads and bridges.
Senate Democrats followed up with introduction of their bill, SF87 by Transportation Chair Scott Dibble (DFL-Minneapolis) on January 12. The Minnesota Department of Transportation (MnDOT) estimates a $6 billion funding shortfall for transportation over the next 10 years. Sen. Dibble stated that the need is not complicated and has been well documented. He lamented that our roads are less safe, accidents costly, goods and services can’t get to market in an efficient manner, and without proper transport our youth, disabled, and seniors are forced out of homes and community. Sen. Dibble remarked that we can’t build enough roads to accommodate everyone and need to find transit options. By contrast, House Republicans have no proposal for mass transit in their bill. The Senate bill increases revenue for funding to just under $800 million, with an additional $567 million for local road and bridge repair and replacement, as well as rail grade and crossing improvements through General Obligation bonds. It imposes a sales tax on gasoline at the wholesale level of 6.5% and increases license tab fees. There is some concern that the wholesale gas tax could bring in less money than projected if the price at the pump stays at current low levels.
Sen. Dibble recognized that the Republicans are not in favor of funding along the lines included in this bill and that there will be tough negotiations ahead. Republican House Speaker Kurt Daudt says it’s unlikely Republicans will vote for a tax increase to raise revenue for transportation but promised to keep working with Democrats this session to find common ground.