The 150 member Move MN coalition says the balanced, sustainable package will address the state’s significant transportation needs and bolster economic competitiveness
St. Paul, Minn. – The state’s economic progress is at risk of being derailed by billions of dollars in unfunded transportation needs according to Move MN, a statewide coalition of more than 150 organizations advocating for making transportation an urgent funding priority this legislative session. Today, the group unveiled a transportation funding package it says will fund critical projects in a balanced, sustainable and equitable way.
“Minnesota is falling out of medal contention on transportation. We’re not taking care of what we have—roads and bridges—and we’re not adapting fast enough to meet growing demand for transit, bicycling and walking options,” said Barb Thoman, executive director, Transit for Livable Communities. “Last year, 10 states passed comprehensive transportation funding with bipartisan support—including Virginia, Nevada, and Wyoming. The Move MN proposal is about making sure our businesses and our working families have a shot at success.”
The package was unveiled during a joint meeting of the House and Senate transportation committees. Representatives from Move MN presented details about its funding recommendations while citizens from around the state testified to underscore the urgency of passing a package in 2014.
“With each passing year, our state’s economic competitiveness is diminished as critical transportation projects go unfunded,” said Margaret Donahoe, executive director of the Minnesota Transportation Alliance. “We’ve heard from every part of the state that transportation is the number one issue impacting the ability of everyday Minnesotans to get to work and to school, or for businesses and farmers to get products to market. What we’ve put forward is a sustainable transportation funding package that recognizes that this is a statewide need, and that we are all in this together.”
A Move MN Transportation Funding Package
In order to address the inadequacies of our current system and realize the progressive system of the future, Move MN proposes that any new funding for transportation must meet these core principles:
· Any transportation funding package must be comprehensive to address, roads, bridges, transit and bike and pedestrian infrastructure.
· Any transportation funding package must equitably balance the transportation needs of Greater Minnesota and the metro, Minneapolis-St. Paul and the suburbs, and the east and west metro.
· Any transportation funding package must be a long-term, sustainable funding solution and ensure that funding is dedicated to transportation.
In accordance with these principles, Move MN announced its support for a package that includes the following:
Greater Accountability and Transparency in Transportation
Move MN is committed to making sure there is greater efficiency and transparency with transportation projects, in addition to finding new funding sources that meet long-term obligations for all modes.
Close the leased vehicle sales tax loophole
In 2006, Minnesota voters overwhelmingly supported a constitutional amendment to dedicate the existing motor vehicle sales tax to transportation. Unfortunately, the constitutional amendment did not dedicate sales tax revenue from leased vehicles to transportation. In 2008, the legislature attempted to close the loophole but only a portion of the tax was dedicated to transportation and the other portion to the general fund.
Minnesota’s current budget surplus provides a unique opportunity to finally close the leased vehicle sales tax loophole and make critical investments in transportation. Move MN proposes dedicating all of the leased vehicle sales tax to highway and Greater Minnesota transit funding. Doing so would provide $32 million in new transportation funding without raising one penny in new taxes.
One Cent for Transit and Bike-Pedestrian Infrastructure
The ¼ cent metro sales tax has helped build the new Green Line (Central Corridor) and the new Newport Transit Station, and fund the cost of operating the region’s transitways. The current sales tax is not enough to build the transit system our region needs. Move MN proposes increasing the current sales tax by ¾ cent, applying the sales tax in all seven counties and using a small portion of the tax to fund safe and accessible bike and pedestrian connections in the metro. The seven-county sales tax for transit would become one cent and generate $335 million in new revenue annually.
The additional transit funding would complete the current Met Council transit plan within 15 years, bringing new LRT and rapid bus lines across the entire region. The new funding also would mean increases in the Metro Transit and suburban transit bus systems, as well as a wider network of bikeway and pedestrian connections.
New sales tax on wholesale fuel
Move MN proposes a new 5 percent sales tax on wholesale fuel. Unlike the per-gallon fuel tax, the wholesale fuel sales tax, also known as gross receipts, will generate additional transportation funding as the price of fuel increases. Minnesota’s current gas tax would remain the same. The new sales tax would be administered at the wholesale level and is projected to raise more than $360 million annually in new transportation funding.
The wholesale fuel sales tax also ensures transportation funding keeps up with the cost of inflation. The cost of road and bridge construction in Minnesota is higher than the national average. In fact, construction costs have increased by 70 percent since 2004.
Minnesota would join a growing number of states that have a sales tax on fuel, including Virginia and Pennsylvania that both passed a sales tax in an election year. Today, nearly 20 states have a sales tax on fuel or a tax on fuel suppliers.
Allocating existing flexible federal funding for Greater MN bike-pedestrian infrastructure
Like the leased vehicle sales tax, the Minnesota legislature can allocate existing funding to meet our changing transportation needs. According to a statewide poll, more than 90 percent of Minnesotans believe future transportation projects should integrate biking and pedestrian connections with highway and transit projects.
There is substantial need in Greater Minnesota for safer and more accessible bike and pedestrian infrastructure. More than 70 communities around Minnesota are nearing completion of their Safe Routes to Schools (SRTS) plans and another 40 communities are just kicking off their SRTS planning process. Likewise, more than 50 Greater Minnesota communities have expressed interest in MnDOT’s Main Street Enhancement Projects. The state can expect that this local work will lead to more demand for infrastructure investments.
In addition, it’s proven that construction of pedestrian and bicycling infrastructure creates jobs. In fact, for each $1 million in bicycling or pedestrian infrastructure, 10-11 non-construction related jobs are created.
By allocating $16 million in the flexible federal funding from the Surface Transportation Program that MnDOT receives each year, we can afford to invest in bike and pedestrian infrastructure throughout the state. This infrastructure is closely tied to our state’s economic competitiveness and quality of life. Bike and pedestrian connections make our communities healthy, vibrant and livable, which in turn attracts businesses and talent and safely connects our families to their destinations.