Growth & Justice Blog

Less Government? We Tried That. It's Not Working.

The Star Tribune's front-page story today finds that "less government'' is the overwhelming consensus "vision'' for Republican gubernatorial candidates. Peggy Lee and most Minnesotans want to know: Is that all there is?   

Leaving aside that this mantra sounds more like hard-right, activist-energizing radio talk than inclusive vision casting — and has to be extremely disappointing to hundreds of thousands of moderate and progressive Republican voters — we need some context here.   

The Price of Government, an official state Minnesota Management and Budget measure, shows that we DO have less government over the last decade, ever since the no-new-taxes religion, like some southern invasive species, got a hold on the North Star State. (See page 13 of the PowerPoint presented at the capitol last week by State Economist Tom Stinson and State Demographer Tom Gillaspy).

The bar graphs clearly show that our governments are using about two percentage points less (15.5 percent in 2008 compared to about 17.5 percent through the 1990s) of our personal income share than those governments were spending when the economy was actually doing better. Huge income tax cuts in 1999 and 2000 left us with chronic  budget crises, and the promised payoff in sustained, tide-rising economic growth didn't materialize, either.  

Wealth concentration at the top got worse, bridge and road conditions deteriorated, public school course offerings were cut, and thousands of working low-income folks lost their health care. And our economy is slumping and beginning to underperform the national average on some key indicators.  

We surely could use some more judicious restructuring and redesign of how we do our government work. But the basic things government provides are essential for our shared prosperity and quality of life.  

NOTE: The Price of Government measure is one of the most comprehensive of all the measures we have to describe the size and role of government. It counts state and local government revenues as a percentage of total income and therefore accounts for inflation, population growth and economic growth. It was instituted at the behest and with the approval of business groups in the late 1980s.

— Dane Smith

Highways investment gap highlights need for alternatives

The Minnesota Department of Transportation’s just-released statewide transportation plan on policies and highway investments flags a startlingly large $50 billion gap between dollars available for roads and bridges and the $65 billion required to meet state needs in those areas over the next 20 years.

Ouch.

No surprise that under our current policies and approaches, Minnesota’s transportation needs are rising.  Over the last 20 years, travel by car and truck in the state shot up at a rate nearly three times faster than population growth. 

It doesn’t help that we drive more in Minnesota than they do elsewhere — fully 10 percent more on a per capita basis when compared to national rates. 

And, like other states, Minnesota has an aging transportation infrastructure in need of significant renovation and rehabilitation. We face significant costs just to keep what we have.

Mn/DOT wisely plans to spend three-fourths of the projected $15 billion in highway dollars available over the next 20 years on a fix-it-first strategy, looking to preserve or replace existing roads and bridges. But the $50 billion gap is a wake up call for us to look beyond our present focus on more roads and more driving and pursue other strategies to address overall transportation challenges. 

To its credit, Mn/DOT’s transportation policy plan, released at the same time, acknowledges that “a more multimodal and multi-jurisdictional approach to transportation is needed to achieve major goals, including maintaining Minnesota's economic competitiveness, reducing greenhouse gas emissions and providing modal choices for consumers.” Other plans addressing transit, freight, metro highways and “complete streets” will be forthcoming.

As noted by Mn/DOT, region-wide transit stands out as part of the solution for urban areas in the state, with its potential for improving transportation access and mobility, as well as the quality of life for many Minnesotans.  Significant increases in transit use can reduce the need for more lane miles in the metropolitan area and yield the added benefits of reducing fuel consumption and air pollution.   

Traffic management strategies also have an impact on Minnesota’s roadways. The Texas Transportation Institute in Austin estimates that traffic delays for Twin Cities metro rush hour travelers is lower by 5.5 million hours than it would be if not for traffic management approaches, such as metered ramps on freeways, rapid response to accidents and incidents, and high-occupancy vehicle lanes.

But to slow the high demand for travel, state, regional and local governments also must consider land-use policies. As noted in the Mn/DOT plan, “Local governments can use their planning and zoning powers to guide land uses that make efficient use of the transportation system.”

We should discourage sprawl and encourage the concentration of jobs in downtowns and centralized employment centers.  We should link affordable housing to transit lines and stops.  And we should design complete streets that work well not only for cars but for all users, including transit vehicles, pedestrians and bicyclists.

Even with improvements and changes in these other areas, Minnesota will still need to spend billions to address bottlenecks and fund maintenance and overhauls on roads and bridges that need attention.  Billions of dollars, yes, but billions less, perhaps, than the $65 billion in needs identified.

