MN Republicans plan to raise $7B without gas tax

Republican leaders are a backing plan to raise $7 billion for the state’s transportation system over the next 10 years without raising the gas tax.

At a press conference Monday morning at the state Capitol, House Speaker Kurt Daudt and other Republican transportation leaders announced their plan to repair and replace 15,500 miles of roads and 330 bridges statewide by “re-aligning” existing tax revenue toward transportation, bonding and general fund money. The bulk of the money would go to roads and bridges, with $164 million to Metro Transit capital improvements.

Daudt, R-Crown, touted the plan as one that “sides with Minnesotans” in contrast to the governor’s DFL leadership proposal for a new 6.5 sales tax on wholesale fuel that would add at least 16 cents per gallon at the pump. Gov. Mark Dayton’s plan would raise nearly $11 billion over the next 10 years.

“What Republicans have heard Minnesotans say is that they don’t want a gas tax,” Daudt said Monday. “Remember that Minnesota’s economy is doing well because the gas prices have been so low in Minnesota. So we know that leaving money in Minnesotans’ pockets has been good for Minnesota’s economy.”

The $7.01 billion proposal breaks down to:

• $4.03 billion for state roads
• $1.44 billion for county roads
• $583 million for municipal roads
• $139 million for Greater Minnesota bus service
• $60 million for township roads and bridges
• $164 million for Metro Transit capital improvements
• $282 million for small cities under 5,000 people

Republicans plan to create a new fund, called the Transportation Stability Fund, to collect existing transportation-related tax revenue and dedicate them to five different transportation funding accounts. The new fund of about $3.08 billion includes revenue from sales taxes on auto parts and vehicle rentals as well as revenue from the existing rental vehicle tax and motor vehicle lease sales tax.

Beyond the Transportation Stability Fund, the plan includes $1.3 billion in trunk highway bonds, $1.2 billion from the Minnesota Department of Transportation, $1.05 billion in general obligation bonds and $228 million from the general fund