Georgia Transportation Bill Ignores Public Transit
This bill has come a long way from the original version, which would have sharply reduced revenues for local governments in order to boost funding for the Georgia Department of Transportation (GDOT) by one billion dollars per year.
Now lawmakers have come up with a plan to raise 900 million dollars without raiding local coffers.
But the legislation gives short shrift to public transit and eliminates incentives that helped Georgia’s electric vehicle market gain a foothold.
“Georgia is between a rock and a hard place on the transit issue,” Wesley Tharpe, a policy analyst with the Georgia Budget and Policy Institute, told Atlanta Progressive News.
“There’s bipartisan agreement that it’s important in terms of economic growth, but the Constitution [of the State of Georgia] says that gas tax revenue can only be spent on roads and bridges,” Tharpe explained.
Gas tax revenue accounts for the majority of the 900 million dollars the state will raise, meaning that the majority of the new transportation funding can only be spent on roads and bridges.
HB 170 hikes the state excise tax on gasoline from 7.5 cents per gallon to 26 cents per gallon for regular fuel and 29 cents per gallon for diesel.
With the bill’s other provisions in play, the net increase will end up around seven cents per gallon.
“One of the real positives of the bill is that [lawmakers] have indexed [the excise tax increase] to the rising fuel efficiency of cars, so that it keeps up with economic changes over time,” Tharpe said.
The excise tax is also indexed to inflation for two years.
The excise tax increase goes hand-in-hand with eliminating a four percent state sales tax on gasoline. Three quarters of that revenue has historically gone to GDOT, while the remainder went into the General Fund. The change effectively shifts 170 million dollars from the General Fund to GDOT.
The new and redirected revenue is limited to spending on bridges and roads, though some transit advocates tried to change that.
“One of our very first asks was that [lawmakers] consider a reinterpretation or constitutional amendment to expand the definitions limiting how that money is spent,” Brionte McCorkle, a spokesperson for Sierra Club Georgia, told APN.
Instead, lawmakers created additional revenue streams that are not subject to the constitutional limitations.
These include a hotel/motel tax of five dollars per night; a weight-based annual fee on trucks; and a 200 dollar annual fee for owners of private electric vehicles (EVs) and 300 dollars for commercial EVs.
Altogether they add up to 200 to 300 million dollars per year that could conceivably go toward transit. But other legal technicalities prevent the money from being tied solely to transit.
McCorkle calls the revenue raised by these fees “negligible” compared to what it would take to meet Georgia’s transit needs, even if some of that revenue is used towards transit.
She also takes issue with the fee on electric vehicles, which drew opposition from environmental groups, including the Sierra Club.
“The user fee is really arbitrary and punitive,” McCorkle said.
“When we asked Representative Jay Roberts [the author of HB 170] how he arrived at 200 dollars, he said that the average driver pays 85 dollars per year in gas taxes. He said he took that, doubled it, and rounded up.”
“We weren’t against the fee, we just wanted it brought down to a comparable level. Now [electric vehicle owners] are being forced to pay more than someone who is burning gasoline and polluting the air,” McCorkle said.
HB 170 also eliminates a five thousand dollar income tax credit for electric car buyers, along with a tax break on jet fuel worth about 23 million dollars per year.
Adding to the session’s transit woes, the Metropolitan Atlanta Regional Transit Authority (MARTA) lost out when State House leaders reversed on an agreement to support a provision in another bill, in exchange for Democrats’ votes on HB 170.
The provision, part of HB 213, would have allowed MARTA to add an additional one-half percent to its one percent sales tax collections in Fulton, DeKalb and Clayton Counties, if approved by voters.
If House leaders had not tossed it out at the last minute, MARTA would have the potential to collect an additional 200 million dollars per year.
HB 213 passed without the provision.
As previously reported by APN, it removes a legal requirement that for years has forced the transit authority spend half of its sales tax income on capital costs, leaving only fifty percent for its operational budget.
McCorkle says that, unfortunately, the measure is more symbolic than effective because MARTA has had to borrow so much to keep up with operational costs that it is now crippled by debt.
The silver lining for transit is a provision in HB 170 allowing counties and regions to hold penny sales tax referendums to fund local transit projects, a process known as T-SPLOST.
While HB 170 is largely a missed opportunity for transit, Tharpe stresses that the bill is an important first step.
“Now that the groundwork is there, the key challenge will be coming back in the next year and fixing it,” he said.