To gain support of Republicans, DFL makes cuts to plan that would increase the state's gas tax

ST. PAUL -- Minnesota drivers would pay up to 8.5 cents a gallon more for gasoline under the House version of an evolving transportation funding plan coasting through the Legislature.

ST. PAUL -- Minnesota drivers would pay up to 8.5 cents a gallon more for gasoline under the House version of an evolving transportation funding plan coasting through the Legislature.

Bowing to pressure from legislators and transportation advocates, Democratic-Farmer-Labor Party lawmakers on Monday said they are stripping an automatic inflationary gas tax increase from their $8.3 billion plan for road, bridge and transit projects.

Removing the controversial measure, called indexing, was done to get support -- mostly among Republicans -- for the funding package as it nears floor votes Thursday and an anticipated veto override attempt, the bill's authors said.

"It'll make them feel better because they don't care for indexing," said Rep. Bernie Lieder, DFL-Crookston, the House transportation chairman. His bill includes a nickel-per-gallon gas tax hike this year, plus a 3.5-cent hike in the coming years to repay state-borrowed funds for transportation projects.

Sen. Steve Dille, a Dassel Republican, said he would back a higher gas tax before allowing it to rise with inflation.


"I think we should vote on tax increases and not put them on autopilot," Dille said after a funding package was approved by the Senate Finance Committee. "I would guess it would make it easier for Republicans to vote for it if that was out."

Sen. Steve Murphy, DFL-Red Wing, said the gas tax index will be removed from his bill when it is heard Wednesday in the Senate Tax Committee. His version still will have a nickel hike this year and up to another nickel in coming years to repay state-borrowed funds, he said.

"I think that we pick up more people now that the indexing it out than we lost because they want it in," Murphy said.

But Democrats will not pick up every lawmaker's vote.

"It's not enough," said GOP Rep. Dean Simpson of Perham of removing the inflationary increase.

Simpson is lead Republican on the House Taxes Committee that approved Lieder's bill on a divided voice vote. Simpson said Democrats were concerned some of their own members objected to an inflationary gas tax hike.

"The reality of this whole bill is coming to play," he said.

A gubernatorial veto is expected. Gov. Tim Pawlenty, who opposes a transportation package with tax increases, said "it's pretty clearly headed in that direction."


"They've made it very clear that they believe I'm irrelevant to the discussion and they're going to put a bill on my desk that fits their definition of what they want to do and believe they can override my veto," Pawlenty told reporters. "I wish that wasn't the case, but that appears to be the trajectory they're on."

If the bill proceeds as expected, it is unclear if Democrats can convince enough Republicans to help override a veto.

Minnesotans would pay more for gasoline with the DFL bill, Murphy said, but they will see transportation improvements.

"They're definitely going to notice a difference because their roads are going to get fixed," he said. "That's the bottom line here, fixing roads and lowering the (vehicle crash) fatality rate."

The state's gas tax is 20 cents a gallon. Indexing would have resulted in a rate of 31.4 cents a gallon in 10 years, nonpartisan legislative experts said. By removing the inflation provision, the tax should be 28.5 cents a gallon by 2018.

Democrats' transportation funding package would increase the license tab fees owed on new vehicles registered in the state; those fees would be higher on luxury vehicles. Minnesotans who drive their existing vehicle or buy a used vehicle registered in Minnesota would not see an increased tab fee under the plan.

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