Minnesota Legislature overrides transportation veto; fuel tax will increase

| Wednesday, February 27, 2008

For the first time in 20 years, car and truck drivers fueling in Minnesota soon will see the state’s per-gallon tax on fuel increase.

The Minnesota Legislature voted Feb. 25 to override Gov. Tim Pawlenty’s veto of a 10 year, $6.6 billion transportation bill. In addition to higher fuel taxes, roads, bridges and transit also will get a boost from higher sales taxes and license tab fees.

The House voted 91-41 in favor of the legislation – HF2800 – that ends a long-running transportation funding debate. It needed 90 votes in the chamber for the override. The Senate followed suit on a 47-20 vote.

Pawlenty was critical of lawmakers’ decision to go against his wishes. It was the first time the governor’s veto has been overridden since he took office in 2003. He said the state cannot afford the tax increases.

Supporters say changes are needed to improve the state’s transportation system. They cite the need to replace bridges that have serious structural problems. An infusion of revenues for state and local road construction and maintenance also was needed, they say.

The per-gallon tax on gas and diesel will climb a nickel, to 25 cents per gallon, by the end of the year. The current 20-cent-per-gallon tax rate hasn’t changed since 1988.

The fuel tax will rise by 2 cents per gallon on April 1 and another 3 cents this fall. Another 3.5-cent increase will be phased in during the next few years to pay off road construction debt.

Also included in the bill is a quarter-cent increase in the sales tax in the seven counties surrounding Minneapolis-St. Paul. Registration fees for new vehicles bought throughout the state will increase after Sept. 1. In addition, annual license tab costs on affected vehicles also will rise.

To view other legislative activities of interest for Minnesota, click here.

– By Keith Goble, state legislative editor
keith_goble@landlinemag.com

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