History repeats itself in St. Paul; transportation funding stalls again

David Olson

Published Thursday, May 24, 2007

The Minnesota Chamber of Commerce today expressed tremendous disappointment that lawmakers once again failed to take the next meaningful step on transportation funding. At the same time, Chamber President David Olson pledged to immediately work to seek consensus on a package to present to the 2008 Legislature.

“It’s unfortunate, but the equation for continued gridlock was cast early in the session,” Olson said. “As inevitable as it is that potholes surface each spring in Minnesota, certain transportation proponents advocated an all-or-nothing approach to funding. It appears they have learned little from the last 20 years.”

The results were both predictable and unfortunate, Olson said. The House and Senate each passed mega-transportation bills that contained several tax and fee increases exceeding $1 billion annually – despite repeated warnings that Gov. Tim Pawlenty would veto the measures.

Even with the veto, there was ample opportunity to reach a compromise on transportation, Olson said. Some advocates, including the Association of Minnesota Counties, turned down a package brought forward by House Republicans. The package included the governor’s proposed $1.7 billion bonding program and $250 million in one-time money. Republicans also tried to present this offer on the House floor.

The Minnesota Chamber forwarded its own substantive – yet moderate – funding package that would have generated additional revenue of almost $500 million in FY 2008-09 and nearly $650 million in FY 2010-11 for roads, bridges and transit across the state. The package included a 5-cent increase in the gas tax, increase in license tab fees, dedication of the motor vehicle sales tax on leased vehicles to metro transit, and bonding to accelerate projects.

The package was rejected by certain transportation advocates who would not compromise on a package that could become law and still boost funding by a sizable amount, Olson said. As a result, motorists sit in Twin Cities traffic, and Minnesotans’ lives increasingly are put in jeopardy on unsafe rural highways.

“The only progress on transportation funding in the past two decades has been through an incremental approach,” Olson said. “Witness the broad-based coalition, led by the Minnesota Chamber, which achieved the first step in significant transportation funding through passage of the Transportation Amendment in November. This year, we proposed step 2, but, unfortunately, we were unsuccessful.”

On a positive note, the Legislature did enact in law the distribution of the motor vehicle sales tax proceeds - 60 percent to highways and 40 percent to public transit.

“Minnesota chambers of commerce across the state have made it clear that transportation funding is a critical issue facing this state,” Olson said. “They also understand that some progress is better than nothing at all. That’s our greatest disappointment with the legislative inaction. This session only strengthens our resolve to work with our members this summer and fall to present a meaningful and realistic package to the 2008 Legislature.”

David Olson is the president of the Minnesota Chamber.