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Home My WebLink About5I - Minnesota's Transportation Amendment MEETING DATE: AGENDA #: PREPARED BY: AGENDA ITEM: DISCUSSION: ISSUES: 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 CITY COUNCIL AGENDA REPORT August 21,2006 51 ~ Frank Boyles, City Manager}\ CONSIDER APPROVAL ESOLUTION SUPPORTING MINNESOTA'S TRANSPORTATION AMENDMENT. Introduction The purpose of this agenda item is ask the Council to adopt a resolution supporting a constitutional amendment which would dedicate 100 percent of the motor vehicle sales tax to roads, highways and public transit. Historv In 1981, the legislature passed a law dedicating all motor vehicle sales tax revenue to highways and transit. However, for 20 years, some or all of this money has been diverted away from transportation to pay for other state programs. More than $6 billion in motor vehicle sales tax revenue has been used for non- transportation purposes. Today only 54% of the revenue for the existing motor vehicle sales tax is used for transportation purposes. Current Circumstances The 2005 legislature decided to give voters a chance to determine if 100 percent of the existing tax should be dedicated to funding highways, bridges and transit systems. The amendment scheduled for consideration this November 7 will ask, "shall the Minnesota Constitution be amended to dedicate revenue from a tax on the sale of new and used motor vehicles over a five-year period, so that after June 30, 2011, all of the revenue is dedicated at least 40% for public transit assistance and not more than 60 percent for highway purposes. Forty-six percent of the existing motor vehicle sales tax is presently being used to support the State's general fund. The materials provided by "vote yes" do not identify the general fund programs presently supported. So the question is, how many of those programs will be cut or require alternate funding sources? The amendment does provide for a five-year phase-in which should help to moderate the impact. The state has billions of dollars of road infrastructure throughout the State. A large percentage of this roadway has been allowed to significantly deteriorate. I could not find any data which indicated how long it would take to bring the State's road infrastructure into acceptable condition with this new influx of funds. www.cityofpriorlake.com Phone 952.447.4230 / Fax 952.447.4245 FINANCIAL IMPACT: ALTERNATIVES: RECOMMENDED MOTION: The Association of Metropolitan Municipalities is a member of "vote yes." Since Prior Lake is a member of the AMM, we are indirectly a member. Prior Lake is being asked to be a supporter of the coalition just as 45 other cities have decided to do, together with over 100 Minnesota counties including Scott. Total coalition members and supporters include 846 organizations. As indicated above, it is not clear if the legislature will cut or change the funding source of the general fund programs presently funded by the motor vehicle sales tax. Their decision will determine whether the City or taxpayers will be impacted by the shift. 1. Adopt the attached resolution. 2. Adopt a motion to become a supporter. 3. Take no action. As the Council deems appropriate. 16200 Eagle Creek Avenue S.E. Prior Lake, MN 55372-1714 RESOLUTION 06-xx Motion By: Second By: WHEREAS, Minnesota's transportation infrastructure forms the backbone of the state's economy and has a direct impact on future economic development; and WHEREAS, Funding for highway and transit systems in Minnesota has remained stagnant and is failing to keep pace with growing population and growing demands; and WHEREAS, Local governments throughout the state are struggling to maintain local transportation systems while the state's gas tax has not been increased since 1988 and transit budgets have been cut in recent years; and WHEREAS, The Minnesota Legislature has repeatedly turned to revenue from the motor vehicle sales tax, which has been viewed as user fee revenue, in order to fund both highway and transit systems including the current dedication of 54% of motor vehicle sales tax for transportation purposes; and WHEREAS, The legislature passed a proposed constitutional amendment during the 2005 Legislative Session that would appear on the ballot November 7,2006, asking voters if the remaining 46% of motor vehicle sales tax revenue currently Used for other purposes should be used for highways and transit systems; and WHEREAS, Passage of this amendment would mean an increase in stable revenue for highway and transit systems throughout the state that would rise to approximately $300 million per year once the transfer of revenue is fully phased-in by 2011; NOW THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA as follows: 1. The recitals set forth above are incorporated herein. 