Sustainable Georgia: Filling Up The Tank

A transportation bill, HB 170, was introduced in January, and there’s been much debate over how to find transportation funding. The bill follows a study and report by the State Senate and House that gave tax-policy wonks a lot to chew on. The report did a good job of explaining Georgia’s transportation problems – our current funding structure leaves a $74-billion “funding gap” over the next 20 years – and outlining the need for a minimum of $1 billion to $1.5 billion each year dedicated to transportation funding. 

As they say on the London Underground, “mind the gap” – that $74-billion hole would lead to 30 percent to 50 percent additional cuts to MARTA, managed lanes would lack funding and  the existing infrastructure would deteriorate. 

While the report didn’t make funding recommendations, it listed some options, including committing Georgia’s fourth sales tax penny to transportation as intended, which would raise $185 million annually; raising the motor fuel tax by 10 cents, which would raise $600 million; converting the 4 percent sales tax on fuel to a 25 cent per gallon excise tax; and adding a penny to the state tax to raise $1.4 billion.

These and other measures would get us over $2 billion, adequate but short of the $5.4 billion “whole enchilada” needed to remain competitive with peer states like Florida and Virginia.

Nowhere in the report is T-SPLOST mentioned, though that has become a proven way for local regions to band together and ramp up their own infrastructure. Legislators from areas that passed the 2012 T-SPLOST, however, are already balking at the idea of paying an additional statewide penny tax. A statewide or other T-SPLOST isn’t a long-term answer anyway, as it comes with an expiration date. 

True state transportation funding reform on the scale needed to address a federal-funding shortfall of some $70 billion a year has to be something permanent, something that will maintain the additional infrastructure we’ll need for generations, not just a decade. Legislators can’t force regions to vote on something (especially when so many of them campaigned against it), but the T-SPLOST shouldn’t be ruled out of a solution. New legislation could allow for redrawn districts and create fractional penny tax options for counties.

Another of the report’s recommendations is to stick alternative fuel vehicles with annual road usage fees in conjunction with annual registration – $200 for noncommercial and $300 for commercial vehicles. I understand that alternative fuel vehicles should have to pay for the infrastructure they use and not freeload on what’s being paid for with gasoline vehicle taxes. But it feels like a slap on the wrist for doing a good deed, and it won’t be an easy pill for our business community. Georgia has a plethora of logistics companies, many of which (such as UPS) use alternative fuel fleets.

This new fee could staunch a logistics bonanza that’s been building in response to the Savannah Harbor Expansion Project to accommodate new, larger ships. An alternative to annual road usage fees is a user mile fee system based on how much a vehicle travels. This system has proven successful in other countries, and if implemented in the U.S. could pay for infrastructure and reduce our deficit by $312 billion over 10 years, according to The Brookings Institution. I’m not saying it would be an easy sell, but it seems more fair. 

There is a lot of good to the report – particularly in regard to transit. The report not only recommends lifting the required 50/50 split for capital and operations expenditures from MARTA, but also recommends new toll lanes and managed lane networks and establishing a separate and permanent funding stream for the state’s 128 transit systems.

It’s clear Georgia must take an “anything goes” approach that will require compromises for our many stakeholders and communities, as the introduction of HB 170 has proved. That bill proposes to address our transportation funding needs without raising taxes – a statement some  have called sleight of hand. It calls for converting state and local sales taxes on gasoline to a 29.2 cents per gallon excise tax; charging the fee mentioned in the report to drivers of alternative-fuel vehicles; and $100 million in bond financing.  

It’s a start. While I believe Georgians would support a tax if it is fair and inclusive, with this bill perhaps we can begin to untangle the snarl that has become the status quo. Let’s hope legislators can come together and find something to keep us in the game and stifle the road rage holding us back.