Transportation funding: Should Georgia follow another GOP governor’s lead?
After last year’s resounding T-SPLOST flop, Georgia legislators are not expected to make any big moves regarding new transportation funding. But forget new transportation funding: Given the long-term decline in the purchasing power of the motor fuel tax, which will only accelerate as vehicles become more fuel-efficient, Georgia will have to consider alternate means of funding for building and maintaining roads and bridges. Increasing the motor fuel tax rate even just to maintain parity might work in the short term, but it’s probably not a solution in the long run.
Few of the most-discussed alternatives have obvious appeal. Tolls almost certainly will become a more important source of revenue, particularly on the interstates, but that’s a limited option. You’re extremely unlikely to face a toll booth between your house and the grocery store, and there are vast swaths of the state where tolls probably aren’t viable. Another option, tracking the number of miles traveled by a particular vehicle and levying a fee on its owner accordingly, is bound to raise Georgians’ libertarian hackles as a Big Brother-ish intrusion on their privacy.
So it sparked my interest that Virginia Gov. Bob McDonnell — whose conservative bona fides are strong enough that he was considered a leading contender to join the GOP’s 2012 ticket to make it more favorable to conservative activists — yesterday announced his proposal to address the gas-tax problem in his state. McDonnell proposed eliminating Virginia’s gas tax completely for most motorists, and replacing it with a 0.8-cent increase in the state’s sales tax:
While the gas tax has been stagnant, sales tax revenues have continued to grow with the economy, McDonnell said. His plan to increase the state’s 5 percent sales tax to 5.8 percent and dedicate all of the additional revenue to transportation would raise an additional $607 million over five years, he said. Eighty-five percent of the additional revenue would be spent on maintenance, the rest on construction.
The 17.5 percent tax on diesel fuel would remain unchanged because heavy trucks cause about 80 percent of the damage to Virginia’s highways, the governor said, and most of those vehicles come from out of state.
The plan also includes McDonnell’s previously announced proposal to increase the portion of the existing sales tax already earmarked for transportation. A half-cent already goes into the state’s highway fund. The governor’s proposal would increase that commitment to three-quarters of a cent over five years, generating an additional $811.5 million over that period.
When combined, the two sales tax changes would give transportation about one-quarter of sales tax proceeds.
There are some other elements to the plan, including a $100 annual fee for hybrid and alternative-fuel vehicles and a $15 increase in the state’s vehicle registration fee. Maybe most notably, the plan depends on Congress to pass a law allowing states to levy a sales tax on purchases from “out-of-state online and catalog sales.”
Any change as large as this one is bound to have problems. For one, it’s a shift away from a user fee (gasoline) toward a general consumption tax. That was one argument here against the T-SPLOST. And, in Georgia at least, the motor fuel tax was a more stable source of revenue than the sales tax during the recent recession: The motor fuel tax didn’t fall quite as sharply and has come much closer to recapturing its pre-recession peak.
But I’m curious what y’all think of the elements of McDonnell’s plan and whether Georgia should implement all, some or none of them. The gradual dedication of part of the existing sales tax to transportation, for instance, is a plan that was discussed before the T-SPLOST law was passed in 2010. Which elements of the McDonnell plan might make sense for Georgia?
– By Kyle Wingfield
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102 comments Add your comment
Dusty
January 9th, 2013
2:18 pm
Well, I see Kyle is really getting serious here. Look at this one: (Which is to say there’d be a difference beweeen $1 toll and a $100 toll.) Wow! You betcha!
For whom the bell tolls. It tolls for you and me…For whom the tolls toll? For the GDOT and a pox on them!!
Road Scholar
January 9th, 2013
2:21 pm
Kyle: Yes there is more money…but it does not cover the estimated yearly shortfall required to keep the existing facilities maintained! It will also add $150 M for new roads/interchanges. A 4 mile widening in an urban area costs about $10 M a mile including right of way. An interchange costs about $25 M. Not much new construction huh?