Minnesota’s transportation system affects the economic outlook for the state and both the economic well-being and quality of life for Minnesota residents. Given the daunting needs we face for state spending on transportation, it’s past time for Minnesota to consider not just how much to build and repair highways but how best to both address and alter those needs with new investments, policies and choices.

— Matt Kane

When Stimulus Worked for All.

From our Golden Valley yard, we can hear the thrum of traffic from Hwy. 100, once known as the Belt Line and Lilac Way.

Today, there's little evidence in this sound-wall-to-sound-wall carscape of a connection to the Great Depression and the Works Progress Administration (WPA). But a restored Lilac Park, dedicated this week near Highways 7 and 100, offers a modest reminder of what public investment can accomplish — and what may be lacking in today's attempts to stimulate an ailing economy.

This appeared in MinnPost today.

— Charlie Quimby

Funding transportation through "value capture"

After the bruising battle over the 2008 transportation bill, the Legislature requested a study of "value capture" as a potential way to raise revenue for future infrastructure investments in Minnesota. The University of Minnesota's Center for Transportation Studies has released its analysis of eight potential strategies for funding transportation based on the concept.

Currently, transportation improvements are funded by general revenue (based on the assumption that all benefit indirectly from the transportation network) and user fees, such as gas taxes and transit fares. The rationale for value capture is based on the relationship between transportation networks and urban land value. [See diagram.]

Investment in transportation infrastructure — ranging from new roads and freeway interchanges to light rail lines and transit stops — improves accessibility to desirable locations such as jobs, shopping and entertainment. Property thus made more accessible tends to become more valuable. Developers and landowners benefit from this higher land value.

Value capture mechanisms seek to harvest a payback from the value created by the public investment. The revenue is then directed to pay off the improvements or finance new ones.

The study is quite lucid in spelling out the pros and cons of eight potential value capture approaches based on four criteria — economic efficiency, equity, sustainability, and perhaps most important for the Legislature, feasibility.

It will come as no surprise to students of tax policy that the most feasible measures have relatively low visibility to general taxpayers.

Perhaps the most intriguing of the eight approaches is Transportation Utility Fees (TUFs). TUFs treat transportation networks like other utilities and can be based on factors related to transportation demand, such as parking, square footage or type of facility. They are simple to administer and generate a stable revenue stream. But, as with any new "fee," there are drawbacks to getting them authorized in the first place.

The 12-page policy summary, "Harnessing Value for Transportation Investment," is worth a look by anyone interested in finding new ways to raise money for transportation. [Download Policy Summary]

— Charlie Quimby

Hollowing out the public sector affects public safety

Our continuing and increasingly dubious experiment with starving the public sector in Minnesota is producing almost daily reports of questionable budget cuts.   A Star Tribune front-page story on disappearing lifeguards at public beaches is the latest manifestation of our increasingly penurious fiscal policy.    Anti-government conservatives like to claim that much or most of government investment is unnecesssary or superfluous, and that all we really need are military forces, courts and police to protect property.   But it turns out that a relentless ratcheting down of public investment affects public safety in myriad ways:  crumbling bridges, less attention to mesothelioma incidence in northern Minnesota miners, Local Government Aid cuts that force police and emergency service layoffs, hospital reimbursement cuts that hamper emergency rooms in the midst of an ongoing swine flu pandemic, and on and on.    Public safety is a primary responsibility of our entirely legitimate and mostly effective state-and-local government systems.    Most of the things those governments do eventually have something to do with public safety and providing for the "General Welfare," an often overlooked primary goal that is spelled out in the United States Constitution.    And these systems can't be funded without fair and ample tax revenues.

Dane Smith

Safe bike travel offers lessons in infrastructure

The Star Tribune editorial, "Don't let thugs derail bike trail use," is right in spirit. But in response to a rash of muggings along the popular central bikeway, it makes an array of suggestions — better lighting, increased police presence, night-vision security cameras, citizen bike patrols and avoiding riding alone — that miss a larger point about safe infrastructure and its use by the public.

Safety strategies that rely on counter-measures and modified user behavior represent a design failure. And a purely engineering- or cost-driven approach to infrastructure almost guarantees we will end up with issues later.

The editorial notes that "portions of the greenway and Hiawatha trails are more dangerous because of the surrounding geography and inadequate lighting."

Another way of putting it would be: The danger comes from treating commuting purely as a problem of moving most efficiently from point-to-point. The trail fails to recognize its true connections to the surrounding city.

