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A Perfect Storm of Transportation Appeals

February 13, 2014 By Conrad deFiebre, Transportation Fellow

In my six-plus years as MN2020's transportation fellow, I've seen lots of urgent appeals for more money for roads, bridges, transit and alternative modes -- but never as many as right now. I've lodged a few myself, starting with a January 2008  report on the economic benefits of such investments.

The time was more than ripe back then. Minnesota was still reeling from the deadly collapse of the Interstate Hwy. 35W bridge in Minneapolis, the state's fuel tax dedicated to highways hadn't been raised in nearly 20 years and Gov. Tim Pawlenty had vetoed two previous bipartisan attempts to restore its buying power. He claimed, defying all evidence, that it would hurt our economy.

In February of that year, with the Minnesota Chamber of Commerce finally on board, legislators, including a handful of courageous conservatives who got blackballed by their fellow-travelers for their trouble, overrode Pawlenty's third veto. The new revenue focused on transit and a nation-leading program of repairing and replacing creaky bridges.

I'd like to take credit for this happy outcome, but my arguments probably wielded only a tiny effect. Since then, I've been skeptical of continuing calls for more highway funding, arguing that most of Minnesota's 140,000-mile system of roadways and bridges is so mature that there's little economic return to be reaped from expanding it further. Mature systems need maintenance, however, which has been falling behind as we keep building on, a foolish and un-conservative way to treat our public assets.

What we do need, in addition to better upkeep, is targeted expansion of Greater Minnesota's busiest two-lane highways to enhance safety and freight mobility. Meanwhile, we should step up investment in transit, bicycling and walking, long-neglected modes that offer affordable, healthy and environmentally friendly choices while easing pressure on crowded urban highways more effectively than adding lanes.

These musings were prompted by a recent spate of the most widespread calls for transportation investment in my memory. They're coming from national, state, county and local quarters, even from conservatives such as U.S. House Transportation Chairman Bill Shuster. Interestingly, this perfect storm of transportation advocacy is occuring in a general election year, usually considered the worst time possible to increase highly visible user fees that many, of not most, voters detest.

Clearly, it will take some new profiles in courage among elected leaders to translate all the talk into action. I won't lay odds on the results, but here's a rundown of the many voices and proposals out there:

 NATIONAL SCENE

It's been more than 20 years since the last bump in the federal fuel levies of 18.4 cents a gallon for gasoline and 24.4 cents for diesel. Meanwhile, new projections from the nonpartisan Congressional Budget Office show that the Highway Trust Fund fed by the pump taxes will run dry before the current two-year federal transportation law expires Sept. 30. Most of the money supports highways and bridges, with about one-fifth going to transit and non-motorized modes, a formula enacted by President Reagan. While hardly anyone, President Obama included, is openly calling for an increase, other revenue ideas are on the table.

Rep. Shuster of Pennsylvania has endorsed a vehicle-miles traveled fee and expressed openness to higher taxes on energy exploration and Obama's proposal to use a lowered tax on repatriated foreign corporate profits now being kept overseas. Shuster, however, will have to face down Tea Partiers on his side of the aisle who'd rather get Washington out of the transportation business entirely.

That's a bad idea that's gained currency from Congress' swearing off of earmarks, whose small cost for log-rolling did much to loosen legislative gridlock in years past. But total devolution of transportation to the states is not much worse than Obama's plan, which would further sever the economic connection between motorists and the public infrastructure they use. Non-user subsidies for driving are already at an all-time high in the United States, while in most of Europe, drivers subsidize other government functions via user taxes.

We don't need to exacerbate this trend, which lavishes goodies on the way most people choose to get around anyway. On top of that, it actually makes traffic worse. As noted in a new edition of a report titled The Innovative DOT, "when users do not see appropriate price signals, demand is artificially increased, resulting in more congestion and pressure for new capacity."

Former Transportation Secretary Ray LaHood, fresh from Obama's Cabinet after a long career as a Republican congressman, proposed a dime increase in the federal fuel taxes. And five ex-transportation secretaries under GOP presidents, plus one of Bill Clinton's, urged Obama to exert "strong and sustained" leadership to "break the impasse" on transportation funding. They offered no specifics, but called for "a 21st century funding model" to replace fuel taxes that are "no longer sufficient." 

The secretaries emphasized transportation excellence as "a driver of job creation, ... economic growth and global competitiveness."  Seventeen state governors, including our own Mark Dayton, signed an open letter to congressional leaders making the same case.

 MINNESOTA SCENE

Unlike any Minnesota transportation commissioner in decades, Charles Zelle has tirelessly promoted additional revenue, barnstorming the state to point out a $12 billion state highway funding gap and even subjecting himself to grilling by the wonks of the Civic Caucus. Zelle on the state fuel tax, which last year got the last of the phased rate hikes enacted in 2008: "It's inadequate, it's diminishing, it's not indexed and it's inefficient, because cars are getting more fuel-efficient and vehicle miles are not going up."

He's been backed by a chorus of many voices, including the mayors of Minneapolis and St. Paul, commissioners of more than 70 of the state's 87 counties and advocacy groups such as the Minnesota Transportation Coalition. Even Transit for Livable Communities has chimed into the push for "transit, roads, bridges, bicycling and walking."

TLC has signed on with Move MN, a broad coalition that also gathered endorsements from counties across the state but, conspicuously, not from Anoka, Hennepin, Scott or Washington. But new Minneapolis Mayor Betsy Hodges has taken up the cause for the state's largest metropolis. Along with St. Paul's Chris Coleman, she's calling for a half-cent metro sales tax increase to finance transit and roads.

For all transportation needs in Minnesota, not just the 12,000-mile trunk highway system, the projected funding shortfall over 20 years is $50 billion. That's a lot to swallow in one sitting, but it wouldn't hurt to nibble away at it, elections looming or not.

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2 Comments:

  • David Schmidt says:

    February 13, 2014 at 5:20 pm

    This is a tricky one. To connect additional transportation funding directly to user costs via gas taxes, per mile taxes, raising public transit fares, increase auto taxes, tolls, etc. will eventually hurt the middle and lower classes. These two classes, some argue, are already over taxed and to raise those transportation costs will result in money taken from elsewhere [such as kids summer activity fees or updating the furniture in the home]. On the other side of the coin, you could continue to subsidize via indirect taxes [ sales tax: the never ending government feed trough].

  • William Short says:

    February 14, 2014 at 10:32 am

    Please don’t use this cliche anymore, “...perfect storm”,  what ever that may mean.  To you.  To anyone.
    It is also used as excuse in press, as “...it was a perfect storm.  Who could have known”, etc.

    And thank you,

    Will Short
    Minneapolis, MN