Lawmakers aim to wrap up transportation funding deal early

Updated: Feb. 16, 8:18 a.m. | Posted: Feb. 15, 3:02 p.m.

Minnesota lawmakers kick-started negotiations Monday for a road-and-bridge-repair funding package, but offered few signs that the large divide between competing plans has narrowed.

It's a struggle more than a year in the making. Despite flagging it as a top priority, the Legislature wrapped up last year's budget without a transportation package, instead leaving close to $1 billion on the state's bottom line to pursue a final deal.

But questions over the scope of the construction backlog remain — state estimates put it at $6 billion over the next decade — as do the partisan differences over how to pay for it. The top lawmakers on either side of the aisle leading negotiations expressed hope after Monday's joint hearing that last year's stalled debate would pave the way for a quick deal when the Legislature returns March 8.

"We certainly have the advantage of where we left off," said Rep. Tim Kelly, a Republican who chairs the House's transportation committee.

Senate Democrats are still pushing to bolster a highway fund with a gasoline tax that would hike prices by at least 16 cents per gallon, plus increasing vehicle registration fees. That's a non-starter in the House, where Republicans favor tapping the state's $1.2 billion budget surplus, shifting existing taxes — like on car part sales — to a dedicated transportation fund and leaning on an annual public construction borrowing package to pay for projects.

Republicans roundly rejected an attempt to hike gasoline prices last year, and Kelly wouldn't say whether he'd support any increases as part of a compromise. Minneapolis Sen. Scott Dibble, the Democrat shepherding the transportation debate in the Senate, said he'd back shifting some taxes in the final package — but other Democrats balked at the prospect.

"I think we're leaving a hole in the general fund that someone is going to have to re-fill," Eagan Sen. Jim Carlson said.

DFL Gov. Mark Dayton favors the Senate funding approach. He and other Democrats warn that the House plan is too big a hit on the general fund budget. But that didn't stop Dayton from declaring two months ago that the gas tax is dead, given the size of the budget surplus. He has since walked back from that political assessment.

Transportation is just one of the big leftovers from last session. Lawmakers also plan to restart negotiations on the tax bill that ran out of time last spring.

DFL Rep. Alice Hausman of St. Paul said she's worried about those two bills being linked again, along with a sizeable bonding bill, in end-of-session negotiations. Hausman said she's rather see the transportation issue settled early and openly.

"The public hates, and I think members hate, the thought that everything gets held up until the last minute, when two men go in a room somewhere and there's a deal that closes out the session," she said.