Governor Dayton Details Plan to Fix Minnesota’s Aging, Underfunded Transportation System

Comprehensive proposal would fund roads, bridges and transit across Minnesota, and create 119,000 new jobs

For years, state leaders have failed to adequately fund Minnesota’s highways, roads, bridges, and public transit systems. Insufficient funding has left them inadequate, congested, and needing repairs.

On January 26, 2015, Governor Mark Dayton proposed a straightforward, honest solution to fix Minnesota’s aging transportation systems. Governor Dayton’s plan would invest $6 billion over the next ten years to address the state’s highway funding deficit, invest $2.356 billion in local government transportation projects, and provide $2.92 billion for Metro and Greater Minnesota transit systems. The Governor’s proposal would create an estimated 119,000 new jobs,* and build the infrastructure necessary to meet the demands of a growing population and an expanding state economy.

“Inadequate transportation clogs our lives with worse traffic congestion, longer commutes, more dangerous travel conditions. Those deficiencies restrict our future economic growth and detract from our quality of life,” said Governor Dayton. “If we continue to avoid these problems, they will only get worse. It’s time to begin to solve them. I urge the Legislature to work with me this session to begin to repair and improve Minnesota’s transportation systems.”

“Minnesota’s roads, bridges, and transit networks form the backbone of our economy. After decades of decline, we must invest in these systems to protect Minnesota’s long-term economic vitality,” said Lt. Governor Tina Smith. “The plan that Governor Dayton and I are proposing would provide the resources we need to build a modern transportation system – driving continued business and job growth, and protecting the quality of life enjoyed by all Minnesotans.”

The problem is real. In 2012, Governor Dayton convened a bipartisan panel of experts – including policymakers, business and labor leaders, Cabinet officials, and city and county officials from across the state – to study the funding needs of Minnesota’s highways, roads, bridges, and public transit systems. The Transportation Finance Advisory Committee’s (TFAC) analysis concluded that Minnesota faces a $6 billion state highway transportation funding deficit over the next ten years to preserve our existing system, and make the improvements needed for our long-term prosperity. Facing a large and growing list of transportation needs, declining revenues, and an expected one million new residents over the next 25 years, the need for a major new investment in transportation is clear.

“The state’s foremost experts agree on two things: this problem is real, and it cannot be resolved without a major investment,” said MnDOT Commissioner Charlie Zelle. “But Minnesotans didn’t need a bipartisan panel of experts to tell them what they already know – that our transportation system is in serious disrepair, and getting worse. This problem presents us with two simple and starkly different options: invest for the future, or do nothing and let the problem get much worse. We choose to invest.”

Governor Dayton’s Plan: What It Buys
Governor Dayton’s transportation plan would allow for significant improvements to roads, bridges, and transit systems statewide. Right now, more than half of Minnesota’s roads are more than 50 years old, and 40 percent of the state’s bridges are more than 40 years old. In just the next three years alone, one in five Minnesota roads will pass their useful life. And in the next ten years, nearly 40 percent of our roads will be past their useful life.

With new funding proposed by Governor Dayton, the state can make needed repairs and new investments in our transportation and transit systems – ensuring that Minnesotans are driving on safe, reliable roads and bridges, and have better access to a variety of low-cost transit options. Those improvements would include:

Better Roads and Bridges. The Governor’s plan would repair or replace 2,200 miles of state roads. It would repair or replace 330 bridges statewide. Forty percent of the new revenues raised in the Governor’s proposal would be directed to cities, counties, and townships; giving local leaders the resources and flexibility to repair and replace local roads and bridges statewide.

Better Transit Across Minnesota. The Governor’s plan would fund 20 new transitways, increase metro area bus service by 27 percent, increase Metro Area transit ridership by an estimated 80 percent, meet 90 percent of all transit needs in Greater Minnesota, and increase transit service in Greater Minnesota by nearly 500,000 hours of service each year.

More Corridors of Commerce. The Governor’s plan would provide an additional $1.6 billion for the Corridors of Commerce initiative, making targeted investments in key freight routes that are important for businesses’ expansions and economic development.

“By 2040, Minnesota’s population is expected to grow by over 1 million people; 800,000 of them will live in the Twin Cities Metro Area,” said Metropolitan Council Chair Adam Duininck. “For the future livability of our region, and for the competitive benefit of our entire state’s economy, we need to invest today in expanding and improving our transit systems. The future of our state, and our ability to leverage the federal funding needed to build a modern transit system, depends on the wise and necessary investments we make today.”

Governor Dayton’s Plan: How it Works
The Governor’s transportation plan would bridge the $6 billion state highway transportation funding gap over the next ten years by raising new dedicated revenues for roads and bridges. It would also increase revenues for transit.

New funding for road and bridge construction would be provided by a 6.5 percent gross receipts tax on gasoline, raising the current 1.25 percent base tax on vehicle registration fees to 1.5 percent, and raising car registration fees by $10. The Governor’s plan would also require MnDOT to generate efficiencies of 15 percent from all new revenues, allowing the Department to do $6 billion of work for $5.38 billion in new funding.

The chart below describes how new revenues would be used to address Minnesota’s transportation needs.

Road and Bridge Funding Over 10 years

State Funding (Trunk Highway) – $5.38 billion
$3.38 billion in new revenue
$2 billion in trunk highway bondsSource : Gross Receipts Tax and Registration Fee
County, City, & Township Funding – $2.356  billion
Direct funding to Counties – $1.58 billion
Direct funding to Cities – $490 million
MNDOT funding for Counties and Cities – $153 million
Townships – $133 millionSource : Gross Receipts Tax and Registration Fees

Transit Funding Over 10 years

Twin Cities Metro Area – $ 2.8 billion
Source : ½ cent sales tax increase in 7-county Metro
Greater Minnesota Transit – $120 million
Source : General Fund

Bike and Pedestrian Funding Over 10 years

Bike and Pedestrian Infrastructure/Safe Routes to Schools – $ 75 million
Sources : General Fund and ½ cent sales tax increase in 7-county Metro

*Job creation estimates for road and bridge improvements are calculated using a Federal Highway Administration fomula of 9,500 construction jobs and 4,300 construction support jobs created by each $1 billion in transportation investments. Job creation estimates for transit improvements are calculated based on the Metropolitan Council’s experience in building the Green Line (Central Corridor) LRT project.

Additional Information:

FACT SHEET: Governor Dayton’s Transportation Plan
FACT SHEET: Investing in Roads, Bridges, and Transit
SNAPSHOT: Investing in Roads and Bridges
MAPS: Transportation Projects