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State Representative Joyce Peppin
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-7806
For more information contact: Austin Bleess 651-296-5529
NEWS COLUMN
PUTTING CAR TAXES BACK INTO ROADS & TRANSIT
By Joyce Peppin
State Representative, District 32A
This fall, Minnesotans will be asked to vote on a constitutional amendment asking if they want to dedicate 100 percent of the Motor Vehicle Sales Tax (MVST) for roads and transit. If approved, all of that car tax money would eventually go to transportation needs by 2012.
You buy a car and pay the sales tax. That tax money should go for roads, right? It hasn’t always worked that way.
Beginning in 1981, state lawmakers began the first of many attempts to dedicate MVST funds to transportation. However, as in recent years, budget problems forced lawmakers to use MSVT money for general fund purposes. For most of the 1990s, all of the revenue from the MSVT went into the general fund.
Beginning in 2002, about 30 percent of the MVST was dedicated to the Highway User Tax Distribution Fund (HUTDF), a primary account for road money. However, that was done to replace lost funds when Gov. Jesse Ventura reduced car license tab fees -- no new money was dedicated to roads. And in 2003, about 20 percent of MVST money was dedicated to metro and rural transit to replace funding that was lost when a property tax levy for transit was abolished. Again, no new money was targeted for transportation.
Full dedication of current MVST monies would mean an additional $250 to $300 million annually for roads and transit. That would be the equivalent of raising the gas tax by 9 1/2 cents a gallon. Imagine this. If car taxes had been fully dedicated since 1981, there would have been an estimated $7 billion more for roads & transit.
While there have been calls to raise the gas tax to better fund road and transit needs, I believe taxpayers first deserve some truth-in-advertising regarding the MVST. There is an expectation that those funds would go to service the roads we drive on. With a predictable and dedicated source of revenue each year, road planners and builders could more effectively map out highway and transit projects years into the future.
While such a dedication would compel lawmakers in 2007 and beyond to do with less in the general fund, it would help bring accountability and clarity to our tax system. Please consider voting “yes” to the MVST ballot question in November.
Rep. Peppin represents District 32A, which includes the communities of Corcoran, Dayton, Greenfield, Hanover, Rogers, Hassan Township, and southwestern Maple Grove. Peppin invites anyone to share their questions or comments about state government with her. She may be reached by email at rep.joyce.peppin@house.mn; by phone at (651) 296-7806; or by U.S. Mail at 411 State Office Building, St. Paul, MN 55155.
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