After the I 85 debacle, the GDOT Board changed there policy that tolls can only be used on new lanes…thus part of the funding for the I 75/I 575 project which proposes two reversible lanes along I 75 from I 285 to I 575 and a single reversible lane on I 75 and I575 for a few miles north of the split.
Dusty
January 9th, 2013
2:36 pm
Road Scholar
You have crossed the yellow line on this roadway. . “Yes,” you said ” there is more money”. Oh true true, indeed. But… and there’s always one……
It resides in the pockets of our poor citizens who are trying to save their pocket change before some ’statesman” figures out a way to prize it from their cold, calloused hands.
The magic word is still CUT. Thift! Economize! Budget! Steal!. OOOps. Skip “steal”.. Politicians have already thought of that one. . .
Dekalb comments
January 9th, 2013
2:39 pm
I would not want to give the General Assembly and the Governor the ability to take any increase in the state sales tax and divert it to pet projects if the reason for the increase is to address a shortfall in funding badly needed transportation projects and maintenance.
One proposal that appears on the surface to be interesting would be to go from a per-gallon tax to a per-mile tax on vehicles licensed in the state. Annually at registration the number of miles is recorded and a value calculated based on axles, weight, etc. of the vehicle. That ties directly to use of the transportation infrastructure that avoids the pitfall of the gasoline tax which drops as efficiency increases.
The problem with that is we lose revenue for those vehicles using our roads, bridges, etc. that are not licensed here. Given we are a major crossroads both for north-south and east-west travel, this would be significant.
Hillbilly D
January 9th, 2013
2:39 pm
Road Scholar @ 2:13
That’s pretty much what I thought. So a person like me who drives a vehicle until it won’t go anymore, will still be paying ad valorum taxes for quite a while.
JDW
January 9th, 2013
2:42 pm
Interesting topic, but with our current crop of Legislators pretty much a mute point. I really don’ t see them taking time off from junkets, fund raising and other more “pressing” legislation such as carry laws, tax break gravy for businesses and maybe the odd microchip implant initiative.
However, 10 years from now when the demographics have shifted a bit and we have a Governor/Legislature that is ready to actually do some work, it would seem that the logical place to raise revenue would be with fees tied more closely to use rather than broad sales taxes. Things like increasing the per gallon tax, increased taxes on diesel and other fees to recoup costs from commercial trucking firms, maybe an add on to the hotel motel tax to get at the visitor population and of course drivers license and tags fees make sense as well.
Hillbilly D
January 9th, 2013
2:46 pm
One proposal that appears on the surface to be interesting would be to go from a per-gallon tax to a per-mile tax on vehicles licensed in the state.
I see two problems with that. One, all the people passing through the state (to and from Florida, for instance) will contribute nothing for using Georgia roads, whereas with the gas tax, they most likely will have to buy gas somewhere in Georgia. Two, up here in the Hills and we have people who actually live here but they have vacation homes in other states (usually Florida). They register their vehicles in Florida and drive around on Florida tags all year because it’s cheaper, so they’d pay nothing. Yes, it’s illegal for them to do that but it’s done all the time and has been for years and nothing is ever done about it.
The law requires if you reside in Georgia for 30 days, for you to register your vehicle, by the way.
Jm
January 9th, 2013
3:05 pm
I think it’s a bad solution, for some of the exact reasons you cite Kyle
Tolls + fuel tax + local property taxes pay for roads
BW
January 9th, 2013
3:13 pm
Kyle
These guys in the Gold Dome can’t even take up comprehensive tax reform with a Republican supermajority and you want them actually raise gas or sales tax? I actually concur with eliminating the gas tax over time and increasing the sales tax to fund the needed infrastructure repair and maintenance to say nothing of new projects and potentially transit. Obviously there must be a funding goal and distinct lines how the money gets devoted to transportation and is not siphoned off. Two big issues: One the trust of Georgians and their government and two will it devolve into a battle about funding transit at any level. This can’t be a small bore thing in the name of conserving the staus quo or slow-walking needed change for funding transportation. How about some of those committees at the Gold Dome put some ideas into a bill so it can be debated at least? This will all begin and end with the legislature and right now they are still shellshocked over T-Splost.
