Georgia leaders debate road tax

CALHOUN, Ga. -- Georgia transportation officials say they need a 1 percent sales tax to fund road projects, so lawmakers are asking residents to decide whether they want to be taxed.

Local leaders like the idea of more road funding but voiced concerns Tuesday that the one-penny tax on a dollar purchase would compete with special local option sales taxes, also known as SPLOST.

Speaking to the Northwest Georgia Regional Commission this week, Todd Long, director of planning with the Georgia Department of Transportation, made his case for the funding system created by House Bill 277, saying the tax could raise as much as $1.58 billion annually for road projects.

Under the law, approved earlier this year, voters across the state will vote whether to approve the 10-year tax in August 2012.

The law sets up a region-based system, meaning money collected in each region would stay in the local area. It also means voters in each region of the state will make the decision on the tax for themselves, regardless of what other regions decide.

Initial estimates show that such a tax could bring in $120.7 million annually to the 15-county Northwest Georgia region, according to the GDOT. A regional "roundtable" with representatives from each county would manage the funding and decide which projects would be given green lights.

Long and state Sen. Jeff Mullis, R-Chickamauga, chairman of the Senate Transportation Committee, said the tax is necessary because fuel tax revenue -- where the bulk of GDOT money is generated -- has declined in recent years.

As the price of gas has risen, Georgia drivers have figured out ways to be more fuel efficient. As a result, less tax revenue is being collected, according to Mullis. Gas tax revenues have been as high as $1.02 billion annually but have slumped to about $850 million recently, according to officials.

Most officials said they understood the proposed tax and like the fact that, under the proposal, counties and cities would directly control one-quarter of the money. But several had questions about the new system and voiced concerns that voters might decide to pick between special local option sales taxes and the transportation tax.

At Tuesday's meeting, Dalton Mayor David Pennington had the most scathing remarks about the tax, calling the legislation potentially the "largest tax increase in Georgia history" based on the overall amount it would raise.

"I don't see how the Georgia economy can handle any more taxes," the mayor said.

He also compared the bill to the federal health care reform package, saying that state lawmakers shared the same mindset as Congress by saying the bill isn't perfect but is "the only thing we could pass."

After the Northwest Georgia Regional Commission meeting, Dade County Executive Ted Rumley and Chattooga County Commissioner Jason Winters both said the tax would help their county but worried about a stipulation in the bill that reduced the amount of state funding if the sales tax failed.

Mullis said that state matching funds on some projects would be a 50-50 state-local blend if the tax passes, but would fall to a 30-70 mix if the voters did not approve the tax.

The senator explained that the new law set up the matching funds so counties could use the money for engineering and site prep work rather than just construction, which the current system dictates. In the end, even if voters don't pass the tax, the counties should come out even, Mullis said.

Some at the meeting were not convinced.

"That seems like coercion at best and at worst another word that maybe I shouldn't use," said Gilmer County Commission Chairman Mark Chastain.

Chastain also said the legislation was "disingenuous" because it put the tax decision on voters so when it came time for re-election, the lawmakers could say they didn't raise taxes.

Whitfield County Commission Chairman Mike Babb said he worries that the new bill might not fix anything if voters don't go along.

"My concern is that it's going to be 2012 and the citizens are going to say, 'Thanks, but no thanks,'" Babb said. "We're going to be further down the path with still nothing solved."

Upcoming Events