2. The City of Prior Lake strongly supports passage of the proposed amendment to the Minnesota Constitution dedicating all of the motor vehicle sales tax revenue to transportation with at least 40% of the revenue for public transit assistance and not more than 60% of the revenue for highway purposes. PASSED AND ADOPTED THIS 21st DAY OF AUGUST, 2006. YES NO Haugen Dornbush Erickson LeMair Millar Haugen Dornbush Erickson LeMair Millar Frank Boyles, City Manager M/WW.{;ityQ{prjor!ake.,cQm Phone 952.447.4230 / Fax 952.447.4245 July 26, 2006 Vii1rtr iiP",,".~~~~IJ The Honorable Jack Haugen Mayor, City of Prior Lake 16776 Fish Point Rd Prior Lake, MN 55372-3323 RECEIVED JUL 2 8 2006 Dear Mayor: As local officials, we have a unique perspective on the impact Minnesota's transportation system has on the strength, safety and economic development of individual communities. Nearly every day, we hear from our constituents about everything from potholes and dangerous local intersections to the need for more public transit options. We also hear broader concerns about bridges and highways that are not designed to support the transport of goods and services to fuel our local economies and the impact that will have on the future vitality of our area. Despite the significant effect transportation has on our quality of life, years of regional and ideological battles have prevented Minnesota from making significant, sustained investments in a balanced statewide transportation system. Our roads, bridges and transit systems have endured decades of neglect and disrepair, forcing local officials to make difficult decisions about where to spend limited resources. Increasingly, local governments have had to turn to local property taxes to improve highways that are critical to our communities. We know that transportation needs are different for nearly every community in the state, but there is one thing we all need - adequate revenue to make investments in transportation. Right now, we have an opportunity to support a positive, first step toward meeting our local transportation needs now and in the future. On November 7, Minnesotans will vote on Minnesota's Transportation Amendment. This constitutional amendment will dedicate 100 percent of the existing motor vehicle sales tax to roads, bridges, highways and public transit throughout the state, providing an additional $300 million per year in new revenue for transportation projects throughout the state. It clearly will not solve our transportation funding crisis, but it represents part of the funding solution and will move us closer to making progress on critical transportation infrastructure needs. We urge you to join with over 700 other local governments, business, transit, transportation, environmental, labor and civic organizations in support of Minnesota's Transportation Amendment. A new coalition, Minnesotans For Better Roads and Transit (MBRT) is bringing people together around this issue and it has become the largest and most diverse coalition to unite in support of a constitutional amendment in state history. The strength and depth of support for Minnesota's Transportation Amendment is evidence of the significant role transportation plays in the lives of all Minnesotans. Here are some of the reasons why over 70 cities and townships, including the League of Minnesota Cities, 60 counties and 30 local government organizations have already signed up to support the transportation amendment: It's common sense. Dedicating 100 percent of our transportation tax dollars to transportation is a logical and necessary first step toward meeting our transportation needs. Our communities will benefitfrom a dependable, sustainable commitment to transportation. Twenty-five years ago, the Legislature decided that all revenue from the existing motor vehicle sales tax should be used for transportation. But every year, some or all of that revenue has been diverted to other purposes - more than $6 billion since 1981. Minnesota needs a balanced approach to transportation. The transportation amendment will help ensure that balanced investments in rural and metro communities for roads, bridges, highways, buses and rail systems will create a transportation system that serves all Minnesotans. www. Vote YesMN. org Page 2 Minnesota's Transportation Amendment will give current and future local leaders the additional resources we need to better serve our communities. The amendment may not be the solution to all of our transportation problems - but it is a significant fIrst step that we cannot afford to pass up. It is our job to maximize opportunities that benefit of our communities - Minnesota's Transportation Amendment is one of those opportunities. Please sign on as a supporter today by simply logging on to htto://www.votevesmn.onuDartnersil!11UD.html or contact Margaret Donahoe at 651-659-0804 or MarlZaretDonahoera>.TransDortationAlliance.com. We look fonyard to working with you to pass Minnesota's Transportation Amendment. Sincerely, &'a G.~ t)~~ Judy A. Johnson Mayor, City of Plymouth David Kleis Mayor, City of Saint Cloud