Dusty
January 9th, 2013
3:15 pm
Hillbilly,
I am going to make you honorary deputy up in your part of the country. Nab those long staying sunburned Florida floozies with their Hawaian shirts, cut off pants and dark glasses. . Make ‘em ;pay. Have “honorary” gas pumps with “guest” tax rates just for cars with Florida licenses. I say TAX ‘EM.
Just trying to be helpful here. ’cause I went out to lunch and feel good.. The camaradarie was great, not to mention the fried chicken. Now cheer up.. You are my favorite hillbilly deputy..
Hillbilly D
January 9th, 2013
3:21 pm
Dusty @ 3:15
A goodly percentage of those folks were born and bred here. It’s all about who you know, like a lot of things. I know one guy, been here 30 years or more, still buys his tag in south Georgia. He’s an upstanding member of the Chamber crowd, too.
I’ll pass on the deputy thing. The law has never been applied equally, at least not in my neck of the woods. Maybe I should email Kyle some more stories that can’t be printed.
Jefferson
January 9th, 2013
3:24 pm
A sales tax, a gas tax, an income tax… anyway you lood at it the road are not free, but the paving companies are making off like bandits.
Sales taxes are regressive. Progressive income taxes have been deemed more fair, I agree — you don’t have to.
MANGLER
January 9th, 2013
3:28 pm
The whole gas tax concept is derivative of a time when vehicles were not as fuel efficient as they are today, when trucks didn’t weigh as much as they do today, and when pretty much the only option to drive was to pump fuel into the vehicle, hence it was relatively fair across the board to all drivers. Not to mention the concept of wireless transmission of data didn’t exist. None of those factors are the same today.
Anyone who wants a tax system to be more fair should be able to give credence to the concept of pay what for you use. Is it fair for a hybrid or totally electric car owner to pay close to $0 annually towards road maintenance and construction when they clearly are using that infrastructure? Is it fair to the taxing authority that people may be driving further yet getting better mileage and thus paying less for their use of the infrastructure? Trucks would pay based on their gross weights. Heck, every vehicle could be taxed based on it’s weight vs. miles driven. An Accord does less damage than an Escalade over the same stretch of road.
How can anyone be upset with filling out an extra line on the renewal form which asks you how many miles you drove that year? You drove it, you pay for it. Some people would be better off that way. Some would be worse off. But the system would me more fair than it currently is.
And as far as worrying about big brother? Do any of you have a cell phone or GPS in your car, lojack or Onstar? What do you think that is? You car is already tracked every single moment it moves.
Dusty
January 9th, 2013
3:32 pm
Owwww Hillbilly,
Do pass on those stories to Kyle. You know. The ones that can’t be printed. A little risque’ is OK and Kyle can disguise them but WE will know the nitty gritty of graft & goodies of naughty North Georgia!! .
But you better hurry. Kyle goes to bed at 5:30 and doesn’t give a snap after that. But he’s not from Florida. A good Georgia boy is always acceptable.
Hillbilly D
January 9th, 2013
3:35 pm
Dusty
Well, I don’t personally know Kyle, or his background, but there are Wingfields all over North Georgia and have been for a very long time. As for going to bed at 5:30, I’d imagine with those boys, Kyle needs all the shut eye he can get.
SWGAConservative
January 9th, 2013
3:37 pm
I saw something about 92% comes back. I think that number is actually around 87%. Georgia is a donor state and always contributes much more than it receives.
Dekalb comments
January 9th, 2013
3:38 pm
@ Hillbilly 2:46
I concluded my comment on the idea of a “per-mile” tax by observing this excludes vehicles that are registered out-of-state. For that reason this isn’t viable. About the only state in the country where that might be viable is Hawaii where few, very few vehicles driven on roads in Hawaii are licensed outside of Hawaii except for military personnel.
I just don’t trust the legislature to make sure the additional sales tax is actually allocated to transportation projects.
Hillbilly D
January 9th, 2013
3:38 pm
How can anyone be upset with filling out an extra line on the renewal form which asks you how many miles you drove that year?
