Why is transportation a critical issue?

An efficient, accessible, and reliable transportation system is crucial to the success of
TwinWest member businesses. The state’s economy and business’ bottom line
depends on our ability to move people and goods. Currently, Minnesota’s roads,
bridges, and transit systems are in dire need of upgrades and repairs. Commuters
and freight are consistently slowed by congested traffic. Their routes are altered and
their safety is jeopardized by over-capacity roads and crumbling bridges. Few transit
options are in place, and cost-effective enhancements languish without adequate
funding. Additional transportation investment will directly impact the state’s economic
well-being.

According to the Texas Transportation Institute’s 2007 Urban Mobility Report, Twin
Cities Metro Area commuters waste an average of 43 hours per year stuck in traffic.
The Twin Cities Metro Area ranks sixth worst in the nation in traffic congestion
among 27 similar size metropolitan areas. The estimated annual cost of
congestion in the Twin Cities region was more than $1 billion in 2005
(based on $2.19 gasoline), and resulting in nearly 42 million gallons of excess
fuel burned while sitting in congestion.

What are Minnesota’s transportation challenges?

Rapid growth

The continued rapid growth of the western and northwestern suburbs has greatly increased demand on our transportation infrastructure. Between 1990 and 2000, more than 250,000 jobs were added to the Twin Cities metro area. This growth led to a 33 percent increase in the number of workers commuting to the epicenter of the area
(Hennepin and Ramsey counties), while suburb-to-suburb commuting increased as well.

Underinvestment

Estimates based on studies of road and bridge needs call for anywhere from $1 billion
to $1.5 billion in additional transportation investments annually over the next 10 years
to meet current system needs and reduce the rate of increase in traffic congestion.
Road projects important to businesses in the TwinWest area, including reconstruction
of Highway 100 and completion Highway 610, have been pushed back decades due to
funding shortfalls. Completion of the Metropolitan Council’s 2020 Plan and the
Southwest Transitway is projected to cost nearly $100 million/ year over the same
time period.

Future demand

The Twin Cities is expected to continue growing at a healthy rate. By 2030, the Met
Council projects the metropolitan region will add nearly 1 million new residents
and 560,000 new jobs. This growth and increased travel activity will take place on
top of a relatively fixed number of roadway miles. The inadequacy of the current
system to meet today’s needs will pale in comparison to the situation in the next
several decades if transportation investments are not wisely planned and
adequately funded.

What transportation solutions does TwinWest advocate?

Increase transportation funding

• The state should rely on transportation user fees when considering new funding
  options. Specifically, the TwinWest Chamber supports up to a five cent
  phased-in increase in the state’s gas tax, which has not been increased since
  1988. According to the Minnesota Chamber of Commerce, today’s real value of
  that 20 cent fuel tax is only 13.2 cents. As shown in the chart on the previous page,
  Minnesota’s transportation investment in terms of real dollars has been stagnant
  since 1975. According to the Minnesota Department of Transportation (MnDOT),
  a five cent increase in the state’s gas tax would raise $160 million in additional
  revenue every year. TwinWest also supports a 2.5 cent fuel tax surcharge to
  finance debt service on trunk highway bonds.

• TwinWest supports the partial restoration of cuts made to vehicle tab registration
  fees.

• A trunk highway bonding proposal needs to be included as part of a comprehensive
  transportation funding package. Utilizing bonding for transportation projects,
  especially when combined with long term real increases in funding streams, is an
  effective way to advance projects now and avoid inflationary increases in project
  costs by locking in a low interest rate. The Minnesota Constitution should also be
  amended to allow for the use of general obligation bonds for highways.

• 60 percent of the motor vehicle sales tax on leased vehicles should be dedicated
  to road and bridge projects.

Bring accountability and efficiency to transportation spending

• Transportation dollars should go toward transportation projects. The passage of the motor vehicle sales tax dedication in November 2006 ballot was a step in the right direction. All leakages from the trunk highway fund should be stopped, and no trunk highway fund revenue should be used for non-highway purposes, as directed by the state constitution.

• The cost/benefit analysis conducted on all proposed transportation investments should be a primary factor when considering spending allocations. Fewer transportation dollars should be spent on projects with limited economic benefits, with those dollars being transferred to projects that will have a positive impact on job creation and economic vitality.

• The distribution of revenue from highway user tax distribution fund should be prioritized according to roadway utilization, impacts on congestion, and current and anticipated construction needs.

• Through the area transportation partnerships process, the commissioner of transportation should recommend to the Legislature on a biennial basis the road and transit projects and programs to be funded from the general fund appropriation.

Move the region toward a truly regional multi-modal transportation system

• The Twin Cities metropolitan area needs a unified vision for transportation infrastructure, operations, and funding. TwinWest supports efforts to create a business vision for our statewide transportation system, with statewide input from all types of industries.

• The Twin Cities’ regional transit system needs to be planned and executed as a system – not as individual lines. Priority within the system should focus resources on those components with the highest cost/benefit ratio and ability to leverage federal funds, and not be made based on political expediency.

• TwinWest has led the formation of the Southwest Transitway Alliance in cooperation with the cities of Minneapolis, Saint Louis Park, Hopkins, Minnetonka, and Eden Prairie, the Hennepin County Railroad Authority, and the Minneapolis and Eden Prairie Chambers Commerce to advocate for cost-effective implementation of a regional transit system.

• TwinWest supports the legislative agenda of the Metropolitan Coalition of Chambers, an association of 25 metro area chambers of commerce that joined together in 2002, as advocates for significant investment and improvement in the Twin Cities transportation system. TwinWest also supports the Minnesota Moves initiative.

• TwinWest recognizes the need for a stable, dedicated funding source for transit
  capital and operations, and supports the following funding mechanisms to pay
  for the capital and operating costs necessary to complete the projects outlined
  in the Metropolitan Council’s 2020 goal and the Southwest Transitway
  (approximately $100 million annually):
  
  - Value capture on increased property and/or sales tax value due to light rail 
     transit improvements.
  - Fare box recovery from light rail transit lines/bus rapid transit to support at
     least 50 percent of the operating costs for the lines.
  - General obligation bonding to fund transit capital improvements, including 
     the $140 million request for the Central Corridor.
  - Dedication of 40 percent of the motor vehicle sales tax on leased vehicles.

• TwinWest member businesses continue to express deep concerns with the 
   implementation of a metropolitan area sales tax dedicated to transit and
   transitway development. This tax would greatly impact businesses, increase
   prices for consumers, hurt Minnesota’s competitiveness by adding to an already
   high tax burden, and create another unneeded level of government bureaucracy. 
   As proposed, TwinWest opposes the creation of a metro-wide sales tax due to 
   the following provisions:

  - The arbitrary .5 percent increase would raise nearly twice as much revenue as 
     is needed.
  - The tax would be implemented without any reductions in business inputs 
     subject to the sales tax and without any broader discussion of sales tax reform.
  - No specific plan or timeline has been outlined that would define exactly what 
     this tax would fund and when it would be completed.
  - The tax does not sunset nor is it reduced upon completion of the specific
     projects it was designed to fund.