Kudos to the Minnesota House GOP for advancing a long-term transportation funding package that provides for strategic and sustained investments without raising taxes, relying instead on efficient use of existing and new revenues. This is exactly the kind of investment that Polaris and many of the member companies of the Minnesota Chamber of Commerce and the Minnesota Business Partnership desire.
The proposal is a realization that the projected state budget surplus of nearly $2 billion makes it unnecessary to further increase taxpayer burdens in order to develop transportation infrastructure. Our state already ranks in the top 10 for individual and employer taxes in multiple categories.
We must broaden the source of funding to keep pace with transportation needs. Constitutionally dedicated revenues will remain the backbone of funding, but the buying power of the gas tax is diminishing as cars become more efficient. The House GOP package wisely recommends using the general fund to finance a portion of the needs. Thirty-three states do so, and for good reason. Transportation is an essential government service, yet, at present, Minnesota’s general fund does not contribute to our state roads and bridges.
The proposal’s detractors are pushing for a new “gross receipts” tax on fuel, which would start with a 16-cent-per-gallon increase and would increase as the price of fuel rises. They say using general-fund dollars for transportation will raid other programs. The House GOP proposal dedicates approximately $300 million per year in currently collected auto-related sales tax revenues to transportation. At less than 2 percent of our annual $20 billion budget, that’s certainly doable — especially given the billions of dollars in projected surpluses for the next four years. Those newly proposed funds, coupled with efficiencies and a responsible level of bonding, would inject $7 billion of new money over the next 10 years into our transportation system — on top of the approximately $2.5 billion per year that’s already dedicated to transportation through the fuel tax, motor vehicle sales tax and tab fees.
This is a smart and responsible proposal that provides substantial long-term, dedicated and reliable funding and deserves thoughtful consideration.
Scott W. Wine is chairman and CEO of Polaris Industries and chairman of the Minnesota Business Partnership.