What’s to keep people from being less than truthful, when they fill it out?
Do any of you have a cell phone or GPS in your car, lojack or Onstar?
I don’t. Admittedly I’m a tad on the quare side, though.
Hillbilly D
January 9th, 2013
3:41 pm
DeKalb,
Well, I’m with you on the sales tax. There’s no perfect solution but my solution would be, if you need to raise the gas tax, then raise the gas tax. I don’t think most in the Legislature want to man up and do that, if they can figure a less obvious way (i.e. one that protects their electorial hide) to do it.
Will the last Democrat in Georgia please turn off the lights?.....
January 9th, 2013
3:50 pm
{{”Which elements of the McDonnell plan might make sense for Georgia?”}}
The element of the McDonnell plan that makes the absolute most sense is to ELIMINATE the state’s gas tax.
But instead of replacing the state gas tax with a 0.8-cent increase in the state sales tax, the better course of action would be to replace the gas tax with a distance-based user fee on each major road so that each major road is capable of financing its own logistical needs according to the number of vehicles that use the road on an annual basis.
For example, there are significant stretches of the Interstate system throughout Metro Atlanta and North Georgia that are in severe need of truck-only lanes as a way of separating ever-increasing heavy freight truck traffic from other vehicular traffic on the busiest stretches of Interstate highway.
In particular, roughly 300,000 vehicles per day each use stretches of I-75 North in Cobb County, the I-285 Top End between I-75 NW and I-85 NE and the I-75/I-85 Downtown Connector.
In a scenario in which the state’s gas tax is eliminated and replaced with a distance-based user fee on each major road, if all 300,000 of those vehicles paid $1.00 per-day to use the busiest stretch of I-75 in Cobb County, just I-75 alone will gross roughly $110 million per year.
Under the distance-based use fee funding system in which every vehicle which uses the busiest stretches of road pays $1.00, the roughly $110 million per-year that an Interstate 75 (or an I-85, or an I-285, etc) will gross will be applied towards routine maintenance (resurfacing) of the very major road (resurfacing, expansion, etc) and expansion (primarily in the form of elevated truck/bus-only lanes added vertically over the existing built-out right-of-way), as needed.
Eliminating the increasingly ineffective state gas tax and replacing it with a distance-based per-use fee on each major road is not only the best way to fund critically-needed improvements to our road network, it’s the ONLY way.
Funding the road (and transit network) by completely eliminating the diminishing state gas tax and replacing it with distance-based user fees is also the fairest way to fund the roads as payment would be tied directly to how much one uses the road network.
That means that the more of the road network one uses, the more one pays in distance-based user fees on major roads. Likewise, if one rarely uses the road network they would pay less (the less one uses the roads, the less they would pay in distance-based user fees on each major road).
Politico
January 9th, 2013
3:51 pm
Hillbilly D @ 3:41
As you well know the “newest” thing is to raise the amount of “fees” so the Legislature doesn’t have to say they raised taxes. Works real well with the majority of the constituency when they claim their “guy” didn’t raise taxes. Technically he didn’t, but he was sure in favor of increased revenues via increased “fees”.
All a semantics game, but provides the same end result
Dusty
January 9th, 2013
3:53 pm
Hillbilly,
So there are Wingfields all over north Georgia. Hmmmmm…. Maybe you better report on the McCoys & the Hatfields.so you won’t get “moderated” or supplicated or whatever.
As to boys, tell me about ‘em. I have a “passel” of them. Mine are a bit beyond the “wet & wahh” stage but still the most fun ever. Of course, I have one daughter to set them all straight. We get along fine. Most of the time. Sometimes. Christmas time. Awww love them all. Kyle has only just started with all the duties and the delight, the age old story.
Politico
January 9th, 2013
3:57 pm
*on fees not “of fees”
Will the last Democrat in Georgia please turn off the lights?.....
January 9th, 2013
4:02 pm
I can’t emphasize enough of how much of a pressing need it is to eliminate the state gas tax as a means of inadequately funding our state’s increasingly-inadequate (neglected) road network.
