For the first time in Georgia’s history, a proposed transportation plan in the legislature includes dedicated funding for transit.
The AJC reports this morning that Georgia House Republicans will unveil a $1 billion transportation plan, with a focus on “critical road and bridge improvements”, but also $100 million annually dedicated to transit. Details as to how the funding will be allocated have yet to be unveiled.
Up until the present day, the state’s largest transit agency – MARTA – has subsisted solely on a gas tax, which ebbs and flows with the price of gasoline. It is the only large city transit system in the country with no dedicated funding.
The plan also moves Georgia completely away from a gas sales tax model to fund transportation. The AJC states…
The plan, which will be introduced as legislation Thursday, would shift the state completely away from a sales tax on gas to a 29.2 cents per gallon excise tax. It would eventually end the local sales tax on gas, while allowing counties and cities to levy their own excise tax.
One detail of the plan revealed is that electric and alternative-fuel vehicles would pay an annual $200 “user fee”, which will be set aside to fund public transit.
More details as we learn them.
Photo courtesy of Wikipedia
This is how republican lawmakers get away with saying they “support transit”? By implementing a fee on less than one tenth of one percent of drivers, and generating $7M in the process? That’s a rounding error in the state transportation budget. We are about to spend $25M on the plane train at the airport, and we think $7M a year is going to make a dent in any meaningful transit initiative? Even if the number of EV’s on the road doubles or triples in 5 years . . . we still are not talking about the kinds of dollars required to make large capital investments.
The article mentions that $100 million of the budget will be set aside for transit. The $7 million is just the amount projected to be generated from the EV usage fee.
That $100M is a bond issue, not revenue. It’s a one-time shot. $100M is something, sure, but in terms of regional transportation it’s not much. That’s what was spent on a two-mile streetcar loop. It sounds like a huge number . . . but Decatur is about to spend the same amount to renovate and expand two school facilities on land they already own.
The article states that the number is $100 million PER YEAR.
http://data1.whicdn.com/images/132327886/original.jpg
DM states $100M per year, not the AJC. There won’t be annual bonds, so I think it is $100M total, with the $7M user fees being used to service the debt.
Ah, thanks. I see what I did. Sorry, these things get tricksy.
So the “dedicated annual funding for transit” is just the pittance raised by the fee on non-gas cars? This proposal sounds much less impressive now.
You are correct.
Yeah . . . see my point? Even if EV’s double or triple in the next 5 years, we are talking what . . . $20M? In terms of shovels in the ground, that does not go very far to fixing transit issues.
But the possibility that local governments can use gas tax revenue for transit projects could have an impact, so I’m not ready to dismiss this bill yet. It could be that we get some of what TSPLOST (which would have passed in Fulton and DeKalb) would have provided but with a better project mix.
If a TSPLOST type fund in Fulton and DeKalb alone would generate enough money to fix/improve/expand public transit, it would have already happened. Further, this isn’t an either/or scenario. Both roads and transit need to be addressed in a comprehensive manner.
“Further, this isn’t an either/or scenario. Both roads and transit need to be addressed in a comprehensive manner.”
I’m supposing, though, that more local control would lead to a higher % of revenues around here going toward transit than the % that was in the TSPLOST plan. Don’t know how it would compare in absolute dollars ( much less I’m sure), but it would be a predictable, ongoing source of revenue at least. What other counties and cities do is another matter.
Wow ! $200 per alternative fuel vehicle ! Hybrids are not included. Even with the large number of Leafs running around, $200 per is a very small number. Good “getting of the bus” for the legislators, but meaningless in the big picture.
I would wager the “useage fee” of $200 per year on a vehicle that can realistically travel about 10,000 miles per year works out to a lot higher per mile rate than someone with a car getting 30 MPG who puts twice the wear and tear on roads.
“I would wager the “useage fee” of $200 per year on a vehicle that can realistically travel about 10,000 miles per year works out to a lot higher per mile rate than someone with a car getting 30 MPG who puts twice the wear and tear on roads.”
According to one of the AJC articles, the fee works out to an equivalent in gas tax of 13.2 gallons of gas a week. Though it’s pretty clear this “hipster fee” is meant to appease a certain segment of the Republican base, it is hard to argue against the idea these vehicle owners shouldn’t pay something for their road usage.
