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Fuel tax not keeping up with needs

By John Welle
If you’ve been following the topic of transportation funding recently, you’ll notice that it has once again become a politically charged debate, as both political parties attempt to blame the other for failing to address the transportation funding crisis while claiming themselves to be supporters of our highway system. In this article I’d like to take the discussion beyond the rhetoric and provide some factual insight on the topic.   
There are a number of contributing factors to our current transportation funding crisis, both on the revenue side and on the cost side. One of the main factors on the revenue side is the failure of the motor fuel tax to adjust for inflation. The motor fuel tax is the single largest source of revenue for highways in Minnesota, representing over 45 percent of all available state highway funding. A fixed rate of 28.5 cents per gallon is collected from the sale of motor fuels and constitutionally dedicated for street and highway purposes. Since the motor fuel tax is collected based on the fixed rate per gallon, there is no inflationary mechanism built into the tax. The same amount of tax per gallon is generated whether the price of motor fuel is $2 per gallon or $4 per gallon. Legislative action is needed to enact occasional increases to the motor fuel tax just to keep pace with inflation. However, this has been very difficult to accomplish in recent years given the political climate that we live in.
The motor fuel tax has always been collected as a fixed amount per gallon.  So why is it only recently that transportation funding has reached the current crisis level?
Prior to 2007, constantly increasing consumption of motor fuel resulted in increasing revenue year after year. Since 2007, however, motor fuel consumption statewide and nationally has declined every year due to increased vehicle fuel efficiency, alternative fuels, and simply less miles being driven.
The motor fuel tax today in Minnesota generates 33 percent more revenue than it did 10 years ago.On the cost side, however, road construction costs in that same period have more than doubled. It’s no coincidence that the highway construction cost increases have closely mirrored fuel price increases, as highway construction is very dependent on the cost of oil products and motor fuel.
The gap that I just described between rapidly increasing costs and slightly increasing revenues is the reason that the overall condition of our highways is plummeting. Highway improvement projects continue to be delayed or eliminated completely because of the lack of funding to pay for them. With each year that passes without a long-term, sustainable funding solution, the magnitude of the problem only gets worse.
We, as Minnesotans, have an important decision to make on the future of our highway system in our state. If we are not willing to support increases to transportation funding to keep up with ever-increasing costs, we will simply have to accept the fact that our highway systems are not going to be as good as we’ve grown accustomed to in decades past. That means roads that are not as smooth or strong as they once were, bridges that are more frequently posted for reduced weights, increased congestion on our major highways, and highways that fall well short of meeting state and federal safety standards. This description of our highway system isn’t meant to be a scare tactic, it’s simply a realistic vision of where we’re heading if we fail to enact long-term, sustainable increases in transportation funding.
If rougher and weaker pavements, weight-restricted bridges, longer traffic jams, and unsafe highways don’t fit your future vision of our highway system in Minnesota, we need to come together in support of transportation funding that keeps pace with increasing costs. Our state legislators need to hear from you, their constituents, that you support long-term, sustainable increases in transportation funding.
John Welle, the Aitkin County Highway engineer, is the president of the Minnesota County Engineers Association.