Using the state gas tax to fund the road network is a dead-end as vehicles become increasingly more fuel-efficient and the amount of revenue taken in from the gas tax increasingly falls further behind inflation, meaning that gas tax revenues increasingly cover less and less of the cost of maintaining the road network.
@@
January 9th, 2013
4:24 pm
I’d rather raise the gas tax. Being the consciencious environmentalist that I am, I limit my driving to a minimum.
I live close to work and conveniences.
Errands are scheduled around necessary travel most of the time.
I’d be happy to let everyone else pay MY share for a change.
schnirt
Aesop's Fables and other Lib Economic Theories
January 9th, 2013
4:33 pm
When obozo sends his manhood bin biden out to proclaim the executive branch can just wish away the God given rights under the 2nd Amendment, you know that the liberals have lost.
Big time.
Jerry Eads
January 9th, 2013
4:34 pm
Interesting idea. On the plus side, everybody chips in for transportation, which might make it more likely to fund transportation options in addition to yet more roads and lanes. It might reduce the burden on those who drive more or drive guzzlers.
Politico
January 9th, 2013
4:44 pm
“you know that the liberals have lost.
Big time.”
Yep
After you claimed Obama wouldn’t win in November as well as winning more seats in the Senate and House…………. yeah they have lost “BIG TIME”
Aesop's Fables and other Lib Economic Theories
January 9th, 2013
5:01 pm
Stephanopoulos even gave the edge in 2004 to John Kerry, who went on to lose the election to George Bush. A Kerry campaign worker later told me that he and his fellow campaign workers went to bed Election Night certain that Kerry had won. MSNBC Projects Kerry As The Winner. On the evening of the vote, reporters at each of the major networks were briefed by pollsters at 7:54 p.m. Kerry, they were informed, had an insurmountable lead and would win by a rout:
JohnnyReb
January 9th, 2013
5:05 pm
Government sucks. That’s what I think of McDonnell’s plan. It smacks of the property tax fiasco.
Local governments see a reduction in property taxes due to home value decline, so they up the millage rate.
Manufacturers produce more fuel efficient cars, which BTW cost consumers more, and governments must find a way to offset the lower fuel tax income.
How about reducing the size of government? That’s right. Put some of those freeloaders on the road. Instead of three supervisors standing around with their hands in their pockets, let’s try only one.
Politico
January 9th, 2013
5:30 pm
Aesop is still in shock from the Dick Morris incorrect prediction of a “land slide” and Rove’ meltdown that he forgot his own predictions and proclamations and had to harken back to 2004.
Thanks for the laugh.
Politico
January 9th, 2013
5:31 pm
Aesop
You will be ok…………….. As Jamvet tells you in 2024 or so
@@
January 9th, 2013
5:41 pm
Politico:
You and AmVet need to give up the ghost.
I came in yesterday evening to find Kyle had put the blog to bed early. It appeared as though yours and AmVet’s stalking had brought it about. If the object of your obsession won’t engage you, the two of you talk to each other about him.
Childish.
“At length it gave up the ghost, and, like an over-cultivated intellect, became incurably barren.”–Westward Ho
Aesop's Fables and other Lib Economic Theories
January 9th, 2013
5:45 pm
@@ – They know they can get away with it while everyone else pays the consequences of their actions.
Politico
January 9th, 2013
5:51 pm
@@
What the F are you talking about? Take your childish unsubstantiated allegations up with Kyle.
Your consistent crying and whining are not admirable characteristics, yet come through each time you are on.
Politico
January 9th, 2013
5:53 pm
Aesop and @@
You two have been banned or suspended for your inability to act like adults. So let today be the day you start at least “acting” like you know how to be one.
And have a great evening
Lil' Barry Bailout - OBAMAPHONE!!!
January 9th, 2013
5:53 pm
I prefer tying the tax revenue to road usage, and that is accomplished via the gasoline tax. The surcharge on hybrids and electrics makes sense because it captures some revenue from the freeloaders who aren’t paying their way via the gasoline tax.
