Gas tax no longer enough: Lawmakers explore alternative ways to pay for needed roadwork
Federal, state and county leaders are looking into new ways to pay for road maintenance and repairs.
With the gas tax failing to provide enough funds to cover these costs, additional sources of revenue are being considered, such as general obligation bonds or increased license tax fees.
Raising the current gas tax is also an option on the table.
The funding challenge was a topic of conversation at last week's meeting of the Otter Tail County Board.
In a presentation to the board, Margaret Donahue, the executive director of Transportation Alliance, said, "There's a gap in roadway needs and the funding that's needed to pay for those projects. We're talking about billions of additional dollars that will be needed over the next 20 years."
Transportation Alliance is a statewide coalition of organizations advocating for a safe and effective transportation system that works for all Minnesotans.
Otter Tail County Engineer Rick West said it will be necessary to focus on various funding options just to maintain the county's roads and bridges - not to mention needed repairs for long-term use.
The county highway department has under its jurisdiction 1,052 miles of highway and 142 bridges. The annual department budget is approximately $12 million.
Current revenue sources include local, state and federal funds.
"Townships have mostly gravel roads, and even those are hard to maintain, due to limitations with available financial resources," said West.
To that end, Donahue said a Transportation Advisory Committee is in place in Minnesota.
"Several proposals are being debated," said Donahue, "including an increase in license tax fees to help raise money for road and bridge repair. Others also see a need of raising the state gasoline tax."
The Minnesota gas tax is 28.5 cents per gallon and the federal gas tax stands at 18.4 cents per gallon. The federal tax hasn't been raised in nearly two decades.
Donahue said the National Commission on Fiscal Responsibility and Reform recommended an increase in the federal gas tax in order to garner funding for road and bridge projects in areas such as Otter Tail County. The proposal calls for increasing transportation revenues until the transportation trust fund is fully funded. This includes a possible gas tax hike starting at 15 cents.
Lawmakers are also tossing around the idea of implementing general obligation bonds to help fund roadway projects. That, however, does not sit well with some, who say it would only kick the can down the road.
"I prefer to raise money for roadway projects in real time," said county commissioner Doug Huebsch, who represents the Perham area, "rather than to push this problem out and into the future."