Gas tax increase dead, House Republicans again warn governor

House Republican leaders said Friday compromise will be needed to strike a comprehensive transportation deal before the Legislature adjourns in just nine days, but warned Gov. Mark Dayton that they still refuse to consider a gas tax increase as a part of any agreement.

House Speaker Kurt Daudt (R-Crown) told reporters during a morning news conference that Thursday’s meeting between Dayton and legislative leaders had been productive, and that he expects the governor to deliver a transportation offer on Monday to continue negotiations.

READ MORE Dayton: transportation compromise in the works for Monday

But a week after Senate DFLers offered to scale back their proposed increase to the state’s gas tax in order to provide a long-term boost to funding the state’s road and bridge needs, Daudt and other ranking House Republicans reiterated that their caucus will not accept any bump in the 28.5 cents-per-gallon tax in the final agreement.

“We urge (Dayton) to remember his own words from December that a gas tax is dead,” Daudt told reporters.

The latest Senate DFL offer proposed to nix their hoped-for wholesale tax on fuel that would have raised the gas tax by a minimum of 16 cents per gallon, and would instead phase a 12-cent hike in the per-gallon tax over three years.

That offer, Daudt said Friday, moved Senate DFLers further away — not closer to — House Republicans and a potential compromise.

House Republicans have proposed using $300 million of the state’s projected $900 million budget surplus next year for road and bridge projects, in addition to shifting an estimated $300 million per year in motor vehicle-related tax revenue away from the state’s General Fund to generate more transportation funding.

“To continue to talk about the gas tax is an exercise in futility,” said House Majority Leader Joyce Peppin (R-Rogers).

READ MORE House doesn't budge, leaving transportation negotiations in neutral

Dayton and legislative DFLers have said the Republican plan wouldn’t adequately address what the Department of Transportation has estimated to be a $10 billion funding deficit over the next decade.

The Republican proposal also includes no new dollars for metro area transit, an omission DFLers have said they could not accept in any comprehensive deal.

“Their plan would starve out the General Fund and, at the same time, not solve the problem,” House Minority Leader Paul Thissen (DFL-Mpls) said at a news conference. “I don’t know why you’d want to do both those things at the same time.”

Thissen said his caucus is not wedded to a gas tax hike, only that substantially more dedicated revenue for transportation needs to be raised and that the current House Republican plan would not achieve that.