Group Urges Dayton to Raise Gas Tax, Tab Fees
Gov. Mark Dayton's own transportation advisory panel called Friday for a higher state gas tax and other fees and taxes to raise at least $50 billion more for roads and transit over the coming two decades.
The Transportation Finance Advisory Committee's recommendations aim to improve the state's roads and expand transit, including new light rail lines, as a boost to the state's economy. Dayton created the group in January, saying a deteriorating transportation system was hurting economic growth.
Dayton spokesman Katharine Tinucci said the governor has yet to review the recommendations.
The report comes as the Democratic governor is preparing to unveil a tax overhaul after pushing for years to raise income taxes on top earners. It's unclear how the array of transportation taxes will fit into his plan. Democrats will take over both houses of the Minnesota Legislature in January, creating an opening for tax increases after years of Republican resistance.
"My sense is the governor would very, very much like to get us back in a posture of making these needed and key investments," said Sen. Scott Dibble, a Minneapolis Democrat who served on the advisory committee and will head the Senate Transportation and Public Safety Division.
The recommendations include two ways to raise $15.2 billion through a higher gas tax - an upfront hike of 10 cents per gallon followed by annual 1.5-cent increases for 19 years, or a series of 3.5-cent increases over five years with 1.5-cent increases for 15 years afterward. The state gas tax currently sits at 28.5 cents per gallon, including a 3.5-cent surcharge.
Another $4 billion for transit would come from increasing the sales tax in five Twin Cities counties by a half percentage point, or a nickel on a $10 purchase. Raising vehicle license tab fees roughly 10 percent would bring in another $1.1 billion. Drivers are required to purchase the tabs and stick them on their license plates every year.
The group is also eyeing other sources of money, including leased vehicle sales taxes that currently go into the state's general treasury, county wheelage taxes and an expanded MnPASS toll lane system. A wheelage tax is an annual charge per vehicle.
The 19-member group led by Transportation Commissioner Tom Sorel picked the costliest of three options it studied.
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