Transportation Omnibus Bill: VETOED

Last year metro-DFL senators tanked the transportation bill with an amendment adding Southwest LRT funding in the final minutes of the session. But because the metro roads in particular have been starved, and congestion has been increased as a matter of state policy since 2010, with dollars going instead to light rail, there is enormous pressure to deliver a “roads” bill. Plus, politicians like delivering infrastructure dollars.  Thus, the GOP gave Dayton a bill they thought he could sign; it was vetoed anyway.

But the state has money for transportation from a 2015 bill which authorized about $5.5B in spending for FY16/17, plus dedicated funding sources and unspent bonding.

This begs the question: do we need a transportation bill? You decide.

There is a lot to like in terms of spending for roads, airports and freight. To pay for it, the bill reallocates certain motor vehicle sales tax revenues to fund priorities without raising taxes and taps general fund dollars. It requires MNDOT to find agency efficiencies of at least 15% to spend on trunk highways. In fact, it follows and improves on the Center’s 2015 Policy Blueprint. Electric cars, for example, are asked to pay $75 a year.

The bill includes bonding ($600 million trunk highway; $300 million Corridors of Commerce; $300 million for general state road construction). It eliminates funding for passenger rail (e.g. train to Duluth).

Here’s the big concession: metro counties are given the power to raise the local transit sales tax to half a cent to pay for building and operating transit without a referendum. Hennepin and Ramsey are expected do this soon. This means that counties no longer need state funds to expand LRT (but still need federal funds to build SWLRT and other lines). Fortunately, the Trump administration’s “skinny budget” does not fund any transit in Minnesota that was not already approved under Obama.

The Metropolitan Council is barred from issuing debt (“certificates of participation”). The Met Council does not care; Hennepin County will issue bonds instead, backed by $125 million in new revenue from the sales tax.

But if LRT is expanded as planned, operating costs are no longer covered by the state unless capital costs are first legislatively approved (current law obligates the state to pay 50% of operating costs for existing LRT).

Finally, the bill contains Met Council governance reform that takes appointments away from governor and allows counties and cities to appoint representatives. This plan was hammered out by county and cities leaders. If the same leaders are appointed to the Council, the broad scope of authority and abuse of power issues could be addressed but we prefer waiting for a new governor to break up the Met Council.