Transportation bill may be doomed by fight over taxes

With a week left to go in Minnesota's legislative session, the prospects for a major transportation funding plan may be dimming.

On Monday, Senate Majority Leader Tom Bakk said he's willing to drop his push for a transportation funding bill that relies on a gas tax and a sales tax throughout the Twin-Cities metro area.

But Bakk, DFL-Cook, said he would only step away from his focus on transportation if House Speaker Kurt Daudt, R-Crown, drops his push for $2 billion in tax cuts.

"If they decide they can't do that, I guess we'll just have to wait until next year," Bakk said of House Republicans. "But they can't expect that I'm going to give up on my number-one priority and they're going to continue to get theirs."

Gov. Mark Dayton said he agrees with Bakk that Republicans have to move on transportation if they want a tax bill. Dayton and the Senate are pushing for a tax hike on the wholesale price of gasoline that equates to at least 16 cents a gallon.

Daudt, however, said there's no way his caucus will back a gas tax this session. He's frustrated that Bakk won't look at the Republican plan to cut taxes and cut back on health and human services spending.

"I'm disappointed to hear Sen. Bakk saying maybe we should take transportation off the table," Daudt said. "To me, that shows a lack of leadership."

Increased funding for transportation appeared to be a top priority for both parties heading into the session. But Republicans and Democrats quickly disagreed over where to get the money.

Despite the hardline positions of Bakk and Daudt, the House and Senate leaders who handle transportation aren't ready to give up. State Sen. Scott Dibble, chair of the Senate Transportation Committee, said he's still hopeful a plan will come together.

Dibble, DFL-Minneapolis, warned that there is not much time left this session.

"As Scotty would say on the bridge of the Enterprise, you can't defy the basic laws of physics," Dibble said. "You can only do so much done so fast. Things need to start coming together so we can write the bills and process them and get them through committee and floor and all of that."

State Rep. Tim Kelly of Red Wing, who chairs the House Transportation Committee, said he doesn't believe Bakk is serious about giving up on transportation.

Kelly's 10-year funding plan would rely on a portion of the surplus, borrowing and dedicating existing sales taxes from auto parts, leased vehicles and rental cars to transportation.

"If we're going to try to walk out of here with a transportation plan, that would be certainly with the majority leader in the Minnesota Senate saying $7 billion isn't enough just because we can't get a tax increase," said Kelly, R-Red Wing.

Without new funding, it will be difficult for Minnesota to maintain its transportation system, let alone invest in new projects, state Transportation Commissioner Charlie Zelle said.

Zelle also is worried about a transportation stalemate in Washington. If the Republican-controlled Congress does not pass a new transportation bill or extend the current one by the end of the month, he said, state projects could be in jeopardy — even if legislators agrees on a plan.

"Without federal funding, it would put a huge hole in our program," Zelle said. "Our 10-year and 20-year outlook assumes level funding, not big increases, but modest increases of the federal program."

Zelle made his comments after U.S. Reps. Rick Nolan, Tim Walz and Keith Ellison also said during a news conference that they support increasing the federal gas tax to pay for transportation.