DALLAS -- Minnesota Gov. Mark Dayton will propose a compromise transportation funding plan after Democratic and Republican lawmakers failed to agree last week on how to resolve a $10 billion highway and transit shortfall over the next 10 years.
"It would be a true compromise, involving things the House doesn't like and including things the Senate doesn't like," Dayton, a Democrat, said Friday. "It's going to be real money and it's going to be reliable and continuing over the next decade."
Democrats in the state Senate dropped a proposal last week to levy a sales tax on gasoline at the wholesale level that would raise the state's 28.5 cents per gallon tax on both gasoline and diesel by 16 cents to fund transportation projects. The lawmakers instead offered a 12 cent per gallon increase over three years.
The Democrat's funding plan also includes $1 billion of state highway revenue bonds to be issued over four years, and $567 million of state general obligation bonds for local road and bridge projects.
Sen. Scott Dibble, a Democrat from Minneapolis who chairs the state Senate's transportation committee, said motorists would see the benefits of raising the gasoline tax in better roads and safer bridges.
"It's never popular at the outset," Dibble said. "It [raising the gasoline tax] takes some courage. But once we take that step, we see that people really support those investments."
House Republicans said they would not support an increase in the gasoline tax.
"Minnesotans have made it very clear that they want transportation improvements but do not want to pay higher gasoline taxes, and House Republicans fully support their position," said state Rep. Dave Hancock, a Republican from Bemidji. "I'm glad the governor is engaged in finding a long-term road and bridge funding solution, but he has to accept that any increase to the gas tax will not gain approval in the Minnesota House, and he needs to act accordingly."
Republicans hold the House, with 73 of the 134 seats. The Democratic-Farm-Labor Party controls the Senate with 39 of the 67 seats. Dayton is a Democrat.
The Minnesota Department of Transportation said the state is facing a $16.3 billion transportation shortfall through 2035. More than 40% of Minnesota's roads would be past their useful service life within the next 10 years at the current funding level, it said.
The 2016 session ends May 23.
House Speaker Kurt Daudt, a Republican from Zimmerman, said the Republicans stand behind their proposal to fund road and bridge projects with existing resources.
"We feel like we're the ones here representing middle-class Minnesotans and protecting them from government just taking more money from them to pay for things that we already have the money to pay for," Daudt said at a news conference on Friday. "Ours is what we think is a very logical position and we think it's where Minnesotans are at."
The proposed Republican transportation program would generate $7 billion over 10 years without an increase in the state gasoline tax, Daudt said.
The House Republican proposal includes $2 billion of new debt for state and local transportation projects. The plan also would allocate $300 million from a projected $900 million state surplus in fiscal 2017 to transportation.
House Republicans are reluctant to compromise with Democrats on transportation funding, said House Minority Leader Paul Thissen.
"The speaker continues to say he's not going to draw any lines in the sand, and then he steps up and draws lines in the sand," Thissen said.
