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Republicans unveil $7 billion transportation plan for Minnesota

“We think this is what Minnesotans have been asking for,” Republican House Speaker Kurt Daudt said of the plan, which doesn’t increase the state’s gas tax. 

“We think this is what Minnesotans have been asking for,” Republican House Speaker Kurt Daudt told reporters. “They’ve been telling us they want investment in our road and bridge infrastructure, and they’ve been telling us they don’t want a gas tax.”
MinnPost photo by Briana Bierschbach

The terms of the Minnesota transportation debate are now set, after legislative Republicans unveiled a new $7 billion plan to fund road and bridge repairs over the next decade that doesn’t raise any new taxes.

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House and Senate Republicans released a revamped transportation plan Monday that shifts about $3 billion of existing general fund money from taxes on auto parts, rental cars and auto leases into a new fund dedicated to road and bridge spending. The plan also dedicates $228 million of the state’s budget surplus to roads and bridges, $1.3 billion in Trunk Highway bonds, $1.2 billion from “realigning” resources within the Minnesota Department of Transportation (MnDOT) and promises to do more than $1 billion in bonding for roads and bridges over the next decade.

“We think this is what Minnesotans have been asking for,” Republican House Speaker Kurt Daudt told reporters. “They’ve been telling us they want investment in our road and bridge infrastructure, and they’ve been telling us they don’t want a gas tax.”

The new plan shows some movement — at least in terms of total dollars — toward what DFL Gov. Mark Dayton and Democrats in control of the Senate have been pushing. Dayton and the Senate are proposing a 16 cent per gallon increase in gas taxes, higher fees and a hike in the sales taxes in the metro area to pump about $11 billion into roads, bridges and mass transit over the next decade. An earlier plan from House Republicans put just $750 million into roads and bridges over the next four years.

Comparing transportation funding plans
Republicans’ new plan shows some movement — at least in terms of total dollars — toward what DFL Gov. Mark Dayton and Democrats in control of the Senate have been pushing.
GOP ProposalGov. DaytonSenate Democrats
Amount of funding
  • $7B over 10 years
  • $11B over 10 years
  • $800M in 2016
  • $1.1B annually starting in 2017
Source of funding
  • Moving existing auto part sales tax, car rental and leasing taxes into new "Transportation Stability Fund ($3B)
  • State budget surplus ($228M)
  • Trunk Highway Bonds ($1.2B)
  • "Realigning" resources in MnDOT ($1.2B)
  • General Obligation Bonding ($1.05B)
  • New 6.5% wholesale gas tax ($4.4B/10 yrs)
  • Increased vehicle registration and license fees ($1.45B/10 yrs)
  • ½ ¢ metro-area sales tax increase for transit projects ($2.8B/10 yrs)
  • MnDOT efficiencies (15% of agency budget — total unspecified)
  • General fund for Greater MN transit and bike/pedestrian upgrades ($145M/10 yrs)
  • Trunk Highway bonds ($2B/10 yrs)
  • New 6.5% wholesale gas tax ($580M/yr)
  • Vehicle registration fee increase($125M/yr)
  • ¾¢ metro-area sales tax increase for transit projects ($251M/yr)
  • MnDOT efficiencies (Unspecified amount)
  • Bonding for local bridge/road repair($567M)
  • Motor vehicle lease tax increase for Greater MN transit ($32M/yr)

But Democrats say the problem isn’t the amount of money, but rather how Republicans are funding transportation, using “budget gimmicks” that will take general fund money away from other things.

“The Republican plan is the same old shifts-and-gimmicks budgeting we've come to expect from them,” said House DFL Minority Leader Paul Thissen. “Siphoning money from schools and hospitals and relying on the state's credit card is no way to fund Minnesota’s transportation system. This is a ‘Give the Deficits Back’ Act.”

Republicans are pushing back on that narrative, saying the $3 billion they are shifting from the general fund is permanent, and a nearly $2 billion budget surplus for the next two years gives them enough wiggle room to prioritize funding within the rest of the state’s two-year, $40 billion budget. Full budget targets from House Republicans will be released on Tuesday. 

“It is out of the general fund but it is just as permanent as anything the governor has talked about,” said GOP Senate Minority Leader David Hann. “People in this state do not want additional taxes on gasoline.”

There’s also a huge gulf between DFLers and the GOP in another area — transit. Republicans dedicate just $16 million to metro and rural transit per year over the next decade. Dayton and Senate Democrats want closer to $3 billion over the next decade for transit development across the state.

Most of the money in the GOP plan would go directly to the state road system, while some would head to cities, counties and townships for their own repairs. Republicans say the plan will repair 15,500 lane miles and 330 bridges, but they didn’t designate specific projects like Dayton, who earlier this year released a list of more than 600 roads and bridges that would be repaired under his plan.

Republicans say they will leave it up to MnDOT to allocate funds to individual projects, but they believe the agency could fund nearly all the same projects with their plan.