Street maintenance can be delayed for a while but not indefinitely, many Minnesota cities are discovering. Allow potholes to accumulate — as many cities have done as state transportation funding and local government aid (LGA) have lagged — and streets eventually become a crumbling, costly mess.
As a result, scores of city officials are keen to do more to fix their streets. Take Mayor Emily Larson and the Duluth City Council. On Monday, they asked voters in their city's Nov. 7 election to approve a half-cent addition to the local sales tax, to be dedicated entirely to street improvements. It would raise the total sales tax rate in Duluth to 8.875 percent and add $7 million a year to city street budgets, nearly tripling the sum available today.
Duluth's voters won't have the final word on the street tax idea, however. That belongs to the Legislature. State government made an implicit bargain with cities decades ago: The state will supply municipalities with LGA and will share a fixed portion of the highway-dedicated gas tax with the state's larger cities. In exchange, cities will yield to the state the authority to levy an income, sales or gasoline tax within their jurisdictions. Cities can only employ those tax measures with the Legislature's permission.
It's a deal that used to serve cities well. LGA is distributed based on cities' needs relative to their capacities to raise property taxes. That's fairer than allowing high-income and/or retail-rich cities to go it alone with city sales and/or income taxes, while others languish. And while the gas tax — like the sales tax — hits poorer taxpayers proportionately harder than higher income ones, it has the virtue of being essentially a user fee. Those who don't buy gas don't pay.
But by cutting LGA during economic downturns and raising the gas tax just once since 1988, the Legislature hasn't kept its part of the bargain. Even with a modest increase enacted this year, LGA will still send $30 million less per year to the state's cities in 2018 than it did in 2002.
Many cities coped with LGA cuts by deferring any spending they could. Street maintenance fell into that category — for a while. But "pavement has to be maintained on a regular basis to preserve it and maximize its life span," said Anne Finn of the League of Minnesota Cities. "For every $1 that's spent on maintenance, $7 is saved in repairs down the line. Postponing maintenance just adds to that cost."
Finn helped assemble a coalition of large and small cities to appeal to the Legislature for help, particularly for the cities with fewer than 5,000 people that receive no gas tax proceeds. So far, the Legislature's response has been underwhelming. This session provided $8 million in each of the next two years for small-city streets. Lawmakers spurned a request for a street-dedicated $10-per-year surcharge on vehicle license tabs, which would raise a more robust $57 million annually.
Larson is out of patience, and for good reason. Already 55 percent of the pavement in her city of 86,000 is rated as poor, and 91 percent of Duluth residents surveyed said they lack confidence in city streets. The deferred maintenance backlog is approaching $450 million, she said. Her proposed 2018 budget cuts cuts all other spending categories in order to find a paltry $1 million more for streets.
Another source of revenue is badly needed, Larson said Monday. "I won't wait any longer for a rescue from the outside. It's not coming. It's time to be proactive, prioritize infrastructure, demonstrate that government can and will provide the basic services people need, and take care of this ourselves."
If Duluth's voters go along with a half-cent sales tax boost, Larson hopes the 2018 Legislature will, too. We concur. Duluth's needs are too great to ignore. But we also hope legislators share our regret at the unraveling of a state-local partnership that has served Minnesota well and that they resolve to strengthen that partnership in future state budgets.
All of Minnesota's cities, not just retail-rich regional centers, should be able to keep their streets paved.