Transportation Funding Act Changes Unveiled

At a Wednesday afternoon meeting of the House Transportation Committee, Chairman Jay Roberts revealed additional changes made to House Bill 170, the Transportation Funding Act. There are three significant changes from the previous version:

  • The sales tax rate for LOST, ELOST, HOST, and MOST taxes will be changed to 1.25% from its current 1% to account for the loss of revenue by not charging these taxes on motor fuel.  Once the transportation funding bill goes into effect, these taxes will not be charged on motor fuel.
  • SPLOST and ESPLOST taxes will continue as they are until they expire.  If these taxes are renewed by voters, then at that point, sales taxes collected on motor fuel must be spent on transportation purposes.  The definition of ‘transportation purposes’ as it applies to the use of these taxes is being broadened to account for school system use.   It now covers school buses and  other items necessary to move students to and from school, plus infrastructure and services needed to provide that transportation.
  • The previously proposed six cent excise tax that could be charged by cities and counties after Board of Commissioners approval is no longer in the bill.

Other changes include removing the  language specifying that the $200 or $300 annual tax on electric vehicles is dedicated to transit.  Chairman Roberts pointed out that Sierra Club lobbyist Neill Herring thought that language might be unconstitutional.  As a a result, this appropriation for transit will need to be made in the budget each year.

In the section dealing with the transportation infrastructure bank, the definition of preferred projects has been expended from level 1 and 2 projects to include projects in which local  communities have made an investment.

Commenting on the work done on the bill, Roberts said it had always been an ongoing process. He is sure other changes will be made along the way, and in the end, hopefully the House and Senate can come together to  pass a bill that will work for Georgia’s future.

After considering several amendments (and rejecting all but one technical amendment to the bill,) it received a “Do Pass” recommendation, and will be sent to the full house for a vote, possibly on Friday.

13 comments

  1. gt7348b says:

    So I watched the streaming feed and wondered two things as I watched:
    1) How long before someone calls the increase from 1% to 1.25% for HOST, LOST, and
    MOST a tax increase (and do they care since those who are likely to call it a tax increase wouldve called anything a tax increase)?

    2) Was Rep Setzler’s amendment anything other than a shot a the Cobb county commission and the continued studying of a BRT system on 41?

    Just curious what the illustrious commentators on this site would think.

    • Will Durant says:

      1) As to the ¼¢ thing, cue up the hissy fit from you know who is 5-4-3…
      2) If we are already paying nearly a billion for glorified bus lanes down I-75 the BRT on 41 would be redundant.

      My own 3) is the squish left in future SPLOSTS. I was hoping to eliminate all sales taxes from motor fuel eventually. Unlike some other people who post here though I understand when compromise is necessary.

      • Charlie says:

        The original bill had 3 cents fixed for local governments that had to be used for transportation.

        The current version has 1% (3 cents on gas priced at $3) that has to be used for transportation. Thus, the dollar amount involved is about the same. The compromise here (which Chairman Roberts said in at least one of the subcommittees he was open to) was that “transportation purposes” for ESPLOSTS now includes, buses, fuel, maintenance, etc.

      • gt7348b says:

        Thanks for the clarification. In transit circles, fixed guideways do include bus only lanes, aerial tramways and monorails, not just steel wheel on rail technologies. The Federal Transit Administration has defined fixed guideways for the purpose of allocating what is classified as 5309 funds for a region. The additional clarification of what consitituted a fixed gyudeway bus system was actively discussed during the rule making after MAP-21 passed.

  2. polpol says:

    But it would have required a second vote if Cobb ever approved bring MARTA to the County, as the first vote would not necessarily involve extension of rail, just bus services, ala Clayton, but when MARTA eventually determined to extend rail into Cobb, the the second vote would trigger.

    • gt7348b says:

      Actually, MARTA votes are for a contract for services and I believe the MARTA and Clayton contract specified some sort of fixed guideway to Clayton but by calling it fixed guideway avoided the question of what technology. Therefore, no further vote would be necessary.

  3. George Chidi says:

    I’m satisfied … which is to say that I’m displeased, but not enough to scream. I’m curious if GMA will feel the same.

    Six cents on gas per gallon — call that a 2.5 percent tax. If raising sales taxes by a quarter point is worth replacing the proposed city/county tax, that implies that gas spending is a tenth of what we (taxably) spend on everything else we buy. A quarter point looks about right. I figure about 33 percent of all consumer household spending is taxable. That’s the right amount of offset if three percent of consumer spending is on gas.

    That said … all sales taxes are regressive, and therefore suck. Poor people pay more than rich people as a percentage of their income this way. But I’m a realist. This may be the only way this goes forward, and this is about 75 percent of the way to a solution.

  4. Teri says:

    I kind of feel like George. I haven’t said much about the proposed bill for a couple of reasons: I wanted to see what the process resulted in, and as the process was a result of a lot of smart and informed (as several not-so-smart and wholly uninformed) people adding their voices to the cacophony, I have learned that whether it’s the PTA, the HOA, or the GMA, let the loud people get their shouting done, see what you’re left with when the dust settles, and then go from there.

    Anyway.

    My primary area of interest is the SPLOST. It was clear from day 1 that any current SPLOSTs (and FTLOG, please don’t pronounce it “splosh”) were not going to be impacted in any way. So, for example, the Cobb SPLOST that passed this past November and will be in effect from 1/1/2016 until 12/31/2021 will proceed as planned. Hooray and awesome, because that money is slated to make massive transportation infrastructure improvements in my city.

    The 2016 SPLOST is projected to provide around $287M for transportation and transportation infrastructure projects (here’s a handy breakdown: http://www.cobbcounty.org/images/documents/SPLOST2016/SPLOST_2016.pdf). But I have no idea how much of that $287M comes from sales tax on gas, so my question is, has anyone done a side-by-side of the amount that municipalities are currently getting from current SPLOSTs, compared to what they would be projected to collect if the proposed formula were implemented? That bit of information might go a long way in explaining to local electeds why they should – or should not – support the SPLOST aspect of the legislation.

    • Jon Richards says:

      Well, the easy answer is that under the latest version of the bill, any future SPLOSTs implemented after the TFA goes into effect will get the same amount of money as they would have had the bill not passed. The difference is that the portion of that tax collected on motor fuel would need to be spent for transportation purposes.

      For some counties, like Gwinnett and I’m pretty sure Cobb, that won’t be a problem, as current SPLOSTs dedicate a larger percentage of their revenue to transportation than they get from the motor fuel portion. for other counties, like Butts, not so much, as something like 40-50% of their sales tax revenue comes from motor fuel taxes.

      • Kyle Hayes says:

        How does that provision on SPLOST (and ESPLOST?) affect the revenue estimate? Or did the fiscal note released earlier have these changes included? My impression was that most of the money the state was raising came from that SPLOST/ESPLOST transition (plus changes to LOST, ELOST, HOST and MOST)

        • Jon Richards says:

          Because in the end, the state is still going to get its 29.2 cents per gallon excise tax, which is what the fiscal note was based on. The change to the LOST/HOST rate affects local funds, not DOT revenue. Same thing with allowing SPLOSTS and ESPLOSTS to continue. Sure a portion of that revenue must now be spent on transportation, but that’s local funding, not state.

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