Transportation money: Why the roadblocks?

Three times, Gov. Arne Carlson's office had a news release ready on a gas tax increase. Each time, he stopped short, deterred by a rural/urban split over how to spend the money. • Gov. Jesse Ventura won praise for a spare-the-rich lowering of license tab fees, but the move cut deep into transportation funding. • Gov. Tim Pawlenty's no-new-taxes roadblock, which impressed conservative admirers, became the rationale for his veto of two transportation bills.

Over the past 20 years, Minnesota's transportation funding for roads, bridges and transit has failed to keep pace with needs -- a point on which a broad consensus had emerged even before the collapse of the Interstate 35W bridge. In the aftermath of that disaster, there are signs that longstanding disagreements over how to raise and where to spend more transportation revenue may at last be resolved.

"The trick was to get this issue to become a top-tier political matter," said Curt Johnson, a former Metropolitan Council chairman and chief of staff for Carlson. "At 6:05 on August 1, one bridge collapsing may have done what no amount of advertising or lobbying could have ever done."

With every passing year, Minnesota faces an estimated $1.7 billion shortfall in funding needed to meet demands for maintenance, repairs and improvements. This is no pork-barrel pol's wish list. The projects on it are the hard-headed calculation of inspectors, engineers and analysts.

How did it get this way?

This year, Minnesota will collect about $650 million through its 20-cents-per-gallon gasoline tax. Another $478 million comes through license tab fees, while vehicle sales taxes produce $154 million.

That seems like a lot of money, especially when combined with Minnesota's share of federal highway funds and other smaller funding sources.

But the gasoline tax has been stuck at 20 cents per gallon since 1988. Adjusted for inflation, its real value has fallen by more than one-third.

Unlike that tax, which has long been dedicated to roads and bridges, the motor vehicle sales tax was not dedicated until last fall. In November voters approved a constitutional amendment phasing in a dedication of vehicle sales taxes to roads and transit.

But over the years, that revenue has often been tapped when funding crises have popped up elsewhere in the general budget.

License tab fee revenues took a hit when Ventura capped them at $99, creating a revenue hole that never was filled.

Historic struggles

The tension over whether and how to increase the gas tax has dogged governors and legislators.

Carlson said the state's transportation funding formulas are "very convoluted" and can come down to political divisions.

The formulas, he said, are "very old" and reflect a time when rural legislators held considerably more power at the Legislature than they do now. But the biggest hindrance, Carlson said, is Minnesota's inflexibility on how it can spend gas tax revenue. The constitution dictates that gas tax money be spent on roads and bridges. It cannot be used for transit.

In 1993, Carlson said, a gas tax increase never even made it out of DFL-dominated committees because "city folks wanted more for transit and rural folks didn't."

Old vs. new

Building shiny new roads and bridges often is more tempting than shoveling money into the essential but dull job of fixing old stuff.

"It's always easier to go and be the ribbon snipper, but it's harder to spend money and possibly raise taxes to pay for maintenance," said Bloomington City Council Member Steve Peterson.

A 10-year review of spending at the Minnesota Department of Transportation (MnDOT) shows that money for road and bridge construction has gone up every single year, no matter the state's economic straits. In 1997 the state spent $368 million on road and bridge construction. By 2007, it had soared to $760 million.

Compare that with operation and maintenance of said roads and bridges, which stood at $213 million in 1997 and, by 2007, with a few dips and peaks, hit $218 million.

Said Peterson: "If we don't come out of this with some way of making sure to maintain the things we have already bought, then we are not learning the lesson that the bridge tragedy is bringing to us."

Another issue, said Kevin Roggenbuck, coordinator of the Metropolitan Council's transportation advisory board, has been a preference for congestion-reducing road expansion projects instead of maintenance.

"People clamor more for capacity improvements than they do for preservation ... unless it's a pothole on their way to work," Roggenbuck said.

Spotlight on funding

The collapse of the I-35W bridge has thrust the state's deteriorating infrastructure into the spotlight. But the backlog has been building quietly for years, and not just in Minnesota.

A 2007 Urban Land Institute report on national infrastructure needs that surveyed 30 state transportation planning directors, including Minnesota's, said, "The state of deferred maintenance is so gargantuan nobody knows where to begin."

In this field, Minnesota is strictly average, ranking 27th among the states in per-capita spending on highways between 1999 and 2005, according to a report from the National Conference of State Legislatures.

But Finance Commissioner Tom Hanson, who previously served as Pawlenty's legislative liaison, said the choice of projects has always been "engineer and expert-driven."No matter who the governor has been, there has been really no cherry-picking of the list," he said.

Hanson said the real fights come not over individual projects but broad policy issues -- such as the funding split for new construction vs. maintenance, roads vs. transit, rural vs. metro.

"When it comes to money for rural roads vs. urban transit, an Iron Range Democrat can have more in common with a southeast Republican," Hanson said.

Competing transportation needs will remain. The question is whether transportation funding as a whole will rise in importance from the collapse.

"Too many legislators have looked backward rather than forward," said Bill Schreiber, a former legislator and MnDOT official in the Carlson administration and now a lobbyist for several transportation groups.

"There's been an unwillingness to bite the bullet and say that transportation is a priority."

plopez@startribune.com • 651-222-1288 mbrunswick@startribune.com • 651-222-1636 lblake@startribune.com • 612-673-1711