The bad news: you’re still going to be stuck in traffic.
The good news: at least you’ll be on nicely paved roads.
The Legislature passed a $1 billion transportation funding plan last week, but don’t go looking for new rail lines or some towering new interchange that will solve all the problems on I-75 and I-285. What you’ll see instead is work on a mountainous backlog of maintenance: some resurfaced roads, filled-in potholes and bridges that can support the weight they were designed to carry.
“We may be able to do other projects outside of maintenance,” said state Department of Transportation Commissioner Russell McMurry in an exclusive interview with The Atlanta Journal-Constitution. “But not like rebuilding 285 or something huge like that.”
Sorry, folks. A billion bucks just isn’t what it used to be.
Transportation consultants and state officials made it clear from the start of the debate over transportation funding last year that a billion dollars per year was the bare minimum needed just to bring the transportation system Georgia already has up to snuff.
Gas tax to rise 6 cents on average
To really get people moving — expanding transit, widening interstates, building new interchanges — would cost a little less than $3 billion a year, according to an HNTB study. And to pay for “the full universe of transportation needs in the state, including establishment of passenger rail systems,” would cost $4 to $5 billion per year, the study said.
Despite all that, Gov. Nathan Deal last week praised lawmakers for stomaching tax increases in the face of critics who cast the plan as a massive tax increase.
“It would be a great tragedy if we had an accident with a school bus on a deteriorating bridge. There would be no logical explanation as to why that happened,” he said. “This would allow us to fix those bridges and make those repairs. And it simply says Georgia is a state that’s growing.”
HB 170 lifts the gas tax for the average driver by about 6 cents a gallon starting July 1, 2016. It also imposes a new $5-per-night fee on hotel stays, a $200 annual fee on noncommercial electric vehicles ($300 for commercial) and $50-$100 fee on heavy trucks. And it would eliminate tax breaks for Delta Air Lines and electric vehicle owners.
The bill is expected to raise about $945 million a year for transportation. Technically, the income from the hotel/motel tax or electric vehicle fee could be used to fund transit. There’s little likelihood that will be the case, however, with the huge road and bridge maintenance backlog the state is facing.
The bill also allows counties — either alone or in groups — to ask voters to approve up to a 1 percent sales tax to fund transportation projects close to home. Project lists for those local taxes could include transit, which may be a ray of light for public transportation advocates. However, in a state where a regional transportation sales tax failed miserably in 9 of 12 regions in 2012, the prospects for passage of a similar measure remain unclear.
‘An appeal to the graveyard-bound’
Estimates on how much revenue the new taxes and fees will bring in over the long haul were not available as of Friday.
But some groups are optimistic about that. The new motor fuel excise tax rate of 26 cents per gallon (29 cents for diesel) is tied both to inflation and increased fuel efficiency. It could grow at a rate of 6 percent for the first two years, assuming a 3.5 percent rate of inflation and a 2.5 percent increase in fuel efficiency standards, said Baruch Feigenbaum, a policy analyst for the Libertarian Reason Foundation. After that, it is likely to continue increasing at a slower rate, 2.5 percent, because the new law will no longer tie the motor fuel excise tax to inflation after 2018.
Those upward adjustments to the gas tax could mean tens, or perhaps even hundreds of millions of dollars more flowing into state coffers, according to Feigenbaum.
“I think they are going to have some significant funds for new construction,” said Feigenbaum.
The bill was a bitter disappointment to some groups, like the Sierra Club, that had hoped to see funding for transit included. They see the legislation, which is exclusively for roads and bridges, as an old-fashioned solution ill-suited to modern realities.
It “appeals to a demographic of drivers who are in their last, or next to last new cars,” Sierra Club lobbyist Neill Herring said. “This is an appeal to the graveyard-bound.”
State losing ground on maintenance
At the very least, the new funding means GDOT can start whittling down a $500 million backlog in deferred maintenance projects — doing things like fixing potholes, filling cracks in asphalt and bracing bridges, McMurry said.
In the future, the state may also be able to take approach similar to Florida’s, in which it would apply state funds to new construction, while reserving federal funds for maintenance.
McMurry said that doing so would save money by removing many of the regulatory hurdles to getting new construction projects completed.
Georgia has been losing ground in taking care of things. The Reason Foundation ranks the performance of state highway systems according to rural and urban pavement conditions, fatalities, congestion and other measures. In 2008 Georgia ranked ninth; in 2012, 12th; in 2014, 13.
The influx of new money helps Georgia put the brakes on that decline, McMurry said. “Where this puts us is to be able to stop the downward curve of service levels and conditions, allowing us to flatten it out and pull it back up,” the commissioner said.
And that will have to do, for now.
‘This was the one bite at the apple’
Deal has said that he won’t back another major push for infrastructure revenue during his second term. The plan, he said, will meet the state’s needs “for the short term and a longer period of time.”
“This was the one bite at the apple,” he said. “And I’m glad the General Assembly had the courage to do that,” he said. “And I think, looking back, we’ll all be glad that we did. We are not going to be a state that’s behind the curve.”
It’ll take a few years for all of the new revenues to start flowing into state coffers because the new taxes and fees take effect on future dates.
For instance, the fees on electric vehicles will take effect July 1. The hotel/motel fee kicks in at the same time. The jet fuel and electric vehicle tax exemptions end this summer.
The new gasoline excise tax takes effect July 1, 2016.
Staff writer Greg Bluestein contributed to the story.