The trails are more dangerous because they were built like roadways and rail lines — for specialized vehicle use through a featureless trench or concrete wasteland — rather than as human-scaled outdoor passageways that naturally connect people and destinations. This problem "geography" along Hiawatha was created decades ago by scrubbing the landscape of trees, residences and commercial buildings so it could be remade as a transportation corridor. Then the entire area was neglected until recently.

Don't get me wrong. I love the Midtown Greenway and use it at all times and seasons. The designers and community advocates who championed the trail were well aware of its challenges, and they incorporated features to mitigate problems with the location. It will only get better as more community connections are made and more people discover it.

But here's what real safety looks like along a bike trail or city street.

We can design our infrastructure like parking ramps and equip them with cameras, emergency phones and occasional patrols. Or we can emulate our parks and most beloved commercial streets — places that encourage a mix of activities and promote gathering, visibility and access year-round.

Reaching our destination safely and efficiently is indeed important, but we ignore the quality of the journey at our peril.

— Charlie Quimby

Met Council looks beyond roads to cope with congestion

Good news: The Metropolitan Council and its transportation planning staff take a realistic view that the Twin Cities area cannot just build its way out of traffic congestion.

The draft version of the Met Council’s 2030 Transportation Policy Plan Update recognizes that many metro area drivers see congestion as a serious problem. However building our way out of congestion by expanding our highways is arguably not the solution but a part of the problem. Says the draft summary, “Instead of providing reserve capacity for decades, new highway lanes can fill up in a matter of months.”

And it’s worth keeping in mind, as we battle with congestion, that the Met Council’s 2005 transportation planning documents found the Twin Cities region to have the second shortest travel time to work among the 25 largest metropolitan areas in the country, based on Census 2000 data.

Given limited resources and the high costs of congestion, the draft TPP says, the metro area needs to pursue alternatives to congested travel, including better use of existing lanes and right-of-ways and better transit. But transit — as well as walking and biking — is more than just a solution to congestion for rush-hour travelers. Alternative modes of travel are important in their own right for providing affordable transportation and access to destinations for all citizens of the Twin Cities region.

Various organizations, including the St. Paul Chamber of Commerce, have raised concerns about the limited East Metro transit corridors and options included in the plan and how that might affect future development in the area. The Met Council’s analysis of congestion and construction comes in a broad-reaching, draft TPP that focuses on mobility in the region and lays out actions the Met Council might take to preserve, improve and expand the region’s transportation system in the context of land use.

The draft TPP recognizes the importance of more compact land use but, unfortunately, only goes as far as offering encouragement in that direction. Using less land for development and transportation could help solve congestion problems because that would reduce the vehicle miles traveled.

A coalition of four transportation and environmental groups recently issued a response to the Met Council’s draft TPP, calling for bolder visions and action and saying, more specifically, that the transportation plan lacks measurable outcomes, fails to identify adequate funding to support its goal of doubling transit ridership by 2030, gives too little attention to bicycling and walking, lacks clarity regarding highway prioritization, and lacks commitment to strategies that will advance more transit-supportive land use.

The Met Council’s draft TPP deserves praise for its suggestion that we can’t build our way out of congestion. However, if we are to reduce traffic congestion and develop a truly integrated, metro-wide transportation system, bolder visions and actions are needed. The Met Council will accept comments on the draft TPP until 5 p.m. on November 6 via its website.

— Skye Stauffer, Growth & Justice intern, and Matt Kane

Moving toward more sustainable, efficient and affordable transportation

Next year Congress is slated to take critical action on federal legislation that will shape most of the nation’s transportation system for years to come — action that could steer our nation toward more sustainable, efficient and affordable transportation. 

Congressional reauthorization of this surface transportation legislation presents an excellent opportunity for smart thinking about how best to invest public sector dollars in ways that spur growth and expand economic prosperity for all Americans, right in keeping with the Growth & Justice philosophy. 

A national coalition called Transportation for America (T4America) issued an ambitious call this month for a federal transportation package that deals with transportation challenges and policies in a broader context of important national policy issues, including economic opportunity, climate change, energy security, health, housing and community development.

T4America’s brief, five-point platform [download pdf] points out the national economy depends upon our network of roads, rails, transit lines and pathways but notes, too, that the transportation network is in disrepair and offers too few affordable, efficient and convenient options to too few Americans.

The five points from T4America are sensible enough: Modernize and expand the nation’s transit and rail network to reduce our dependence on oil and to better connect metro regions.

