Millions of dollars for roads, transit are riding on constitutional change

12/26/2005

A campaign plans to spend at least $3 million to persuade voters to spend all the taxes from car and truck sales on transportation needs.

Laurie Blake,
Star Tribune
Last update: December 25, 2005 at 9:32 PM

Next year will be a pivotal one for transportation in Minnesota: Voters will decide whether to amend the state Constitution to guarantee more money for roads and transit.

A statewide coalition of business leaders, road builders, transit advocates and environmentalists is planning a $3 million to $4 million campaign to sell the idea.

Voters will be asked whether all taxes collected from car and truck sales should be spent on roads and transit, just as gas tax revenues and license tab fees are. Currently vehicle sales taxes are split about 50-50 between transportation and other needs.

Approval of the change is not a slam dunk. Constitutional amendments in general are difficult to pass. The wording of this one is controversial and may yet be changed by legislators. And transportation funding may not be easily understood by voters.

For all these reasons, the Minnesota Chamber of Commerce and a broad coalition of other groups are planning a yes-vote campaign directed by a local and national public relations team. Jon Campbell, chief executive of Wells Fargo Bank Minnesota, and Lenny Pippin, president of Schwan Food Co., will lead the campaign and direct fundraising.

A message in the vote

The private groups, which share a desire for better roads and improved transit, have joined the campaign because if the amendment fails to pass, legislators may get the message that people don’t want to spend more for roads and transit, said Carolyn Jones, director of transportation policy for the Minnesota Chamber.

“If this doesn’t pass, it’s going to be that much harder over the next five years to get any money for transportation,” Jones said.

It has been 17 years since lawmakers last raised the gas tax to its current 20 cents.

Because of that, the state is now $750 million to $1.25 billion a year short of what’s needed for the improvements necessary to keep up with population growth, increasing travel and worsening traffic congestion, according to the Minnesota Department of Transportation and other groups that have studied the funding gap.

The constitutional change would provide about $300 million more a year—about a third of that need.

While not the total solution, that’s real money that is long overdue, Jones said. An extra $300 million a year is the equivalent of a 9.5-cent increase in the gas tax, she said.

For state highways, that would be an extra $106 million in the 2012 fiscal year-- an increase of about 12 percent over what is expected from gas taxes, registration fees and the existing share of motor vehicle taxes, said Bob McFarlin, assistant to the commissioner of transportation.

Wording is controversial

The complex wording of the proposed amendment has raised opposition to the provision. It asks:

“Shall the Minnesota Constitution be amended to dedicate revenue from a tax on the sale of new and used motor vehicles over a five-year period, so that after June 30, 2011, all of the revenue is dedicated at least 40 percent for public transit assistance and not more than 60 percent for highway purposes?

Some legislators are planning to try to clarify it in the 2006 legislative session, said Rep. Mary Liz Holberg, R-Lakeville, and the chairwoman of the House Transportation Finance Committee.

What’s needed is a clear description of how the money would be spent, Holberg said. “We have to give people who want more money for roads something to vote for that’s guaranteed.”

The Coalition of Greater Minnesota Cities opposes the amendment as written. “We are looking at changing the wording so that 60 percent is dedicated to highway funding and 40 percent is dedicated to transit,” said Pat Hentges, Mankato city manager.

Holberg said she also expects opposition to the amendment from groups that want to keep motor vehicle sales taxes in the general fund to pay for education, health care and other needs.

The advocacy campaign will begin in early January with the announcement of the firm selected to lead it, Jones said. The initial focus will be on finding a way to make the issue meaningful to people, she said.

“I don’t expect it to be easy. It’s an issue that most people don’t know about. Their understanding of how transportation is funded is so low that we are going to have to do a significant effort in educating the public.”