MARTA sales tax ‘menu’ overstates the transit it will fund

Atlanta City Council last week approved a half-penny transit sales tax for the Nov. 8 ballot. But it’s still unclear what projects that tax would fund.

State legislation making the tax vote possible requires MARTA to come up by the end of July with “a final list of new rapid transit projects within or serving the city to be funded in whole or in part by the proceeds of the tax.”

MARTA and city officials are interpreting that as a fungible “menu.” As MARTA spokesman Lyle Harris, put it in an email:

Contrary to popular belief, there is no formal list for the MARTA projects that could be funded if voters approve the half-penny transit referendum in November. Rather, MARTA and the City are collaborating on a “menu” of potential projects to choose from that would be prioritized for implementation based on a number of factors, such as the availability of matching federal funding that could be used to pay for them.

The half-penny is projected to bring in $2.5 billion over the tax’s 40 year life. Expenses for the projects on the “menu” approved by Council last week appear to be more than double that amount.

A MARTA presentation prepared before the Council vote put capital costs for the projects on the “menu” at $6.9 billion. MARTA assumes (perhaps optimistically) that $3.1 billion of that would come from the feds, leaving $3.8 billion in local costs. The project list endorsed by City Council added a couple more projects, but the final number isn’t likely to be vastly different from that $3.1 billion bottom line.

In addition, the tax is supposed to contribute to operating expenses of the projects it funds. According to the MARTA document that’s another $4.5 billion, although MARTA’s Harris cautions that the amount going from the sales tax to operating costs “will be dictating by the program of projects that are defined and the amount of sales tax revenues that would be available on an annual basis.”

Finally, bond financing — necessary if we want the projects completed in something less than four decades — will take another hefty cut out of the $2.5 billion. With the upfront money from bond financing, express bus systems could be put in place within two years, while rail lines of various thoughts could take eight to 12 years.

So after campaigning for the half-penny tax based on one list of projects, Mayor Kasim Reed, City Council and MARTA will have to trim the list significantly — perhaps by more than half — after the tax is approved.

“After the November referendum, if it passes, MARTA will work the City of Atlanta to determine which projects will move forward, and when,” according to Harris. “We have committed to a series of public meetings with the Council and key stakeholders to select projects from the menu of projects that we have proposed.”

This menu approach differs from the firm project lists that counties and cities are required to prepare in advance of any Special Local Option Sales Tax, or SPLOST, referendum. But city officials did present voters with a more expansive list of projects than could be funded in advance of last year’s vote to fund infrastructure improvements through property taxes; that prompted after-the-fact complaints from neighborhood groups who thought their communities would get a lot more for helping city officials to campaign for the referendum.

There’s a reasonable explanation for the decision to use a “menu” as opposed to a firm list. As Harris notes, it’s hard to gauge at this point which projects will gain what amount of federal funds and clear various other pre-construction hurdles. State lawmakers didn’t make preparing for the November referendum easy by waiting until very late in the session to approve the legislation. Gov. Nathan Deal finally signed the bill April 26, leaving little time to fine tune the list before making various deadlines related to the November referendum.

And the bottom line is that even a third of the projects on the list truly transformative for the city. Among them: Beltline transit linked to network of five other light rail lines, five new MARTA stations, and and five bus (or “arterial”) rapid transit routes. Here’s the full list as approved by City Council.

At the same time, as one Atlanta City Council member emailed to me “[It’s] not so much bait and switch, since the final projects have to come from this list … but it does make folks think everything could get constructed when that obviously is not the case.”

Relevant documents

Senate Bill 369 as passed (MARTA sales tax legislation)

MARTA June 20 project presentation

MARTA Projects Itemized as approved by City Council

 

By | 2016-06-28T12:31:04+00:00 27 June 2016|Bus & Rail, TRANSPORT|0 Comments

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