• Modernize and expand the nation’s transit and rail network to reduce our dependence on oil and to better connect metro regions.
• Invest in cleaner, greener modes of transportation, including transit, bikeways and walkways.
• Invest in and restore existing highways, bridges and transit systems before building new roads that will require more public dollars for maintenance and repair.
• Stop wasteful spending on federally funded projects that offer little in the way of economic return and on projects that increase our dependence on oil.
• Offer more affordable and efficient transportation options to help Americans avoid traffic congestion and high gas costs, and promote housing options that match well with new possibilities offered by the evolving transportation system.
  

T4America says these policy pathways will benefit the nation by reducing the transportation costs for American families, creating jobs, reducing our dependence on oil, helping communities cope with traffic congestion, reducing the carbon emissions that contribute to climate change, and restoring neighborhoods that retain their value as places because of their transportation networks and their access to job sites.

Congress would be wise to consider the T4America platform as it begins work on the federal transportation package that will lay out specifics for the next six years of investments, policies and choices regarding highways, bridges, transit, safety, and bike and pedestrian routes. 

The ideas in the platform undoubtedly will get fair airing from Minnesota Congressman Jim Oberstar as he leads the federal reauthorization effort from his position as chair of the U.S. House’s Committee on Transportation and Infrastructure.  Good thing.

— Matt Kane

Congestion is only the symptom: More conversation with the Civic Caucus

This is the second part of my conversation with members of the non-partisan Civic Caucus about transportation issues facing Minnesota [here's part one]. I don't normally refer to myself in the third person, but the Caucus's report was so clear and concise, I've simply used their words, adding my own headings.

Reducing congestion involves a wide range of issues and potential approaches.

A Civic Caucus member said that large numbers of people in the metro area remain deeply concerned over sitting in traffic. Kane acknowledged that congestion is an important issue, politically and in terms of quality of life. He said that the metro area needs a wider range of options for getting to where they need to go and that land use matters, too, in terms of where people live vis-a-vis where they work. 

Kane said that the use of pricing mechanisms to encourage drivers to seek lower cost alternatives has appeal. He noted that the forthcoming changes to the 35W corridor under the federal-state-local Urban Partnership Agreement will provide valuable insights into a variety of transportation options, including congestion pricing, traffic management strategies, and transit structured to offer riders clear advantages over driving.

It will become more important in coming years, he said, to move to a different approach —other than the gasoline tax and vehicle license fees — to paying for the cost of roads. Growth & Justice favors tapping into income tax revenues. Another approach, he said, would be to charge motorists based on vehicles miles traveled, perhaps varying the rate based on when, where, and how far a trip occurs. In response to a question, Kane said he is not opposed to considering a parking tax, too.

But congestion is a reflection of a strong economy, so reducing it might not be the right goal.

Having a vibrant economy such as in the Twin Cities area inevitably produces congestion, Kane said. We'd not want to reduce economic activity as a way to ease congestion. Getting rid of congestion isn't the right goal, he said. A better definition of the goal would be providing access to destinations for people.

The upcoming Central Corridor LRT line connecting the downtowns of Minneapolis and St. Paul isn't so much designed to ease congestion as it is to assure access for people, he said.  Projections indicate that buses won't be able to accommodate all demand in the corridor in future years, he said. As part of a more complete transit system and an expanded LRT network, the line will allow more people to move in less congestion.

Light rail is but one element of that comprehensive system, he said. The flexibility of buses and their lower upfront costs make them a critical part of the plan. We need to keep in mind both costs and who is served when exploring transit modes.

He noted that major rapid bus service will shortly be added to I-35 and to Cedar Avenue south from Minneapolis well into Dakota County.   

Suburban destinations are difficult to serve because transit requires density — of either jobs or residents.

A Civic Caucus member noted that much more attention is given to transit service for the downtowns, where not more than 15 percent of the region's jobs are located, rather than to suburban destinations. Kane replied that mass transit requires a high density of jobs at the destination end in order to be fiscally viable. The downtowns have vastly higher densities of jobs than does any suburban destination.   

A member commented that perhaps more innovative approaches — than a corridor approach — are needed in designing suburban transit service.  Kane responded that it is difficult to design a system to well serve potential transit users in locations with low densities for housing and low concentrations of jobs, but innovative approaches would be welcome.

Expenses, subsidy levels and decision-making authority vary between transportation modes.

LRT has larger up-front capital expense, but lower operating expense than buses, Kane said.  LRT has fewer drivers, fewer vehicles, and uses electricity, not petroleum, for fuel. In terms of dollar amounts, although not percentages, express buses that operate non-stop from suburbs to the downtowns require a more subsidy than local buses that pick up and discharge passengers every block, he said. 

