The Transportation Funding Act of 2015
Friday, February 20th, 2015 @ 6:12PM
The Transportation Funding Act of 2015 or HB-170 was passed out of the full Transportation Committee on this past Wednesday at around 4:30pm. As this bill is currently, I cannot support it! I will be among the first to admit that transportation and infrastructure issues are major problems Georgia is currently facing, and we must stop kicking this can down the road.
As currently written, this legislation will affect the local government’s revenues on fuel sales. This will result in over $5 million of lost revenue to our cities and the county government in Walton County alone. Cities and Counties would be forced to raise taxes to make up the loss in revenues.
The second issue that prevents me from supporting the plan is we have not been given a plan for transportation spending. There are plenty of transportation projects talked about, but before we spend over $1 billion per year for the next 20 years we should see a plan to improve transportation in Georgia.
It is important that we address transportation and start this year. Therefore, I will be introducing legislation that gives a good start in transportation funding. The bill will change to an excise tax from a sales tax. This includes the “4th penny” so all 4% currently charged on fuel will go to an excise tax and used for transportation. The calculation will use the 4 year index of $3.39 setting the excise tax at 13.5 cents per gallon. The fiscal review sets this change at an additional $152 million dollars. Commercial trucking is eligible for a Federal tax credit for excise tax that currently leads to less diesel fuel purchased in Georgia. A conservative estimate is the change to an excise tax will generate an additional $60 million from the increased diesel sales.
The bill will address alternative fuel vehicles that use no gas and currently pay $0.00 for transportation infrastructure. The alternative fuel vehicles will have a $200 annual tag fee, $300 for commercial vehicles, used for transportation. Currently there is no other mechanism for alternative vehicle fuels to support transportation funding. And finally the bill will repeal the tax credit for electric vehicles. It total this bill should bring in nearly $300 million in annual revenue for transportation.
Additionally we need to look at the organic growth in revenue in the 2016 FY budget and beyond. We are still $500 million below the State’s highest budget. As the economy comes back, as the new businesses in Georgia continue to grow, there will be a growth in revenue. We should direct a majority of the new revenue to transportation issues and not put money back in programs that have previously been cut, before any tax increase. The current 2016 budget plan does call for a $200 million in bonds to address critical and immediate needs. This will help, but using bonds for transportation infrastructure is not a long term or multiple year solution.