Margaret Donahoe, Executive Director, Minnesota Transportation Alliance
The Civic Caucus
8301 Creekside Circle #920,
Bloomington, MN 55437
January 20, 2012
Notes of the Discussion
Verne Johnson (chair), David Broden, Janis Clay, Paul Gilje, Jim Hetland,
Dan Loritz (vice chair), Tim McDonald, Clarence Shallbetter
Summary of discussion
Margaret Donahoe, executive director of the Minnesota Transportation
Alliance, argues that Minnesota is falling short of its maintenance of
roads and missing opportunities to invest in infrastructure necessary for
Minnesota to be competitive in future. Presently there is a gap of $1.5
billion/year between current state expenditures on road and transit and
the expenditures the Alliance believes are required for further growth.
Possible sources of additional revenue are identified.
A. Welcome and introductions
- Margaret Donahoe serves as executive
director for the Minnesota Transportation Alliance. Donahoe joined the
Alliance in 2000 to assist with legislative affairs and communications.
She has been Executive Director since 2008.
Donahoe also serves on the Executive Committee
for the Center for Transportation Studies at the University of Minnesota
and on the Transportation Advisory Board to the Metropolitan Council.
Prior to joining the Alliance Donahoe spend
eight years working for the Minnesota Senate, including three years as
Committee Administrator for the Senate Transportation Budget Division.
Donahoe received her Bachelor's degree from the
University of Minnesota and a Master's Degree in Public administration
from Hamline University.
Originally organized in 1983, the Minnesota
Transportation Alliance is a statewide coalition of organizations
including local governments, businesses, labor, the transportation
industry, transit systems, rail, waterways, and airports.
B. Background -
Recently two speakers have visited with the
Civic Caucus on the topic of transportation: Lee Munnich, director, State
and Local Policy Program at the Humphrey School of Public Affairs, and
John Hausladen, president, Minnesota Trucking Association. This interview
continues series on the topic of Minnesota transportation infrastructure
needs and means.
The prior two interviews with Munnich and
Hausladen may be found on the Civic Caucus website at:
THE PROBLEM: funding of transportation
has not kept up with needs.
The Alliance represents all modes of
transportation, Donahoe said, and it is a juggling act to keep all members
on the same page. Yet it is clear there is a range of needs, from road and
bridge maintenance to transit, and the funding of much of those needs is
not being met.
The Alliance has estimated there will be a
cumulative $30 billion funding gap for all modes of transportation over
the next 20 years. It expects the state will require a $1.5 billion more
per year than it is spending now to reach the goals of the Alliance's
The Alliance succeeded at the Legislature in
2008 with a transportation-funding package it had supported. That funding
legislation has not generated as much revenue as anticipated at the time
it passed, Donahoe said. Further, the Alliance expects that the state will
begin seeing a decline in revenue from the gas tax as people buy more
There appears to be a lot of emphasis on moving
people, not products, Donahoe said, and that adds a complicating dimension
to the funding problem the Alliance confronts. Often, legislative funding
efforts will focus on traffic congestion in metropolitan areas, but many
Alliance members are rural and use roads for transport of goods. This part
of the funding problem needs serious attention if Minnesota is to remain
THE GOAL: Fund all components of the
transportation system sufficiently.
The state is close to meeting maintenance needs
The current level of state transportation
funding is close to meeting road and bridge maintenance needs, Donahoe
said, and if funds are used only for maintenance, existing roads can be
kept in reasonable shape - but then the state couldn't do anything else to
invest in future transportation needs.
Yet there are new opportunities for
"When you lay all the needs out on a map I think
people can see that transportation is truly part of an integrated system,"
Donahoe said, "and they can see more clearly what we're trying to achieve
Much of the state's infrastructure is what the
Alliance calls "baby boomer infrastructure", a large outgrowth during the
post World War II housing expansion. In many cases state and local roads
were built for car traffic, not for heavy loads. The Alliance is
interested in building a network of roads designated accommodate
10-ton-per-axle trucks. County engineers have identified key local roads
that they can route heavy commercial loads to, and upgraded roads must be
put in place to move heavy loads from rural plants and agricultural areas
to commercial centers.
While strengthened roads are desirable,
prevention of excessively rapid depreciation is important as well, by, for
example, requiring trucks to have more axles.
People feel that the highway system is now to a
great degree "complete." Twenty years ago there was an expectation of more
new developments, of building for the future. Today there's more interest
in transit. Donahoe suggested, "It's reasonable to expect that the transit
lines will be built if we can get 50 percent of the funding from federal
Minnesota is comparable to other states in terms
of spending on infrastructure. The gap in Wisconsin is very similar to
Minnesota. But that is no reason to feel complacent. As a nation, Donahoe
says, we're in trouble. According to the National Surface Transportation
Policy and Revenue Study Commission, the country needs an investment of
$225 billion annually from all sources over the next 50 years to upgrade
our existing system to a state of good repair and create a system able to
sustain a strong economy. We are spending less than 40% of this amount
today. The country needs to invest $140 billion more each year. While
China invests around 9% of GDP on transportation infrastructure and
European countries invest close to 5%, the US continues to invest only
about 2% of our GDP on transportation infrastructure.
THE STRATEGY: Demonstrate possible future
Get the public engaged in demanding adequate infrastructure.
To be successful Donahoe said transportation
advocates need to get the public engaged.
"Unfortunately transportation and infrastructure
are not hot political topics."
The Alliance knows they need public support or
they won't have legislative support. When they look at issues with
successful funding requests, those are issues whose advocates are very
specific about where the money goes. The public has to be able to trust
where the money is going to be used - or else legislators just say 'no.'
"How can we get the public engaged and win their trust that the money will
be used the way we say it will be used?" she asks.
Possible sources of additional revenue are
The Alliance has collected the requests from the
various agencies including MNDOT, and private associations, and put them
in one package of funding requests.
The total additional request in excess of
maintenance costs is approximately $1.5 billion per year.
Local option sales tax maximize leverage
authority ($80-200 million)
Gaming revenue yearly estimate ($250 million)
Total: up to $900 million/year new
revenue. Financing options such as bonding, public-private partnerships,
etc would allow projects to be accelerated with payback over time.
Other options that are difficult to estimate a
dollar amount for include: increased general fund appropriations,
dedication of sales tax on vehicles parts and services, sales tax on fuel
purchases, toll revenue, street improvement districts, payroll tax,
surcharge on DWI and other moving violations, transit advertising revenue,
increased farebox recovery, and an annual fee for electric vehicles.
Any request for funding has to be sufficiently
bold to gain support.
The Alliance believes legislators want to know
that if they vote for a tax increase it will be enough of a tax increase
to do some good. "The people who are anti-tax won't vote for anything. For
those who will, what's the point of voting for 3 percent or voting for tax
increases that will not result in significant improvements in important
Building the political support takes time. The
Governor has indicated he will appoint a transportation finance task
force, but has not named the appointments yet.
D. Closing -
There is a significant transportation problem
that the state is not addressing because of the lack of a well-understood,
well-publicized plan and the political support to provide the momentum for
legislative action, Donahoe argued.
There needs to be more of a conversation to
engage the public so they know what will and will not be built. If we want
to be a world class state we need the public to understand that investing
in transportation is necessary," she said.
The chair thanked Donahoe for the informative
The Civic Caucus
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Verne C. Johnson, chair; David Broden, Marianne Curry,
Paul Gilje, Jim Hetland, Marina Lyon,
Joe Mansky, John Mooty, Jim Olson,
and Wayne Popham