“it is hard to argue against the idea these vehicle owners shouldn’t pay something for their road usage”.
I don’t think anybody is arguing that. But, you know who else pays ZERO federal fuel taxes, and is also exempt from the 1% state fuel taxes? Every state agency.
Of course if the state agencies were taxed, the state agencies actually wouldn’t actually pay the tax. Taxpayers would. The state would be collecting taxes to pay taxes due by state agencies.
This is also a continuation of the Gold Dome’s efforts to yank funding away from local governments and then congratulate themselves on cutting taxes. I haven’t read the particulars on the sales tax vs. excise tax switch, but local governments are still hurting from the Great Recession. I don’t know if all local governments would replace the sales tax with an excise tax, but lost revenue will be made up somewhere or we’ll get less services or higher property taxes.
If the new funding model creates more GDOT funds for local governments to use for maintenance, then maybe it works out. Under the current model, DeKalb has very little resources for maintenance and there are so many roads, sidewalks, bridges, etc. that are in very poor condition.
“I don’t know if all local governments would replace the sales tax with an excise tax,”
Why wouldn’t they?
One reason they wouldn’t: A SPLOST would need voter approval.
A future SPLOST would (and could not be applied to fuel), but I didn’t get from the proposal that switching to the excise tax would require voter approval.
I stand corrected. The excise tax would need local voter approval.
bizjournals.com/atlanta/blog/capitol_vision/2015/01/georgia-house-leaders-unveil-transportation.html
Exactly. Siphon off voter approved taxes to the state level, remove a revenue stream from localities, and then force them to vote for more tax increases. Lawmakers get to say “we never raised taxes! you VOTED to raise them”.
That’s a fair point.
To add to King Joffreys point, it seems that part of the strategy is to re-route money to transportation-which voters rejected last year– from schools, taxes for which voters are more likely to vote for if needed to recoup the loss of gas tax revenue.
I stand uncorrected, maybe. According to this article, local governments can add up to 3 cents per gallon (for transportation funding only) without a referendum. Anything beyond 3 cents would require voter approval. It’s almost a certainty that DeKalb, Fulton, Atlanta, and Decatur governments would elect to do this.
peachpundit.com/2015/01/28/georgia-house-leadership-releases-transportation-funding-plan/
“Up until the present day, the state’s largest transit agency – MARTA – has subsisted solely on a gas tax, which ebbs and flows with the price of gasoline.”
MARTA doesn’t get any funding from the gas tax. By law the gas tax can only fund roads.
Obviously most of the details of this plan aren’t public yet, but the article just posted on the AJC (re: the Tea Party response) is interesting/concerning. According to the article, this bill would shift tax dollars from local school boards to the state, and would be especially punitive to school districts with a higher proportion of residential.
I think most [educated] people in this state recognize the need for transportation and transit funding. Why doesn’t someone have the b*lls to just stand up and propose increasing taxes (regardless of whether you call it a user fee, fare, etc.)? GA’s transportation/transit funding is lagging behind pretty much everywhere else.
But, there are some positives to this proposal. 1) It is a comprehensive/statewide plan. 2) Transit is included. 3) It implements user fees for electric vehicles (Leaf owners already basically have a free car due to a series of bad policy decisions. They should at least contribute to maintaining the roads). The good news is that transportation/transit funding is already back on the table despite the lopsided defeat of T-Splost a couple of years ago.
“According to the article, this bill would shift tax dollars from local school boards to the state, and would be especially punitive to school districts with a higher proportion of residential.”
“Why doesn’t someone have the b*lls to just stand up and propose increasing taxes (regardless of whether you call it a user fee, fare, etc.)?”
Agreed, but this is true at the local level too; places like Decatur will have to be willing to accept higher property tax rates (or find ways to enhance the digest) if they want to have high quality schools.
Damn good, DawgFan. You said it all right there.
I think hell just froze over. 🙂
I too am surprised to see DF calling for a tax increase. He’s going soft, apparently. 🙂
Because he perceives it as a tax against liberals, perhaps?
Actually, I think the opposite is true. Those who don’t own cars (liberals) would pay less of the tax.
