MnDOT not insulated from fiscal pain

  • Updated: January 27, 2009 - 9:14 PM

The Minnesota Department of Transportation gets nearly all of its funding from gas tax revenues, vehicle registration fees, vehicle sales taxes and federal outlays, so the agency is largely on the sidelines during the deficit crisis. Transportation makes up only 1.1 percent of the governor's proposed general-fund expenditures.

But MnDOT is not immune to the problems of the broader economy. The recession has dragged down car sales and the attendant tax revenues, and Minnesotans are driving fewer miles and buying less gasoline. Increases in the gas tax and in the percentage of vehicle sales taxes dedicated to transportation mean that MnDOT will receive more money, "but the increases are lower than previously forecast," according to the department's budget.

Because of that, MnDOT is trimming $44 million from its highway spending for the remainder of the current fiscal year and cutting some operating expenses in 2010-11, but "no currently programmed projects are affected by these changes," Commissioner Tom Sorel wrote in his budget letter to the governor. He added that federal legislation "will, of course, be of great importance for future funding levels."

JIM FOTI

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