Sales Taxes to Increase to Fund Public Transit

The dissolution of the CTIB is leading counties to raise their own sales tax rates.

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MINNEAPOLIS – Hennepin and Ramsey counties are both considering increases to their sales taxes in order to fund public transit projects.

Ramsey County plans to increase its sales tax from one-quarter of a percent, to one-half of a percent, reports the Pioneer Press. Currently the tax money goes to fund projects of the Counties Transit Improvement Board (CTIB). Once the CTIB disbands, revenue from the new tax rate will fund projects specific to Ramsey County.

County Commissioner Blake Huffman, also a candidate for the Republican nomination for governor, strongly opposes the tax increase. However, he will be out of town on vacation next week when the vote on the increase occurs. He expects it to pass with ease.

“I voted against it when we voted on it in March,” Huffman told the Pioneer Press. “Transportation tax is a regressive tax that really hits people hard, especially low-income people.”

In Hennepin County, a similar increase of one-quarter percent will also come to a vote next week. MPR reports that if approved the tax increase would go into effect on October 1.

Hennepin County Commissioner Peter McLaughlin told MPR the money is supposed to replace funding the state legislature declined to appropriate for transit projects in the area. The increase is expected to help pay for the Southwest and Bottineau light rail lines, the Orange bus rapid transit line on Interstate 35W, and the proposed Riverview corridor between St. Paul’s Union Depot and the Mall of America.

“We’ll be able to make our contribution to those [projects]. The capital contribution will eliminate the state’s 10 percent share, because that was slowing us down,” McLaughlin told MPR.

Currently there is a one-quarter percent sales tax imposed across the Minneapolis-St. Paul metropolitan area. With the dissolution of the CTIB, the individual counties are now increasing their own sales tax rates.

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