Tuesday, January 24, 2012

Minnesota Explores Mileage Tax

Minnesota DOT convened a 25-member blue ribbon task force last year to look at the possibilities of developing a mileage-based tax for transportation revenue in the state.  Their report, issued last month, fell far short of a ringing endorsement, calling the prospect of such a tax “both promising and problematic” and calling for “exploration” of the idea to “continue to advance in a measured, informed and thoughtful manner.”  This lukewarm endorsement was not troubling to advocates of the new tax, who understand that putting a new system in place will take lots of prep work.  The benefits and concerns laid out by the task force are similar to those identified in other studies, but it was interesting to see how these played out at the state level.
Some points of interest:
·      Falling revenues and lack of fairness were both tagged as problems associated with the gas tax, but fairness seemed to have more play in the presentation, with special mention of electric vehicles (including photos of EVs recharging).
·      The trucking interests on the task force worked to keep the report as neutral as possible, then filed a written minority report arguing that the report’s criticism of the existing system was overstated and its description of the problems associated with a mileage-based tax were understated.
·      Minnesota is one of those unfortunate states with a constitutional prohibition against using gas taxes for transit.  A mileage-based tax would not be subject to this provision, and a debate was begun (to be continued!) as to whether a prohibition should or should not be imposed.
·      A somewhat more muted debate (you can’t see it in the report) was begun on the issue of whether or not existing transportation revenues are or are not adequate for the future.  We have seen this argument in other states and will see more of it in the future. 
MnDOT, meanwhile, is conducting a demo project for a mileage-based system using GPS technology.

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