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Gov. Mark Dayton is challenging business leaders to support his plan to raise more money for transportation. 

In a speech to a Minnesota Chamber of Commerce dinner Wednesday night, Dayton didn't mince words with the audience of several hundred business leaders, lawmakers and lobbyists. He said revenue from the gas tax and license tab fees hasn't kept up with demand for road, bridge and transit projects. 

The governor is pushing to raise the wholesale tax on gasoline and increase license tab fees. He said those measures would generate about $5.8 billion over ten years. He would also like to add a new half-cent sales tax in the metro area to pay for transit projects.

"I don't relish having to raise the revenues needed to start fixing 25 years of deterioration and deficiencies in Minnesota's transportation systems," Dayton said. "I just consider it my responsibility, and I consider it yours." 

House Republicans and the Minnesota Chamber have suggested that the budget surplus and savings from within the Minnesota Department of Transportation could pay for road and bridge needs. Dayton has dismissed that approach, saying it won't help the state meet the $6 billion demand over the next decade.

"There is no easy solution. There are only real solutions and phony solutions," Dayton said. "I have said when you campaign for office you deal with rhetoric. However, when you serve in office, you deal with reality."

Republican House Speaker Kurt Daudt wasn't swayed by Dayton's call for a tax increase.

"You're going to have a tough time with this one, convincing me that this is the best solution for Minnesota," Daudt said.

Daudt suggested that House Republicans might not pass a long-term transportation bill this year. Instead, he said they might rely on surplus money to fund immediate needs.

"What we may need to do in the short-term is figure out how to put an influx of money into transportation," he said. "We may not be able to solve this on the long-term basis, but we have some money on the bottom line."

DFL Senate Majority Leader Tom Bakk said the Senate will support a bill that increases funds for roads, bridges and transit. He said clogged roads will result in lost productivity for business.

"We think ignoring this is at the peril of our business community," Bakk said. 

Last night's disagreement over transportation funding sets the stage for a five-month debate headed for the Legislature: A group pushing for more money for road, bridge and transit projects is scheduled to release its plan Thursday. 

The Minnesota Chamber has also been calling for more transportation spending, but has stopped short of endorsing a tax increase. In 2008, the chamber was instrumental in convincing the Legislature to override Gov. Pawlenty's veto of a gas tax increase. 

The Chamber's interim president, Bill Blazar, isn't ruling out support for Dayton's plan. But he said he wants to determine the scope of the problem first. He said the chamber supports maintaining the current transportation system and investing in some new projects. 

"We refer to it as maintenance-plus," Blazar said. "And he may have maintenance plus or maintenance plus-plus. But that's what we have to talk about and make a list."

For his part Dayton says the nature of the problem is clear, and that it's time for Minnesota to solve it by raising the money necessary to get the job done.

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In a speech to a Minnesota Chamber of Commerce dinner Wednesday night, Dayton said revenue from the gas tax and license tab fees hasn't kept up with demand for road, bridge and transit projects.

Dayton pushes business to back transportation funding; House GOP offers short-term plan

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