Minnesota Governor Mark Dayton Proposes Gas Tax

The tax would be a wholesale tax paid by fuel suppliers as has become more common in the last two years, not a retail tax at the gas pump. The Democratic governor's main problem may be his timing—the house flipped to Republican control.

2 minute read

January 2, 2015, 5:00 AM PST

By Irvin Dawid

"The plan calls for a 6.5 percent wholesale surtax on gasoline -- separate from the existing 28.5 cents-per-gallon tax already levied," writes David Montgomery, political reporter at the St. Paul Pioneer Press (PP). "That means the tax would bring in more money when gas prices increase" [and less when prices decrease.]

This is a huge reversal from 2013 when the Minnesota Democratic Farmer Labor Party (DFL) controlled both houses of the Minnesota State Legislature and DFL Gov. Mark Dayton rejected their 7.5-cent gallon tax increase, as noted in April, 2013. "Elections have consequences," as the saying goes.

The Republican fix for crumbling roads and structurally deficient bridges: "shift money from public transit to roads," writes Montgomery.

"My gosh, should we spend a billion on a train when we can't fill potholes?" said incoming House Speaker Kurt Daudt

"Daudt said a gas tax increase is 'incredibly unpopular'", reminiscent of what Dayton told the then-Democrat controlled House earlier:

The Democratic governor, who fears that a gas tax increase lacks popular approval, maintained his support for "raising sales taxes in the seven-county Twin Cities metro area for light-rail and bus transit", but the Democratic chairman of the House transportation committee canceled a meeting in which they would take up a bill authorizing the regional sales tax. [Planetizen 2013].

Dayton remains committed to "a half-percent increase in the sales tax in the seven-county metro area," writes Montgomery about the Twin Cities metro region, double what was proposed in 2013, with revenue devoted to public transit.

The collapse of the I-35W bridge over the Mississippi River in Minneapolis on August 1, 2007 may be a distant memory for the incoming speaker. The bridge failure, including the death of 13 people, may have inspired the legislature in 2008 to successfully override the third veto by then-Republican Gov. Tim Pawlenty which resulted in an incremental 7.5-cent gas tax increase.

Michigan Gov. Rick Snyder had proposed converting the fuel excise tax to a wholesale sales tax in the fall, but the legislature opted for a general sales tax increase ballot proposal instead. 

Hat tip to AASHTO Daily Transportation Update

Wednesday, December 31, 2014 in Pioneer Press

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