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Road construction along I-94.

David Joles, Star Tribune

Highway funding stuck in reverse

  • Article by: KEVIN DIAZ
  • Star Tribune
  • March 12, 2012 - 5:51 AM

WASHINGTON - Minnesota's aging roads and bridges are facing a reckoning in Congress.

Distracted by partisan battles, lawmakers are struggling to fund upgrades to a decades-old transportation infrastructure that highway engineers say is deteriorating faster than the nation's ability to keep up.

The Senate remains at an impasse, but the House is working on a plan that would actually give Minnesota nearly $50 million less this year compared to last. The prospective cut mostly reflects the GOP-led ban on earmarks, which have provided the state with about $150 million in additional transportation dollars since 2010.

Congress relies heavily on the federal gas tax to help fund highway upgrades, but the tax expires at the end of this month. With each passing day, transportation officials across the country are waiting to see whether lawmakers can break the partisan logjam, which has held up a major road bill -- in one form or another -- for 2 1/2 years.

Gov. Mark Dayton and metro-area leaders say congressional action this month will affect their ability to plan upgrades for deteriorating roads and bridges that cost Minnesota motorists million of dollars a year in vehicle repairs, commute times and operating costs.

"Even without any cuts we don't have the funds necessary to do the projects that we need to do to even maintain Minnesota's system where it is today, much less improve on it," Dayton said during a recent visit by Democratic governors to the White House.

If lawmakers do not reach agreement, states may have to settle for another in a series of short-term extensions -- essentially flat-lining road spending for the foreseeable future.

Money lost or money gained?

Underscoring the partisan differences are competing versions of how to count federal aid to the states. Democrats say that a GOP House proposal now would cost Minnesota more than $313 million in highway funding over the next five years, along with an estimated 10,890 jobs. Republicans see an increase of $30 million for Minnesota over the next four years.

The difference? It depends on whether the projections are based on this year's reduced federal spending levels, or last year's -- both fattened by leftover earmarks from the last major road bill. That was the spending plan Congress passed in 2005 with Alaska's infamous "Bridge to Nowhere," an unpopular pork-barrel project that helped shut the door on earmarks.

Either way, transportation experts warn that the trend on infrastructure investment is going in the wrong direction, a concern that has grown since the collapse of the Interstate 35W bridge in Minneapolis in 2007.

"Unless you come up with some significant revenue, we're going to see decreases for both highways and transit," said Margaret Donahoe, executive director of the Minnesota Transportation Alliance, the voice of the state's transportation industry and labor groups.

The funding squeeze has been clouded in Congress by a long string of skirmishes. A partial list of the political flashpoints: drilling in Alaska's Arctic National Wildlife Refuge, building the controversial Keystone XL pipeline, cutting federal pensions, funding public transit and allowing companies to opt out of birth control coverage for religious reasons.

With dozens of amendments in the offing, Senate Democrats tried to end a Republican filibuster on Tuesday. The vote failed, leaving open questions about a deal in the coming weeks.

'Business understands'

As transportation experts see it, the crux of the problem is a chronic shortfall in the federal Highway Trust Fund, which has been hit by a bad economy, changing driving habits and more fuel-efficient cars.

The Trust Fund, fed by an 18.4-cent per-gallon tax on retail gasoline sales, is expected to run out of money by next year. The tax levy has not changed since 1993, and is not likely to anytime soon, particularly in an election year.

Republicans such as first-term Minnesota congressman Chip Cravaack, a member of the House Transportation and Infrastructure Committee, say raising the gas tax would be bad for the economy.

"It's going to severely impact truckers," said Cravaack, who unseated DFLer Jim Oberstar, one of the architects of the 2005 road bill, which earmarked money for bike trails and other non-road projects Republicans want to cut.

"That cost has to be transferred somewhere, and ultimately it goes down to the consumer."

An array of business and industry groups, including the American Trucking Association, has been calling for an increase in the federal gas tax for years.

Minnesota Democrat Tim Walz, who also sits on the transportation committee, acknowledges that, for better or for worse, raising the gas tax seems politically impossible right now.

"This is hard on constituents," he said. "I get it, especially at a time of deficits that need to be addressed. But the issue, especially with transportation, is that to not spend a penny more ends up costing that $105 billion [annual] 'idling tax,' delayed products, and things like that. Business understands that clearly."

Republicans have sought to close the gap with money from new oil and gas leases, both offshore and in such places as Alaska. Walz and other rural DFLers, including Minnesota's Collin Peterson, have expressed support for some of the GOP oil and gas provisions, even as most Democrats remain opposed. But in a vote on the plan, Peterson was the only Minnesota Democrat for it. Rep. Erik Paulsen was the only Minnesota Republican to vote no.

It is unknown whether future oil and gas royalties can plug the hole in the Trust Fund, which is projected to go bankrupt by 2016.

'We cannot rebuild'

As it stands, the House energy provisions are considered dead on arrival in the Democratically controlled Senate. Senate Democrats have dominated the debate in recent weeks with efforts to limit amendments and close debate on their two-year, $109 billion highway bill.

Meanwhile, House GOP leaders have debated scaling back a five-year, $260 billion plan. Democrats have assailed it as a "giveaway" to oil and gas interests while conservative groups such as the Club for Growth slam the bill for overspending.

House Speaker John Boehner, R-Ohio, is under pressure to make the bill smaller and shorter-term. That worries transportation analysts looking for significant, new long-term investments to modernize the nation's neglected transportation system.

"We cannot rebuild this economy and this nation by shrinking the investment in the very transportation infrastructure that leads to more jobs and a better-connected economy," said Transportation for America Co-Chair John Robert Smith, the former Republican mayor of Meridian, Miss.

Meanwhile, the uncertainty in Congress is being felt in the Twin Cities, where metro officials want to plan out new road and transit projects such as the proposed Southwest light-rail transit line through St. Louis Park, Hopkins, Edina, Minnetonka and Eden Prairie.

Hennepin County Commissioner Peter McLaughlin says the standoff in Washington has already given ammunition to transit skeptics who ask, "How do you know you're going to get the money from the federal government?"

Kevin Diaz is a correspondent in the Star Tribune Washington Bureau.

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