Is a Gas Tax Increase Coming in 2016?

Despite saying late last year that a gas tax increase would not happen, Governor Mark Dayton seems to be reconsidering.  According to an MPR report, Dayton stated at a Friday news conference that “legislative proposals have second lives,” and continued by arguing that it is irresponsible to fund transportation projects without an ongoing transportation revenue source.

According to the November Minnesota Department of Transportation Financial Snapshot, the state made $31.2 million in revenue from the current gas tax for the 2015 fiscal year. As Alpha News reported last year, Dayton has proposed a 6.5% wholesale gas tax increase.

Though Dayton believes creating an ongoing source of revenue is the responsible thing to do for the funding of transportation projects, most Republicans disagree. When asked to comment on Dayton’s recent statements, State Senate Minority Whip David Osmek (R) made it clear that he vehemently disagrees with Dayton’s position, stating, “Minnesotans are tired of his brand of Saint Paul Double Talk,” and that “We certainly can use some of this surplus to fix our roads and bridges, without the need for more taxes.”

When Alpha News inquired as to how State Senator Paul Gazelka (R) felt about Dayton’s comments, Gazelka asserted, “Let’s focus on tax relief, not tax increases.”

According to MinnPost, the gas tax would likely be paired with a metro wide sales tax to fund the Southwest Light Rail Service (LRT). The LRT is currently in its planning phase, but heavy construction is expected to begin in 2017. According to the Metropolitan Council’s website, the projected cost for the LRT is an astounding $1.77 billion and will be paid for via a combination of local, state, and federal funds.

The Minnesota Republican Party has made it clear that they have no intentions of raising the gas tax and are not especially fond of light rail transportation funding given the current state of Minnesota bridges, roads, etc. Osmek argues that the state should “invest money wisely on an improved bus system, and out-state services people actually want.”

One of the major legislative issues on the docket for the 2016 legislative session is passing a comprehensive transportation bill. A battle between the DFL and GOP over the controversial gas tax increase could make doing so more complicated. The fight over transportation funding introduces Minnesotans to a larger issue: rural vs. urban funding.

Time will tell as to whether or not the revived gas tax increase will pass both state legislative chambers and be signed by Governor Dayton during the upcoming session. One thing is certain though, both choosing to increase the gas tax or not to will have consequences for Minnesotans and Minnesota’s economic future.

Blake Kraussel