MARTA Faces More Cuts as Sales Tax Proposed for Transportation
With additional reporting by Matthew Cardinale.
(APN) ATLANTA — After three straight years of no meaningful action on transportation funding, advocates and state officials are hopeful the Georgia General Assembly and Gov. Sonny Perdue will get it right in 2010.
SALES TAX PROPOSALS
Perdue made the first move on January 14, 2010, when he announced his support for a referendum on a regional sales tax structure for transportation funding.
While Republicans in the State legislature have yet to introduce an official bill, it is expected that whatever bill is introduced will use Perdue’s proposal as a starting point, Scott Haggard, MARTA’s Director of Government Relations, told Atlanta Progressive News.
Under Perdue’s plan, the state would be divided into 12 regions with each voting in 2012 on whether to approve a one-cent sales tax to fund a list of projects determined by each region.
“The state’s director of planning will work closely with local communities to create a project list for each transportation district,” according to a description in State Rep. Pedro Marin’s e-newsletter. “The project list will knit together transportation improvements that connect our cities and regions, making the movement of people and goods faster and more cost-efficient.”
Ten counties would comprise the Atlanta region: Fulton and DeKalb, in addition to Cherokee, Clayton, Cobb, Douglas, Fayette, Gwinnett, Henry, and Rockdale. 11 other multi-county regions would be created under Perdue’s proposal.
Each region would then vote in 2012 on whether to approve a one cent sales tax increase to fund transportation projects. Each region would have discretion over whether to use the money for mass transit or other transportation costs, Haggard said.
The sales tax would not have to be approved by the entire state. For example, if the Atlanta region but no other regions approved the sales tax increment, only the Atlanta region would collect and spend the tax, Haggard said.
It should be noted that Dekalb and Fulton County residents already pay 1 penny on every dollar purchase made, that is earmarked for MARTA. If the ten county Atlanta region approved the newly proposed sales tax, Fulton and Dekalb residents would therefore be paying a new penny for a regional transportation plan on top of the penny already earmarked for MARTA in both counties.
Haggard said there has been some discussion of exempting Dekalb and Fulton for that reason, although exemptions for Fulton and Dekalb have not appeared in current legislation.
Residents living in the City of Atlanta, whether in Fulton or Dekalb, would see their sales taxes increase from the current eight cents to nine cents per dollar, if the legislature and then regional voters approve the measure [presuming Fulton and Dekalb receive no exemption]. Residents in unincorporated Fulton and Dekalb would see their sales taxes increase from seven cents to eight under the same scenario.
Currently, City of Atlanta residents pay eight cents on a dollar in sales tax: four cents for the state, three cents for Fulton or Dekalb, and one cent for the City of Atlanta’s water treatment fund. Fulton’s three cents currently go towards education, local option, and MARTA, respectively; Dekalb’s go towards education, homestead, and MARTA.
[The above-mentioned penny in Dekalb and Fulton for educational capital improvements is set to expire in 2012, although Atlanta City Councilman Michael Bond tells APN that Atlanta Public Schools is currently lobbying the State to allow Fulton and Dekalb voters to renew that penny. If that Fulton/Dekalb penny for education is not renewed–which Mr. Bond does not think is necessary because APS has completed its plan for school construction–then Mr. Bond will seek to allow City of Atlanta voters to approve a new penny for public safety; the City Council of Atlanta recently voted 12-0 to approve Bond’s proposal.]
In Perdue’s Fiscal Year 2011 budget, the Governor has asked the Georgia General Assembly to approve 300 million dollars in General Obligation Bonds to fund transportation projects across the state. While the list of projects includes numerous road projects and port improvements, rail enhancements are conspicuously absent.
House and Senate Democrats in the legislature answered on February 04, 2010, when they rolled out their Transportation Jobs Development Act. The legislation proposes a constitutional amendment levying a one-cent sales tax to fund transportation projects in special tax districts.
Under the Democrats’ plan, the Metropolitan district would include the same 10 counties under Perdue’s plan. However, unlike Perdue’s plan which would create a total of 12 regions, where each would vote in 2012 on a sales tax increment, the Democrats’ plan would only create the Metropolitan district, Haggard said.
Other counties under the legislation could approve their own transportation sales tax, or could band together with neighboring counties to create another special transportation district, Haggard said.
Another key difference between the two bills is that at least 50 percent of the sales tax under the Democrats’ plan would be used for transit within the defined region [with the exception of Fulton and DeKalb counties, which would have more discretion because they already collect a one-cent MARTA tax]. Perdue’s plan, alternatively, would not mandate that any portion go towards mass transit, Haggard said.
“A district board consisting of elected officials on the metropolitan area planning and development commission would oversee transportation activites [sic] in the district,” State Sen. Doug Stoner, a key sponsor of the bill, wrote in his e-newsletter.
Additionally, the Democrats’ bill would dedicate the fourth penny collected on motor fuel to any general transportation purpose. Currently, when an individual purchases gasoline in Georgia, they pay a motor fuel tax and a four cent state sales tax on motor fuels, Haggard said. Currently, three of those four cents go towards roads and highways, while the fourth penny goes to the State’s General Fund.
The fourth penny on the sales tax for motor fuels has generated 137 million dollars as of FY 2009; this money would be redirected under the Democrats’ plan from the General Fund to transportation.
“The most important thing is we do it right,” Lee Biola, President of Citizens for Progressive Transit, told APN in an interview. “If we rush something through that only helps roads, that doesnt really help us. That only repeats the mistakes of the past.”