Kane acknowledged that tensions will exist between the Metropolitan Council and the metro counties over use of the new county-based transit tax.  The counties are not as anxious to use those funds for operating subsidies as is the Metropolitan Council.

Asked whether rail and highway decision-making will occur in the same governmental body, Kane replied that decisions need to be very well coordinated, but one has to recognize the practical difficulties, in light of legislative action. 

More and different transportation funding is needed.

Kane characterized the work of the 2008 Legislature as a down payment on catching up on a transportation backlog. To the extent that gas taxes fade in the future as an effective source of transportation revenues, we likely will need to look at variety of sources to produce the adequate income stream, he said. 

Growth & Justice believes that to secure additional public funds for investments in transportation and education, Minnesota should look to income tax increases targeted toward higher income earners. Kane cited the Minnesota Department of Revenue’s 2007 Minnesota Tax Incidence Study, which shows that for combined state and local taxes, state residents earning the most pay a smaller share of their income in taxes than those in the middle-income range.

Specifically, earners in the top income category pay 10.9 percent of their income in state and local taxes, while those in the fourth through ninth categories pay 11.5 to 12.3 percent. [Note: The gap is even more pronounced at the top 5 and first percentiles, at 10.5 and 9.6 percent, respectively.] Kane said that state and local taxes as a percentage of total income in Minnesota have declined since the 1990s.

— Matt Kane

Managing transit: A conversation with the Civic Caucus

In June I met with members of the Civic Caucus to discuss ongoing, major transportation issues in Minnesota. The non-partisan Civic Caucus, described as “a Minnesota e-group of senior policy wonks,” convenes once a week to engage in dialog on public issues and surface creative proposals for change.

This post is based on their report of our discussion. A second post will address congestion, suburbs vs.cities and other issues they raised.

The divided metro transit structure is a practical accommodation to reality.

Commenting on divided transit authority between the Metropolitan Council and county governments in the metro area, Kane said the arrangement is a practical accommodation to reality. A new quarter-cent sales tax for transit is, by law, being imposed by county governments, not the Metropolitan Council.  It is somewhat unrealistic to put the county commissioners on the hook for raising the funds and expect them to hand off decision-making authority to another government entity. 

Thus, the counties are empowered to decide how the new tax money will be distributed, consistent with the Metropolitan Council's policy plan. In the best of all worlds, you'd probably place more authority in the Council, but we have to be practical, he said. Moreover, many legislators consider the Council to be too closely tied to the Governor, because all Council members are appointed by the Governor to terms that are co-terminus with the Governor.

Growth & Justice is not a fan of the sales tax, Kane said, because it hits lower income persons disproportionately.   

Minnesota transportation funds have been distributed as “entitlements,” rather than according to need. Fairness and accountability are likely to improve.

It was noted that several weeks ago, Ken Orski, a national transportation consultant, was critical of the way transportation funds are distributed in Minnesota. Orski's concern was that the funds are largely distributed to different levels of government according to statutory or constitutional formulas that bear little relationship to need.  In effect, Orski said, the funds are "entitlements" for various levels of government.

Kane noted that the 2008 Legislature changed a formula for distribution of funds among counties to give greater account to transportation needs, not just an automatic distribution among counties, irrespective of needs. He also said that the Legislature has an interest in assuring that all parts of the state are treated equitably in distribution of revenue.

There are good reasons to place authority for transportation at the metro level as well as the state level.

A Civic Caucus member inquired whether more leadership and planning responsibility ought to exist at the state level, because of the critical role that transportation plays in the overall economy of the state.

Kane agreed that a statewide transportation system allows the safe and easy movement of people and goods.  It makes places accessible to people. And it lays the base for business activity that fosters economic prosperity. Commerce needs roads, and businesses incur costs from congestion delays and poor road conditions.  Wise investments in transportation infrastructure help put Minnesota’s households in a better position to benefit from economic growth. And a high-quality transportation system makes for faster commutes, reduced delays, fewer accidents, less fuel consumption and better air quality.

He noted, however, that it is useful to place some authority at the metro level, instead of with the state, because experience nationally has shown that metro-level decision makers are more likely to explore a variety of options for dealing with the much more complex transportation problem in the metro area, and more likely, too, to consider transit as a viable option. Because of the much larger number of trips and the accompanying congestion in the metro, investments in transit are important.

— Matt Kane