Hennepin County may shift some sales tax dollars from transit to roads until new trains are running

Until the doors slide open for passengers on the Southwest and Bottineau light-rail lines, Hennepin County commissioners are looking to shift sales tax money from transit to road and bridge repairs.

Commissioner Jan Callison, who sponsored the proposal, said the move would pull roughly $10 million to $20 million pooling annually in a fund that had been earmarked for transit. The money is accumulating because the Southwest line was delayed and Bottineau has stalled.

If and when those lines are running, most of the taxes collected will go toward light-rail operating subsidies. Until then, the County Board wants it to go to roads and bridges.

"In the meantime, this is right for Hennepin County," Callison said.

The board split 4-3 in support of her proposal, which directs county staffers to come up with a plan in early 2020 that would project how much will be in the fund and how it can be used.

The divided board vote reflects the need for transportation funding and the philosophical division about where to spend it. As the state's most populous county, Hennepin County's sales tax is a cash juggernaut and the demands are significant.

Roads and transit lines in Hennepin County provide a nexus to many of the state's significant amenities, from the downtown Minneapolis business district to St. Paul, the Minneapolis-St. Paul International Airport, U.S. Bank Stadium, Target Field and the Mall of America in Bloomington.

Improving bridges and roads also helps transit users, pedestrians and bicyclists, Callison said.

But Board Chairwoman Marion Greene didn't buy it. She called the claim that diversion of funding would help transit users "window dressing." She was the most vocal opponent to the shift, calling it "alarming" because, she said, "we're chipping away at the future we want to build."

Hennepin County's half-cent transportation sales tax took effect in October 2017 and brings in roughly $135 million annually. The tax replaced one that had gone to the now-defunct Counties Transit Improvement Board (CTIB).

That board split up because of disagreements among member counties over how and where to spend the money. Now the counties make those decisions on their own.

During the county debate, Greene suggested holding out on redirecting the sales tax money in the hope that DFLers might take over the Minnesota Senate and increase the state gas tax. The state's unwillingness to increase the gas tax for roads and bridges has ramped up pressure on counties to do it for themselves.

Commissioner Mike Opat said that in an ideal world, the state would fund roads and bridges, the Southwest and Bottineau lines would already be running and that "we wouldn't have to have this conversation." But the reality is different, he said.

Construction on the Southwest line is moving ahead, but Bottineau's delay is indefinite. Thus the cash is accruing from the transportation sales tax and can't be shifted to other needs such as social services, another huge demand on county money.

Conversely, Callison said shifting some of the transportation tax from transit to roads frees up property tax revenue.

Joining Callison and Opat on the vote for the fund shift were Commissioners Irene Fernando and Jeff Johnson. Fernando was less enthusiastic than Johnson, a longtime devotee of roads.

In a written statement, Fernando said her vote was not a "decision point," meaning that she is reserving judgment until she sees the staff report — though she said she's interested in repairing the "dozens of aging bridges."

Almost half the state's 87 counties have imposed a local option sales tax for transportation projects. "They're just doing everything they can to keep up with their road and bridge needs," Donahoe said.