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Big differences to bridge in transportation funding debate

Transportation Commissioner Charles Zelle addresses the House Transportation Policy and Finance Committee Jan. 26. Photo by Paul Battaglia

Gov. Mark Dayton and Republicans in control of the House appear miles apart on how to pay for fixes to Minnesota's aging transportation infrastructure after the governor on Monday unveiled his plan to raise $10 billion in new revenue over the next decade for road, bridge and transit projects.

The governor’s plan would impose a 6.5 percent wholesale tax on fuel sales atop existing gas taxes, increase license registration fees and increase a metro-area sales tax to fund bus and rail projects.

With Charlie Zelle, the state’s transportation commissioner, telling the House Transportation Policy and Finance Committee on Monday that Minnesota is facing a $6 billion shortfall to pay for needed road and bridge improvements over the next 10 years, Dayton said the Legislature needs to muster the “political courage” to act.

[MORE: See the governor's full proposal]

“No one wants to pay more taxes,” he said during a Monday morning news conference. “But conditions and congestion will keep getting worse until we do something about it.”

Rep. Tim Kelly (R-Red Wing)

No long-term solution in '15?

It is a plan that contrasts sharply with one put forward earlier this month by Rep. Tim Kelly (R-Red Wing), chair of the House Transportation Policy and Finance Committee. HF4 proposes $750 million in additional spending for roads and bridges over the next four years without raising any new revenue.

Instead, Kelly’s bill would fund road and bridge improvements by investing $200 million from the state’s projected budget surplus, utilizing existing, unspent highway funds and requiring the Department of Transportation to find up to $65 million in efficiencies within the agency’s existing budget. It includes no new funds for metro area or Greater Minnesota transit.

Senate Transportation and Public Safety Committee Chair D. Scott Dibble (DFL-Mpls) has pitched a plan similar to Dayton’s that would raise a projected $800 million per year in new funding for road, bridge, bus and light rail projects.

“We've shown we can address the problem with funds that are already there,” Kelly told reporters Monday, saying a long-term structural solution may not be passed this year.

Under the governor’s proposed wholesale fuel tax, Minnesotans would pay at least 16 cents more per gallon of gas at today’s pump prices. That figure would rise as the wholesale price of fuel increased.

Kelly characterized Dayton’s plan as too big and said the new fuel tax would hurt the lowest-income Minnesotans. He urged caution on new taxes before all sides agree on the scope of the funding problem.

“It seems to me the proposals being (put forward) right now from the Senate and the governor simply increase revenue without first getting us all around the table to agree on the need," he said. 

‘Two different planets’

In a statement, House Minority Leader Paul Thissen (DFL-Mpls) said his caucus cannot support a House transportation funding plan he called “a bridge to nowhere.”

“(I)t needs to be a comprehensive, long-term approach that doesn't rely primarily on general obligation borrowing or money currently used to fund schools and hospitals, and doesn't pit one part of the state against another,” Thissen said.

The governor acknowledged Monday that the two sides are far apart on one of the key issues of the 2015 session.

“We’re just talking off two different planets right now,” he said.


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