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Sales Tax No Way to Fund Transportation Projects



I recently detailed several of the problems with the dozen separate Transportation Special Purpose Local Option Sales Tax referenda that will take place across the state on July 31 (Column, “Plenty of reasons to worry about transportation tax proposal,” July 8). This column adds to those original assertions.


Unlike the opposition of some to the “Northeast Georgia Regional Transportation Referendum” on which Athens-Clarke County voters will cast their ballots, my disagreement does not concern the specifics of our particular special transportation district project list. Rather, I object to the provisions of the Transportation Investment Act of 2010 that authorized the statewide referenda in the first place.


My first area of contention is philosophical in nature. The preamble to each of the regional TSPLOST referenda notes that it “(p)rovides for local transportation projects to create jobs … .” Some opponents of the referenda have challenged the legality and appropriateness of this claim. Isn’t it interesting (and predictable) that anytime someone wants my tax money to fund a project, that project is invariably cast as creating jobs and stimulating economic development?


Perhaps some job creation and economic development will occur in certain ancillary circumstances, but even if one accepts the assertion that the construction phase of TSPLOST will “create” jobs, then it must be similarly acknowledged that those same jobs will be “lost” whenever the various projects are completed. Thus, the net job creation of the regional project lists, in and of themselves, is zero. Interestingly, the language of TIA itself contains absolutely no mention of job creation and only a single passing reference to economic development.


Revenue from the state’s gasoline tax goes to the construction and maintenance of roadways, and as such may be regarded as akin to a “user fee.” Conversely, TSPLOST levies bear no relation to user fees, as there has been no direct correlation found between consumer expenditures and transportation usage. In other words, how much money a person spends, and thus pays in sales taxes, has no proven correlation to how much transportation infrastructure that person uses.


This point is of particular note, as most motor fuels are specifically exempted from TSPLOST levies. In fact, TIA notes that the levies do not apply to “any type of fuel used for off-road heavy-duty equipment, off-road farm or agricultural equipment, or locomotives … jet fuel … fuel that is used for propulsion of motor vehicles on the public highways … [or] motor fuel for mass transit.”


On the other hand, TIA specifically provides that “the tax levied by this article shall be applicable to the sale of food and food ingredients … .” In other words, the sales tax specifically intended to fund transportation projects will not be levied on the gasoline and other fuels typically used for transportation, but will, unlike some other local option sales taxes, be levied on the food you eat.


That TSPLOST levies are applicable to food merely points up the fact that they, along with all other sales taxes, are regressive in nature. This means that it will require lower-income residents to pay a higher percentage of their incomes toward the tax than will higher income individuals. Is this really how we want to fund transportation projects?


Besides which, the revenue projections associated with TSPLOST levies may well prove to be problematic and undependable. The state’s prior experience with the collection of sales taxes, dependent as they are on fluctuating economic conditions, reveals that the revenue generated by them is more variable than that derived from other kinds of taxes and fees. Again, is this how we need to fund long-term transportation infrastructure?


There is no long-term statewide transportation plan (project lists for the various special districts are based on political considerations, not the development of a regional or statewide highway or transit network); there is no identified source of revenue for maintenance and operating expenses after the initial 10-year period; the levies will not fully fund all projects (in some cases, only studies, surveys and “initial-phase” completion are all that is funded), and some of the projects on the special district lists are already scheduled to be funded with existing state transportation funds.


Quite apart from a wide variety of taxes and fees —­ many of them directly related to transportation — that could be instituted to fund such projects, TIA provides for a revised TSPLOST special district project list to be brought before the voters in 2014 should the current ballot question be defeated. That is precisely what should happen, with the hope that a more reasonable approach may be in the offing two years hence.


• James Garland, an alumnus of the University of Georgia and longtime resident of the Athens area, blogs at The Other Athens, www.theotherathens.blogspot.com.


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