Thursday, February 21, 2008
News House's transportation committee OKs statewide tax increase
Posted by Thomas Wheatley @thomaswheatley on Thu, Feb 21, 2008 at 3:25 PM
The state House Transportation Committee today approved a resolution 20-5 that would raise sales taxes by a penny statewide for transportation projects -- and would amount to what legislators say is the largest tax increase in Georgia history. Legislators are now expected to negotiate with the Senate -- whose local-option sales tax strategy passed earlier today -- and hash up a resolution both chambers find suitable. If it makes it out of the Gold Dome, voters will have the final say in November.
But if last night's committee was any indication, lawmakers will most likely chisel away at the plan before a full vote in the House.
The meeting -- which ran three hours past schedule -- was filled with questions and concerns from legislators, many who were nervous in an election year to tag a tax increase on to the same ballot where their own name would appear.
Perhaps most vocal of the resolution's critics was Rep. Steve Davis, R-McDonough, who said he was hesitant to vote for the tax increase. Davis, a fervent metro-Atlanta critic who is almost cartoonishly opposed to transit projects, insisted that all other options -- such as the reforms currently underway at the state Department of Transportation -- be explored before a tax increase is levied statewide.
Terry Chastain of the Metro Atlanta Chamber of Commerce, speaking before the committee, responded that reforms could only do so much -- the harsh reality, he said, is that the motor fuel tax, which funds the bulk of transportation costs, is predicted to cash out in the next several years. Rep. Smith voiced such a statement earlier in the meeting, saying that Commissioner Gena Abraham's initial reforms may loosen up cash, but that would most likely be a one-time event. Sooner or later, Smith said, something would have to be done to address the lack of transportation funding in the state. The DOT recently admitted it faces a $7.7 billion funding shortfall.
Smith said the tax increase is estimated to generate $1.3 billion dollars. (Keep in mind, if the economy falters that figure could be less.) Money would be divvied up among the state's regional business districts. The bulk of money generated in each district -- 90 percent -- would go toward projects in that district, the chairman said. The rest would go to the state's transportation fund to be used on larger projects. Only items that are currently taxed would be subject to the increase.
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