GEORGIA MISSES OUT ON FEDERAL FUNDING
Perhaps now more than ever, the pressure is on for transportation success. State leaders are under fire after disappointing announcements from the federal government on transit funding.
Georgia learned on January 27, 2010, that it will receive only a 750,000 dollar slice of an 8 billion dollar federal funding package for high-speed rail. The money for Georgia will only be used for three feasibility studies.
After several years and millions of dollars in investment, North Carolina received 545 million dollars and Florida received 1.25 billion of that same money.
Then on February 01, 2010, President Obama announced his FY 2011 budget includes 1.82 billion dollars for 27 major transit construction projects in Metro areas across the US. Georgia did not make the cut.
This money will be used to construct smaller, local transit projects that have already received local and state funding.
“We have not been investing in rail the way other states have been investing over the years,” Biola told APN. “North Carolina has been doing small fixes. Over time, they have been able to modernize their passenger system and that’s why they got half a billion dollars.”
The federal government is only interested in providing matching funds to states and cities that have devised transit systems that can operate for a minimum of 20 years, Biola said.
“If nothing changes, we’re going to see the same result next time,” he said. “If the state will not get out of the way and let regions have the flexibility to have funding they need over the long term, we will not get federal funding.”
State lawmakers representing Fulton and DeKalb Counties last week listened to testimony from three key transit players: Georgia Department of Transportation Commissioner Vance Smith, DOT Planning Commissioner Todd Long, and MARTA General Manager Beverly Scott.
Smith said representatives from eight states visited with GDOT officials on January 25, 2010, and shared ideas and success stories about their high-speed rail projects.
“Were not very far along down the track but we can learn from them and they were very enthusiastic about sharing with us,” Smith said.
Long said Georgia has for too long “coasted on past successes” to the point that the state is now dead last in transportation spending per capita.
“If you look at 20 years ahead, our congestion is going to double,” Long said. “Getting companies to come here, getting companies to stay here becomes a challenge.”
Long acknowledged a growing consensus among State lawmakers that the only remedy for Georgia’s transit woes is additional revenue streams.
Scott was blunt with lawmakers, noting that without state intervention this year, MARTA faces grave consequences.
“None of this works without having overall increased investment by our state,” Scott said. “There simply is not enough money to maintain what we’ve got.”
MARTA’S FISCAL WOES
MARTA is the ninth largest public transit system in the United States yet it is the only system of its size not to receive State funding. The system relies on a one-cent sales tax from Fulton and DeKalb Counties and rider fares for most of its funds.
Up until 1998, MARTA regularly received up to 80 percent of its operational funds from the federal government. Since those funds dried up, MARTA has had to dip into its reserve almost every year to make up budget gaps.
As previously reported by APN, the authority’s FY 2010 budget had a 109 million dollar operating gap, forcing the company to make numerous changes, including service cuts and a twenty-five cent fare increase on standard rides.
The FY 2011 budget, which takes effect July 1, 2010, has a 120 million dollar projected operating gap. What compounds the problem is MARTA will not have 45 million in stimulus funds to fall back on like last year.
Also tying the authority’s hands is a state restriction that demands MARTA spend half of its funds on operations and half on capital expenses while forbidding the system from dipping into capital reserves to make up operational gaps.
As previously reported by APN, legislation to allow MARTA to dip into its capital fund for operational costs passed the State Senate but not the House last year. It is not immediately clear whether the legislation can pass this Session.
“I dont need a cheerleader, I need a partner,” Scott said Friday, February 05, 2010. “More than Fulton and DeKalb have to step up.”
Scott insisted any voter referendum on transit funding should happen in 2010, not 2012.
“Georgia cannot wait four more years to catch up with the needs of a population that has outgrown its transportation system,” State Sen. Stoner agreed.
Without spending flexibility and serious financial assistance this year, Scott said MARTA might have to cut service 25 to 30 percent at a minimum.
PUBLIC FORUM FOR MARTA RIDERS
During a forum at its Lindbergh headquarters on Saturday, February 06, 2010, officials outlined proposed service modifications, including the prospect of total service outage one day a week, either on Saturday or Sunday.
About 100 people attended the forum and several citizens made comments, arguing that MARTA should receive funding from the state or federal government or both. One group, called ACT Now, hosted an informational table.
One MARTA rider who attended the forum, Harley Stover, said he obtained a flyer announcing the forum while riding a MARTA bus. The flyer asked MARTA riders to give input on how much fares should be increased or how services should be cut.
However, MARTA did not specifically mention a fare increase Saturday nor did they direct citizens to speak to those specific issues.
MARTA spokeswoman Cara Hodgson told APN the public comments were being compiled for review as it relates to specific routes and services.
Despite troubling prospects on the horizon, Scott struck an optimistic tone.
“I feel a difference in tone at the beginning of this [legislative] session than I did last year,” she said. “There’s a lot of work to be done to get the tone to turn into something meaningful.”
MARTA will be hosting a legislative lobbying day on February 18, 2010 and is asking riders to attend a breakfast at the freight depot by the Capitol at 8:30am and/or join the lobbying day at 10am.
(END/2010)
About the author:
Jonathan Springston is a Senior Staff Writer for The Atlanta Progressive News and is reachable at jonathan@atlantaprogressivenews.com. Matthew Cardinale is the News Editor and is reachable at matthew@atlantaprogressivenews.com.
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