Dade officials fret about Georgia bill to raise gasoline taxes

WILDWOOD, Ga. - Traveling on Interstate 24 last week, Phil Ferguson rolled up to a pump at the Pilot Flying J off exit 169 to stop, where an electronic sign advertised diesel fuel for $2.79 a gallon.

A gray bandanna around his head and a black cat on his abandoned driver's seat, Ferguson grabbed the handle of the diesel pump, popped the nozzle into the fuel tank and squeezed. While he watched the dollar counter climb, he was asked about Georgia's gas tax, set to change in three months.

Ferguson shrugged. He has crisscrossed the country for U.S. Xpress the last three years, but he doesn't know anything about Dade County. Neither does the driver parked to his left, from Alabama. Or the one to his right, from Texas.

Ten miles south, though, Dade County administrators sat in their offices, considering that gas tax change, the result of a transportation bill that passed the Georgia legislature Tuesday night. People here are worried prices will rise too high, pushing drivers like Ferguson away from their county.

Until the hike actually happens, they can only speculate.

"We're just kind of waiting it out to see," Commissioner Robert Goff said.

"The future is very much unknown," added Don Townsend, the county's chief financial officer.

House Bill 170 will increase funding for state transportation projects by $900 million a year. It was one of Georgia's most high-profile pieces of legislation this session. Along with health care and public education, Gov. Nathan Deal said during his State of the State address in January that transportation funding is a key to Georgia's future.

To raise the money, lawmakers added small fees for staying in hotels and driving electric cars. They also ended tax breaks for purchasing jet fuel. But in Dade County and elsewhere, the focus is on the impact to local gas stations.

Right now, the state charges a 7.5-cent excise (flat-fee) tax and a 4 percent sales tax on every gallon of gas and diesel sold. If Deal signs the transportation bill, the state sales tax will go away and the state will instead charge a flat fee: 26 cents a gallon on gasoline and 29 cents for diesel.

Add in federal tax and the 3 percent local sales tax, and a gallon of gas in Georgia will cost 8 cents more, at least at the current price of fuel. A gallon of diesel will cost 9 cents more.

For a tractor-trailer with a 150-gallon tank, that means an extra $13.50 every time its driver fills up in Dade County. Compared to the average price in Alabama, according to the American Petroleum Institute, truck drivers will spend an extra $33.40. Compared to Tennessee, an extra $40.30.

Dade County, a tiny sliver of Georgia squeezed between those two states, might become a toxic place to buy gas. Which means fewer truckers will stop there and local sales tax revenue will shrink.

Dade County officials might face a tough choice: Tax their residents more, or cut services more. They don't want to do either one again, not after they did both last year.

Motor fuel sales are so important here because the county doesn't have a major retailer like a Home Depot or Costco, which attract outside shoppers. Forty-one percent of Dade County's sales tax revenue comes from motor fuel purchases, the third-highest ratio of any jurisdiction in the state. Fuel sales account for 16 percent of the county's total revenue, property tax included.

Goff, Townsend and County Executive Ted Rumley are worried. Will truckers start to avoid their county?

"You can't put a dollar amount on that," Goff said. "You don't know who's not going to stop in your county."

He said he will monitor income for the next couple of years before drawing conclusions.

Back at the gas station, Ferguson said he doesn't think much about how much fuel costs because his bosses tell him where to stop.

"I didn't pick this place randomly," he said. "They sent me here. They'll send me some place out of the way when it's one-eighth of a cent cheaper."

Last summer, a crowd packed the Dade County Administrative Building, some spilling outside the doors for a public hearing on whether the Dade County Commission would raise property taxes by 44 percent. For seven years, the rate had fluctuated within a 2 percent margin. But now, Rumley said, the county had to charge its residents more.

The town lost several major employers over recent years. Then a series of tornadoes in April 2011 damaged 18 homes and destroyed dozens more. Tens of thousands of trees were blown down, uprooted and splintered. Two people died.

Townsend said the storms cost the county more than $3 million, about a third of its annual budget.

"We don't have $3 million," he said. "Are you kidding?"

The commission had to borrow money, and they had to start making payments on that money this year. As the commissioners discussed raising property taxes to cover those payments, residents threatened to vote them all out of office.

"Cut the waste!" one person said.

"You better have a good retirement plan!" said another.

The leaders listened. They told department heads to cut spending, leading to furloughs or layoffs for 42 employees. Then commissioners passed a 27 percent property tax increase.

OVERSET FOLLOWS:Rick Breeden, who had just joined the commission three months earlier, had not seen anything like those heated meetings.

For seven months, until Goff replaced him after a run-off election, Breeden learned a lot about local government and how to make decisions that would impact thousands of people.

He watched employees lose jobs. But he had also stared at the residents who hollered at the very idea of a property tax increase.

Last week, Breeden said he doesn't think the residents can take another property tax hike. He's worried, though.

"What they're proposing is going to kill this county," he said of the transportation bill. "It's going to kill it. It's going to put a burden on these property owners. They won't be able to stand it."

Townsend, the county's CFO, said every department has been trying to adjust this year. The sheriff's office did not replace three employees who left. The director of 911 services is working the radio at the same time he handles other administrative duties.

Sitting on his Grasshopper lawn mower in the middle of a soccer field Thursday, Stacy Stephens chatted with a contractor on his work phone. A couple months ago, some teenagers did donuts in the parking lot behind him. The driver lost control, crashing the vehicle into a fence.

Now Stephens, the county parks and recreation director, is getting the fence fixed. He hung up with the contractor as another call came in on his other phone: a cost estimate for hanging nets behind the baseball backstops.

Stephens has to maintain seven baseball and softball fields, two soccer fields, one football field, two playgrounds and four tennis courts. He also has to pick up the trash, clean the bathrooms and make sure the Coca-Cola machine is working.

Born and raised here, Stephens, 55, took the job about four years ago after construction work dried up during the recession.

He said he enjoys the work. He likes seeing people happy at a youth sporting event, watch the senior citizens who come to walk the fields - three, four miles at a time. They inspire him. Plus, he and his daughter get health insurance.

He has only one employee, and he's grateful even for that. Last summer he had to let go of all three of his workers. The county let him hire one back on a temporary basis earlier this year.

The county officials are working on their new budget right now. Stephens hopes he doesn't have to lay off his employee again.

Looking out at the 50 acres he manages, he admitted the grass is shaggier than it should be.

"It looks bad on me," he said. "I hate that. I don't want things looking bad on me. But I have to do what I can."

But the work is draining. Last summer, when the Dixie Youth Baseball league hosted a tournament here, he said he worked 92 hours.

"I can't do that every week," he said. "Nobody can."

Then Stephens got back to work. Baseball season started in March, and he needs to maintain the fields. He hopped back on the lawn mower.

He'll keep going until he runs out of fuel.

Contact staff writer Tyler Jett at tjett@timesfreepress.com or at 423-757-6476