Who says they don’t own cars? I mean, who among us does not know at least one professed environmentalist who drives absolutely everywhere?
You only know one?
Getting old I guess. Actually, I view this as a necessary investment more so than a tax. I am electing to not think about the fact that a not insignificant portion of these funds will be wasted by government bureaucracy, corruption and incompetence.
By “this”, I don’t mean this particular proposal. I mean funding for transportation and transit.
If metro Atlanta and Georgia’s leaders had vision………and guts…..
http://uk.businessinsider.com/images-of-londons-crossrail-2014-12#crossrail-is-a-new-network-of-railway-lines-train-tunnels-and-stations-that-will-make-getting-around-london-much-easier-and-faster-1
The article you mention is actually more informative than the main one. Another positive, if I’m understanding the article correctly, is that localities would be able to use their portion of the proposed fuel excise tax for transit if they wanted.
This is a bad start. There is no significant funding for transit. The $100 million bond isn’t a dent in transit. And the user fees on electric cars couldn’t fund a major engineering study. $100 million is not enough for one MARTA station! Worse that $100 Million also goes for bridges and other non-transit projects. Finally, the entire size of the program is not enough to fix the highway program.
Sorry, but I have to disagree. With this bill, REPUBLICAN leaders are supporting a tax for TRANSIT. This is the closest you have ever been to getting what you wanted. Seems like you should view this as a great start.
“This is a bad start.”
I’d say it’s a start since there is currently no state funding for transit. And I like the potential of local governments being able to use being able to use their portion of the gas excise tax for transportation, which could include bike lanes, transit, etc.
Anyone know how much of Decatur’s SPLOST comes from the gas sales tax? So few gas stations around here it doesn’t seem like it would be much.
I’ve asked the City. But that’s a decent point.
If a gas station gets turned into a restaurant, do we get to claim extra revenue from that? Because then Decatur’s coffers would be overflowing.
I thought we get a percentage of Dekalb’s take so it’s not based on sales within the city limits
A quick summary of what would change under this proposal. Someone correct me if I’m missing something.
1. $100 million a year in state funding for transit, from bond issues.
2. All gas taxed on a per gallon basis (which is apparently a net increase in the gas tax, claims aside).
3. No future SPLOSTS can include the gas tax as part of the revenue base.
4. Local voters will have to approve additional tax on gas, up to three cents per gallon, which can be used only for transportation funding.
5. A $200 annual fee on non-gas vehicles.
The bond issue is not specifically for transit. If it were, the asphalt-centric legislature would never agree to it.
I have never really understood why we can’t tax gas the way we tax other things we sell: as a percentage of the sale price.
Primarily because the price of gas fluctuates wildly over a short period of time. Quick example – a 10% sales tax on $2 a gallon gas gets you $.20, and on $4 a gallon gas gets you $.40. Makes budgeting for transportation projects (which is what most gas taxes are used for and which, by their nature, tend to be multi-year) nearly impossible. Imagine the screaming if a road project stopped halfway because the price of gas dropped and it couldn’t be funded any longer. Putting aside other issues, an excise tax is at least a consistent and projectable source of funds.
But apparently it can almost never be changed.
I mean, what you say is correct but this applies to everything else that we collect sales tax for but gas tax somehow has to always remain very nearly the same in absolute terms and be a forever shrinking tax.
Supposedly, it’s being pegged to inflation, so the tax will increase each year so what happened with the federal highway fund does not happen here. Personally, I’m not a fan of the sleight-of-hand this represents, but I can understand wanting to go from a variable sales tax to something more projectable (leaving transit issues out of it).
The federal gas tax hasn’t been adjusted for inflation in over 20 years (not to mention the fact that fewer gallons of gas are being consumed per capita). At the state level, this proposed excise tax is supposed to be pegged to inflation. Then again, there have been two or three points at which the current gas tax was supposed to automatically increase, and Deal blocked it each time.
Not the motor fuel excise tax, but the “sales tax”, which really doesn’t float with the price of gas.
A Peter and Paul scenario (without Mary):http://jaybookman.blog.ajc.com/2015/01/29/howd-they-find-1-billion-with-no-tax-hike-hint-they-didnt/