State Senate Democrats proposed a new fuel tax of 6.5 percent per gallon, along with a hike in license tab fees and a one-cent sales tax increase in the seven-county metropolitan area, as a way to raise about $800 million in additional state money every year to upgrade Minnesota's transportation system.
"This is a serious problem that requires a serious solution," said Sen. Susan Kent, DFL-Woodbury, who appeared with a handful of colleagues at a Monday morning news conference to unveil their plan. The Democrats, many of whom represent swing districts, acknowledged the political difficulty of a proposal that would demand more money from the pockets of every Minnesota driver.
"I can't think of another path," said Sen. Vicki Jensen, DFL-Owatonna. "I can't find another path" to raising the kind of money needed to repair and replace thousands of miles of crumbling roads, hundreds of aging bridges while also increasing road capacity with a few key projects.
The proposal, authored by Minneapolis DFL Sen. Scott Dibble, has as its centerpiece the sales tax on gas at the wholesale level of 6.5 percent a gallon. That would be on top of the existing 28.5-cents-per-gallon state gas tax, so drivers would definitely pay more at the pump.
That's identical to a proposal from Gov. Mark Dayton, who has identified a big transportation spending boost as one of his top priorities of the new legislative session. Dayton has also advocated a license tab fee increase and a metro sales tax.
Dayton and DFL senators have repeatedly cited the work of a transportation panel, convened by Dayton in 2012, that produced a report stating the state needs to raise about an additional $6 billion over 10 years in order to keep its roads and bridges in decent working order.
Republicans, who hold the House majority, have also called fixing roads and bridges a priority; but GOP lawmakers have been much more reluctant to sign on with tax increases. Last week, House Republicans proposed an additional $750 million in transportation funding in the next four years, a figure Dayton blasted as not nearly sufficient.
The DFL and GOP are also likely to square off over transit funding. The one-cent metro sales tax increase in the Senate plan would raise about $250 million in 2016, or an estimated $1.30 a week for the average metro resident.
A flashpoint could be the ongoing Southwest Light Rail project, which requires $121 million from the state in order to proceed. Dibble said he'd like to see that money come from the metro sales tax, which Dayton has already suggested. But Republicans, including House Speaker Kurt Daudt, have repeatedly emphasized their opposition to spending any state dollars on the project.
