Which transportation plan is a fantasy?

light rail

light rail

It is clear that the largest issue of the 2015 state legislative session is going to be transportation; both sides are talking about it, and they each have different visions for the future of Minnesota’s infrastructure. On one side is Governor Mark Dayton proposing $6 billion over the next decade in new spending. He proposes to fund this plan by increasing taxes– specifically a wholesale gas tax and an increase to the State’s license tab fees. On the other side is the Republican House, which is arguing for only $2.5 billion in spending over the same period of time. Their plan calls for funding to come from part of the current budget surplus, and from cutting inefficiencies in the transportation budget. In a press conference on January 9th, Governor Dayton called the Republican proposal impossible and a “straight fantasy.” Is the Republican solution of spending less and not increasing taxes by cutting inefficiencies possible?

The main difference between the plans is the different levels of spending; the Republicans want to spend $3.5 billion less than Governor Dayton. A lot of these savings come from Republicans being against the Southwest Light Rail project, which would run from Eden Prairie to Minneapolis. This also leads to a new question: is Light Rail financially efficient? Data says that the answer is no. Light Rail loses approximately $40 million every year, and this year it is budgeted to lose $43.26 million according to the Metropolitan Council. This difference has to be made up by subsidies from Federal, State, and Local governments. The State doesn’t technically pay for all of the deficient, as $25.6 million comes from Local and Federal sources, but the idea of adding another yearly cash drain could make future transportation budgeting even harder.

The next public transportation option proposed by Governor Dayton is increased spending on buses, but are buses financially efficient? The short answer, again, is no. When Federal, State, and Local money is taken out of the equation, the METRO Transit Bus System is budgeted to lose $218.9 million dollars in 2015, according to the Metropolitan Council’s 2015 Budget. According to their website, Metro Transit currently offers 214 bus routes. On average, that is a loss of a little over 1 million dollars per route, per year. One interesting thing to note is that almost $200 million of the subsidies annually comes from the State’s Motor Vehicle Sales Tax, which was originally designed to go to roads, but is now being partially diverted to buses.

Realistically, the Republican proposal will not feature a removal of all state funding for light rail and buses (even though it would cover $2.2 billion of their $2.5 billion proposal). However, there is clearly some savings that can be found in the current transportation budget. An example is bus route 671, which connects the two small, affluent western suburbs of Excelsior and Deephaven to downtown Minneapolis. With all of this in mind, perhaps Mark Dayton should at least listen to the Republican’s proposal before dismissing it as fantasy.