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New bridge doesn't fix transportation problems

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One reason is money. The federal transportation checking account is empty.  Second, there's not much appetite among Minnesota lawmakers to raise taxes for additional transportation funding.

At the federal level, the transportation funding crisis has been fixed for the moment. Congress has passed and the president signed legislation Tuesday for $8 billion to replenish the empty Federal Highway Trust Fund.

Minnesota's transportation checkbook isn't empty. But the state has some big loans to pay off.

Wakota Bridge sign
Reconstruction of the Wakota bridge, which carries traffic on I-94 across the Mississippi River in the southeastern metro area, is not complete even after seven years.
Photo courtesy of MnDOT

The state went on a transportation spending binge earlier this decade, which was financed mainly by borrowing -- including spending ahead on the expectation of getting federal transportation revenue.

As a result, a sizable portion of Minnesota's  transportation budget is already spoken for.

"Because we're paying off those bonds and advance monies we took from the feds," said state Rep. Bernie Lieder, DFL-Crookston, who chairs the House Transportation Committee.

Earlier this year during the legislative session, Gov. Tim Pawlenty and lawmakers supplied daily daytime drama as they wrangled over a new state transportation bill.

In the end, Pawlenty vetoed the bill, and lawmakers overrode the veto.  The result raises the state gas tax by a nickel a gallon. It went up 2 cents a few months ago, and the the remaining 3 cents is added in October.

Transportation chairs
From left, Rep. Bernie Lieder, DFL-Crookston, and Sen. Steve Murphy, DFL-Red Wing, are the chairs of the House and Senate transportation committees.
MPR Photo/Tom Scheck

The law also raised vehicle registration fees.  And it includes nearly $2 billion in bonding -- borrowed money -- for road and bridge projects over the next decade.

Margaret Donahue, executive director of the Minnesota Transportation Alliance, a transportation advocacy group, says all that additional money funds only about one-third of the state's transportation wish list. 

Donahue and others say the unmet needs amount to $1 billion a year. 

"A lot of projects people were thinking we might get done -- like completing the beltway [around the Twin Cities], finishing [Highway] 610, fixing places where we switch from two lanes to four lanes to two lanes and back again, having a real transit network in the metropolitan area -- those things we don't have the money to do, even with this bill," Donahue said. 

There are some options for additional money for transportation spending.  However, State Sen.  Steve Murphy, chair of the Senate Transportation Committee, says going to the traditional and most lucrative one is not an option.

How the mileage tax is collected
This diagram shows how the state of Oregon keeps track of mileage for taxing purposes. A similar taxing plan is being considered in Minnesota. A transponder in the vehicle records the mileage, and when the driver goes to a gas station the mileage tax is added to the bill.
Image courtesy of the Oregon Department of Transportation

"Definitely not the gas tax.  We're going to be moving away from that, probably in 10 years," Murphy said.

Federal and state fuel taxes still bring in billions of dollars for roads and bridges.  But growth in fuel tax revenue has peaked and is declining.  

The reason is the slumping economy -- people are driving fewer miles.  Also, more fuel efficient  cars and alternative fuel vehicles are cutting into gasoline sales.

The future funding source, Murphy says, is a user fee that would charge based on the number of miles a vehicle travels.

Nearer term, some Minnesota lawmakers think there may be a way to raise some transportation dollars by redesigning the state sales tax, which is at 6.5 percent.  The change might be a lower sales tax, which would be imposed on more goods like clothing, which is now exempt.

Road in central MN
Some lawmakers from rural areas say their districts aren't getting as much transportation money as the metro area, and as a result it will be hard to come up with a long-term transportation funding plan.
MPR Photo/Tim Post

Urban and rural lawmakers at the end of the session were able to overcome some geographic and partisan differences and craft a transportation bill that addresses what many see as two decades of neglect of the state's transportation system.

House Transportation committee chairman Bernie Lieder says he doesn't expect the cooperative spirit to last.  Lieder says some rural lawmakers feel robbed -- that too much transportation money is going to urban areas, even though others claim the split is close to 50/50.

There are enough hurt feelings, Lieder says, that transportation spending legislation faces gridlock.

"And I don't think we're going to spend time on a transportation bill again for quite some time," he says.

Lieder predicts it will be after 2010 -- after the next census and after legislative redistricting, which will likely create an urban/suburban majority in the Legislature --  before transportation legislation moves forward again.