St. Paul, MN- The Metropolitan Council is facing a projected $89 million gap in its transportation operating budget over the next two years, reports the Star Tribune.
The regional planning body is hoping for supplemental funding from state lawmakers, rather than facing the prospect of increased user fees or cutbacks in service. Fares were last raised in 2008.
Met Council Chairman Adam Duininck told the Star Tribune the Council is hoping for a long-term source of revenue from the legislature. This may end up being a half-cent transit sales tax in the seven-county metro area. This is estimated to raise about $280 million a year, far more than the council’s current deficit.
About half, $43 million, of the deficit comes from a projected decline in motor-vehicle sales tax revenues through 2019. Currently there is a 6.5 percent sales tax on both used and new cars. Revenue trends are falling as people continue to hold onto their cars for longer periods of time rather than replacing them.
Motor-vehicle sales tax revenue currently brings in about $225 million annually for the council, around 44 percent of their 2016 budget. Transportation costs total about two-thirds of the council’s overall budget of $1 billion.
Another $24 million of the projected deficit comes from predicted increases in demand for the Metro Mobility bus service. This program serves elderly and disabled persons, and demand is likely to go up as baby boomers continue to age. This service is mandated by the federal government.
The Met Council may be further affected by the possible dissolution of the Transit Improvement Board. That board already levies a quarter-cent transit tax in Hennepin, Ramsey, Washington, Dakota, and Anoka counties. They also currently pay about half of the operating costs of the Green and Blue lines of the light-rail, and are expected to take on a third of the costs of the Southwest and Bottineau LRT projects. If that board is dissolved the Met Council may be forced to take on additional financial responsibilities for those projects.