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August 16, 2007
Star Tribune commentary clarification
This morning's Citizens League commentary in the Star Tribune, "A bridge falls, and a policy window opens," drew a number of questions about this statement: "In 1970, Minnesotans paid about $3.75 per vehicle mile traveled in gas taxes. Today it's about $2 per mile when adjusted for inflation." The numbers should have read that Minnesotans paid 3.75 cents per vehicle mile in 1970 and are paying around 2 cents per vehicle mile today.The statement should also have specified that these are highway miles. The numbers that support this statement come from the Minnesota Department of Transportation (MnDOT) and were part of the Citizens League Transportation Study Committee report "Driving Blind." (see link below)
To see the relevant graphic, look at the Price of Minnesota Highways
After contacting MnDOT today, I am awaiting more details on the calculations, but here is the simplest way that I remember the explanantion from three years ago.
--Take the amount of miles traveled by all vehicles on highways in Minnesota and divide it into the amount of revenue raised by the gas tax that was spent on highways in 1970. The answer is 3.75 cents.
--Take the amount of miles traveled by all vehicles on highways and divide it into the amount of revenue raised by the gas tax and spent on highways in 2002 and adjust for inflation. The answer is 2.20 cents.
Therefore, with additional vehicles traveling more miles on more roads, and presumably, buying more gas (changes in efficiency of vehicles have an impact here), when we adjust for inflation, Minnesotans, as a whole, are paying significantly less in gas taxes for highways per vehicle mile traveled.
I assume in my statement that we have fallen from about 2.2 cents in 2002 to closer to 2 cents today, but I don't have the actual number.
Posted by Bob DeBoer at August 16, 2007 6:12 PM
Comments
I assumed the numbers were a typo and so I didn't make a big deal about them -- the point was valid. However, now that Sean and Bob have focused attention on this number it has my attention. If the State gas tax is 20 cents per gallon and a typical car gets 20 MPG isn't the tax burden somewhere in the neighborhood of one cent per mile?
Posted by: Steve Elkins | August 19, 2007 7:50 PM
I believe the calculation includes all state user tax charges that are appropriated for road infrastructure services. This should at least include motor vehicle excise taxes and registration fees. It could also include intergovernmental transfers of federal fuel tax funds. This should bring the figure closer to what was reported. I believe Mn/DOT's website has a series of graphics under its section on highway finance that clarifies this. Another good place to look is Barry Ryan's report for the Transportation and Regional Growth study that includes a summary of the state's transportation finances.
Posted by: Michael Iacono | August 21, 2007 1:46 PM
Here are the specifics for the user fees per vehicle mile traveled graphic from MnDOT:
The updated version of this particular graph is on MnDOT's website under the following link: http://www.dot.state.mn.us/information/funding2006/hwy-price.gif
The data is published in a book that MnDOT issues each year called the Financial Management and Legislative Briefing Package (FMLBP).
The graph aggregates all Highway User Tax Distribution (HUTD) revenues which include the gas tax, tab fees, automobile sales taxes (only the portion that goes to transportation), and some minor interest earnings and other small revenues. then adjust years to current year dollars using the CPI All Urban Consumers index 1982-84 (The index is reset so that current year = 1).
The formula then for each year shown:
HUTD Revenues Converted to Current Year Dollars divided by Vehicle Miles Traveled
It is intended to show the trend of Highway User Tax Revenues per Vehicle Mile Traveled over time using a constant dollar base. The graph does show that since 1975, users of highways are paying less per mile traveled in taxes today than they did during any of the preceding 30 years. It may be important to point out that the state doesn't get all the HUTD revenues. Article XIV of the MN constitution provides the information on how the money is distributed among the state, counties, and cities. http://www.house.leg.state.mn.us/cco/rules/mncon/Article14.htm
Posted by: Bob DeBoer | August 28, 2007 3:37 PM