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International Partnership Meeting Thursday , January 17, 2013 Washington D.C.

International Partnership Meeting Thursday , January 17, 2013 Washington D.C. Purpose. Governor established TFAC one year ago

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International Partnership Meeting Thursday , January 17, 2013 Washington D.C.

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  1. International Partnership Meeting Thursday, January 17, 2013 Washington D.C.

  2. Purpose • Governor established TFAC one year ago • Seeking bold recommendations to reverse the decline of the state’s highways, roads, bridges and public transport systems as well as air, rail and port facilities for the next 20 years • Appointed diverse committee • Consider • Quality of Life • Economically competitive in the global economy • Current and future potential revenue sources • Traditional and non-traditional approaches • Opportunities for public-private partnerships to invest in transportation

  3. Committee ConsideredThree Funding/Financing • Status quo • Maintaining current performance • *Economically competitive / world class transportation system: means a sustainable, globally competitive, technologically innovative system that provides the foundation for a sound economic environment and a high quality of life

  4. Process Approach • Mapped out 11 meetings • Analyzed information • System condition and trends • Needs and funding gap to meet scenarios • Funding and financing options • Funding and financing principles • Considered traditional and non-traditional funding and financing options • Developed recommendations • Forged draft recommendations in Oct. and Nov. • 13recommendations advanced on December 1st • Develop marketing plan (underway)

  5. Conditions and Trends • Social-Demographics • Size of system • Aging infrastructure • Cost of congestion • Safety • Energy costs • Construction Inflation • Growing global economy • New Normal is uncertainty

  6. INFLATION

  7. Twenty Year Funding Needs to Achieve Desired Outcomes(20 Year Needs in $ billions; 10-31-12) AFG = Annual Funding Gap

  8. Conclusions about Minnesota’s Transportation System • Critically important component of state’s economy • Funding for this system in the future faces declining revenues • To maintain its competitive advantage, significant additional revenue will be needed • All transportation authorities we will have to work smarter by doing more with the existing resources

  9. Conclusions cont. • Must continue and enhance the delivery of high return-on-investment and cost effective strategies • Must address funding gap with investment framework that is sustainable and equitable • Partnership may be needed to provide the infrastructure for economic success • Investment in transportation should be a top priority for the state of Minnesota in context of economic development and tax reform, and overall competitiveness

  10. TFAC High Level Funding and Financing Principles • High Return-on-Investment • Economic Efficiency • Job Growth and Economic Development • Transparency • Quality of Life • Equitable • Strategic • Balance Market and Public Roles • Safety • Reliable and Sustainable

  11. Recommendations 1.System-Wide Revenue Options for Roads: registration fees; motor fuel tax increase; indexing 2. Transit-Dedicated Sales Tax Options: ½ cent sales tax in metro area; leased vehicle sales tax dedicated to rural transit systems 3. Local Government Revenue Options: greater flexibility for local governments to raise revenue 4. Project-Level Revenue Options: tolling, P3s, Value Capture, monetizing assets, general obligation bonding

  12. For more information contact: Ken Buckeye, TFAC Project Manager Office of Policy Analysis Research and Innovation ph. 651.366.3737 kenneth.buckeye@state.mn.us

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