In an economics experiment known as the ultimatum game, subjects offered a share of a $10 windfall regularly turn down the free money if they think their cut isn’t big enough and somebody else’s is too much. That way, under the rules of the exercise, nobody gets anything.
Minnesotans have been engaged in something similarly illogical for nearly two decades when it comes to the transportation funding that is vital to our state’s prosperity.
Some Twin Cities opinion leaders say we can’t increase state taxes for roads and bridges because rural Minnesota gets too much of the constitutional funding formula for lightly traveled county roads. Some outstate officials argue against taking action on grounds that the state spends too much on freeways and transit in the metro area.
Both sides exaggerate supposed outrages, but the result has been gridlock on the roads and at the State Capitol.
Interestingly, however, neither camp disputes that the unmet need is enormous: an estimated $3 billion-a-year gap that actually has been held down by increasing contributions to transportation from property taxpayers.
It’s even more interesting – confounding, too – that the urban-rural divide over transportation is really a relic of the past. It was largely settled three years ago by the people in the best position to negotiate it, county commissioners from across the state working through the Association of Minnesota Counties (AMC).
Their proposal was reflected in comprehensive transportation finance bills passed by bipartisan legislative majorities in both 2005 and ’07, but unfortunately vetoed by Gov. Tim Pawlenty.
“We have agreement,” said Harlan Madsen, a Kandiyohi County board member and former AMC president. “Everybody loses when we stick with this win-lose attitude. It’s not about creating good public policy.”
Hennepin County Commissioner Peter McLaughlin, another past AMC president, said the deal was cut after extremely tough bargaining. “It wasn’t easy,” he said. “The interests are different; the needs are different. But there was agreement that we need a robust transportation system because our economy depends on it. In fact, we are united.”
Despite this, the urban-rural split lives on in the obstructionist rhetoric of those who “use it as a way to keep from doing anything,” McLaughlin said. As the ultimatum game demonstrates, that tactic still has power to persuade the uninformed.
Meanwhile, though, rural roads get more dangerous, Twin Cities freeways get more congested and bridges deteriorate across Minnesota. And everyone’s property taxes keep rising to make up for the shrinkage of user fees from gasoline taxes and vehicle registrations that are apportioned among city, county and state highways.
“Nobody wants tax increases, but you can’t get something for nothing,” said Mary Harrison, a member of the Wadena County Board, which has been forced to raise property taxes $1 million – a 150 percent hike in just four years – just to maintain local roads and bridges overstressed by burgeoning semitrailer traffic serving large-scale farms.
“And we’re a very poor county with an aging population,” Harrison added.
Urban, rural and anything in between, Minnesota’s elected county leaders are in full agreement over what needs to be done. It’s time for the rest of our government to get on board.
“A significant gas tax increase is needed,” Cook County Commissioner Bob Fenwick, the current AMC president, wrote in a September report. “The local sales tax in the seven-county metro area is needed. An optional sales tax in Greater Minnesota is needed. Wheelage taxes are needed. An adjustment in motor vehicle registration fees is needed.
“Each of those statements is hard for me to write. I don’t want to raise taxes and I don’t want to pay increased taxes. But the alternatives are much worse … The time is now for us all (the governor, the Legislature and local officials) to earn our leadership badge and adopt a renewed vision for Minnesota.”