SB Atl
January 9th, 2013
6:04 pm
Can you please tell me WHY you would put a large tax on hybrids and electric cars? Those help our problems. Do you want somebody to pay for your bis SUV?
I don’t trust any of this greedy power mongers in the state now to do the right thing.
JamVet
January 9th, 2013
6:07 pm
AmVet’s stalking had brought it about…
And those who know her know that if this permanently banned, roundly derided miscreant says that is so, by god it is so!
You cons are such a bad joke that even Kyle is growing sick of baby sitting you!
Lil' Barry Bailout - OBAMAPHONE!!!
January 9th, 2013
6:07 pm
If you’re using the roads and not paying for them, because you aren’t buying gasoline, then you’re not paying your fair share.
JamVet
January 9th, 2013
6:13 pm
SB, I asked that same question earlier. All I got was crickets.
How many cons has Kyle banned from this joint?
Maybe he is just another closet lib who has it out for the godly conservatives here and lets stalker like myself (HUGE LOL!) remain.
You crybabies are sure hard to figure out…
Aesop's Fables and other Lib Economic Theories
January 9th, 2013
6:21 pm
Taunting is now acceptable?
@@
January 9th, 2013
6:58 pm
Our Cars’ Weight Problem
How government is making our cars lighter, and more dangerous
http://www.nationalreview.com/articles/337110/our-cars-weight-problem-robert-e-norton
There are approximately 42,000 motoring fatalities each year in the United States. That is a large number, and it has remained stubbornly at that level. Why, with all the technological innovations that have occurred in so many key areas, such as electronic stability control, anti-lock brakes, and air bags, have we not reduced those numbers significantly? The major reason, I believe, is the smaller vehicles our government has been pushing in order to support the environmental agenda.
Where are Nader’s Raiders when you need ‘em?
The Prius needs to shed 500 lbs.???????
@@
January 9th, 2013
7:02 pm
JamVet @ 6:13
All I got was crickets.
Not a bad idea….
Dixie
January 9th, 2013
7:18 pm
“Taunting is now acceptable?”
Sure!
Kyle Wingfield
January 9th, 2013
7:57 pm
That’s all for tonight, folks. Immediate commenting will resume in the morning.
Oh, and those who come on here and heckle others about being the reason for the heavier comment moderation should take a long look in the mirror…
ld
January 9th, 2013
9:15 pm
Nope. Tax automobiles by value more and dedicate that tax to transportation needs.
Also, it is far better to target any sales taxes where they will serve multiple purposes. Increase the tax on alcohol, tobacco, soda pop, fast food restaurant sales and in store “junk” food sales — all of which can make people less healthy and eventually costs taxpayers more in medical bills.
There is also a very real need — both health and economic need — for taxpayers to stop subsidizing sales of junk food products. When a person goes through the grocery line and buys all their food w/EBT (food stamp) card and then buys alcohol and/or tobacco w/cash, understand that the taxpayers ARE still actually subsidizing those purchases of alcohol and tobacco since w/o the food aid, the money those individual spend on the alcohol and tobacco would be more likely needed to be spent for food.
Logical Dude
January 10th, 2013
11:30 am
Kyle: Which elements of the McDonnell plan might make sense for Georgia?
Oh Gee: VA governor adds .8 cents sales tax. T-Splost would add 1 cent sales tax.
DUH. It’s the same freakin’ solution.
Other than the stupid $100 yearly fee on hybrids (don’t we want to ENCOURAGE better fuel economy and breath better air??), I don’t see how adding sales tax is that much different than, you know, adding sales tax.
Kyle Wingfield
January 10th, 2013
11:36 am
Logical @ 11:30: No, it’s not “the same freakin’ solution.” The T-SPLOST would have left the gas tax intact; McDonnell’s plan does not. Big, big difference.
Roadking
January 11th, 2013
12:33 pm
Why would anyone be in favor of a toll road and against a fuel tax? Appears to me, they are one and the same. If you use the infrastructure system, you should pay for it, including bicycles.
“Share the road” “Share the taxes”!