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Group urges Dayton to raise gas tax, tab fees

Published 3:58pm Saturday, December 1, 2012

Governor has yet to review proposal

ST. PAUL  — Gov. Mark Dayton’s own transportation advisory panel called Friday for a higher state gas tax and other fees and taxes to raise at least $50 billion more for roads and transit over the coming two decades.

The Transportation Finance Advisory Committee’s recommendations aim to improve the state’s roads and expand transit, including new light rail lines, as a boost to the state’s economy. Dayton created the group in January, saying a deteriorating transportation system was hurting economic growth.

Dayton spokesman Katharine Tinucci said the governor has yet to review the recommendations.

The report comes as the Democratic governor is preparing to unveil a tax overhaul after pushing for years to raise income taxes on top earners. It’s unclear how the array of transportation taxes will fit into his plan. Democrats will take over both houses of the Minnesota Legislature in January, creating an opening for tax increases after years of Republican resistance.

“My sense is the governor would very, very much like to get us back in a posture of making these needed and key investments,” said Sen. Scott Dibble, a Minneapolis Democrat who served on the advisory committee and will head the Senate Transportation and Public Safety Division.

The recommendations include two ways to raise $15.2 billion through a higher gas tax — an upfront hike of 10 cents per gallon followed by annual 1.5-cent increases for 19 years, or a series of 3.5-cent increases over five years with 1.5-cent increases for 15 years afterward. The state gas tax currently sits at 28.5 cents per gallon, including a 3.5-cent surcharge.

Another $4 billion for transit would come from increasing the sales tax in five Twin Cities counties by a half percentage point, or a nickel on a $10 purchase. Raising vehicle license tab fees roughly 10 percent would bring in another $1.1 billion. Drivers are required to purchase the tabs and stick them on their license plates every year.

The group is also eyeing other sources of money, including leased vehicle sales taxes that currently go into the state’s general treasury, county wheelage taxes and an expanded MnPASS toll lane system. A wheelage tax is an annual charge per vehicle.

The 19-member group led by Transportation Commissioner Tom Sorel picked the costliest of three options it studied.


  1. Scott Bute

    This is exactly what you get when you put the Democrats in charge. How about creating more jobs and a climate for buisnesses to thrive so we can have more paychecks instead of welfare checks? The D’s will get everything they want because they now have the burden of total control. To whom much is given much will be expected. I for one don’t expect much.

  2. Randy Kruckeberg

    Who whould have thunk democracts raising taxes say it isn’t so…..

    Let’s double down on state sponsored failure let’s have more light rail how else can the state steal private property by force, then call it an investment to make it sound good, run it at a loss along with the other lines that are non self sustainable, while telling everybody it’s “green” that is soooo european.

    The govenor and DFL need to payoff the supporters at the taxpayer expense so I guess the old saying is true, a fool and his money are soon parted with the help of the DFL.

  3. Dustin Petersen

    And how much money will they LOSE by having people who live near border states buy their gas across the border? Iowa is less than 15 minutes away and has lower gas tax than Minnesota.

    This will hurt gas stations in towns near neighboring states. We already have much higher gas taxes than Iowa. If they go much higher it WILL be cost-effective to drive across the border to fill our tanks.

  4. travis quam

    so what exactly did pawlenty do for our state? Scott, Randy, Dustin, ? tell me what he did. not raise taxes? oh yea, he started imposing fees on everything and didn’t address any road issues. what do you suppose the answer is then guys? throw out some suggestions. this is a way that everyone pays into, not targeting one income class.

  5. Scott Bute

    The income class that will get hit the hardest is the poor and working class. Robin Brown voted to raise the gas tax to fix our roads and bridges when she was in office so what happened to that money? Our state budget has increased from in the 20 billion dollar range when Ventura was in office to close to 38 billion now, not that many years later. We are being suckered by these spendaholics in government who will never have enough no matter what we are forced to give them. Thank God for Pawlenty and his very busy veto pen or it would have been even worse!