Georgia lawmakers approved a transportation funding plan late Tuesday night that they said will raise $900 million through changes to the state’s gas tax and new fees on electric cars and hotel visits.
The compromise between House and Senate versions of the plan hinged on the amount of excise taxes people would pay per gallon on gasoline, with proceeds dedicated to transportation.
Lawmakers set that at 26 cents per gallon, with diesel fuel at 29 cents per gallon, and expect it to raise $700 million.
In a statement Wednesday, Gov. Nathan Deal said he would sign the legislation.
“The benefits of these new projects will appear in full view,” Deal said. “Georgians will soon see the road crews and the orange cones and smell the hot asphalt as it’s poured. That’s the short term. In the long term, they’ll drive on better roads and bridges, giving us not only a better ride but also peace of mind.”
Converting Georgia’s existing mix of charges on gasoline to a dedicated tax ensures the revenue will be used for transportation. The compromise number “meets in the middle” of previous House and Senate versions of the bill, House Transportation Chairman Rep. Jay Roberts, R-Ocilla, said.
Deal, other Republican party leaders and the state’s business community deemed a transportation package the session’s top priority before the legislative session kicked off in January. A study committee recommended $1 billion was needed just to maintain Georgia’s existing roads and bridges — and far more would be necessary to upgrade or expand infrastructure of all types.
“Unlike health care and education, there aren’t entitlement mandates that transportation spending keep up with the population growth in our state,” Deal said. “The gasoline tax has long paid for our roads; it’s the most fair fee that you can create because those who use the roads are the ones who pay for them.
“But our gas tax has stayed the same since the early 1970s. Over that period of time, with inflation and the significant increase in fuel efficiency, drivers are paying significantly less per mile traveled. We not only lacked the resources for new transportation projects, but had also reached the point where we couldn’t afford to maintain the roads and bridges we already have.”
The pressure-packed debate has engaged and occasionally upset wide varieties of Capitol onlookers, from anti-tax organizations to local school districts.
Rep. Emory Dunahoo, R-Gainesville, said he missed Tuesday’s vote because of family obligations, but would have preferred the excise tax on regular and diesel gas be set at 24 cents, as the House had initially approved.
The Senate had pushed for a 29-cent tax for regular gas.
“I don’t like a lot in the bill,” Dunahoo told The Times. “It is a tax. But we might as well roll up our sleeves. ...
“Even though I don’t like what all this is doing in general ... I’m ready to go down the road and let’s see what it does.”
Dunahoo said he hoped the transportation bill would act as a kind of pilot program to address the state’s needs. He hopes lawmakers will be willing to consider adjusting the excise tax in the coming years based on those needs and economic conditions.
After the House vote, Speaker David Ralston, R-Blue Ridge, credited members with a “tough” vote.
“I acknowledge that,” Ralston said. “This General Assembly was tasked with doing what other general assemblies have kicked down the road, and they met that challenge tonight.”
State Sen. Josh McKoon, R-Columbus, criticized the rush before voting no.
“It cannot be denied that what is before you is a massive tax increase,” McKoon said.
All but one Democratic senator voted for the transportation bill. Democrats supported a companion bill that provides MARTA with additional resources.
“We know transportation is key to economic stability in Georgia, so we are glad some measures have moved forward, which offer hope that Georgia will not fall behind other Southeastern states in addressing our transportation and transit needs,” Senate Democratic Caucus Leader Steve Henson said in a statement to The Times.
A variety of other changes help make up the funding total, including:
A new $200 fee on electric vehicles.
A new $5 per night hotel or motel fee.
A new fee on heavy trucks, $50 or $100 annually, dependent on weight.
The elimination of the state’s generous $5,000 tax credit for new purchases or leases of electric cars after July 1. Supporters had hoped to have the credit phased out.
The elimination of a tax break on jet-fuel purchases at Atlanta’s Hartsfield-Jackson International Airport. The break had benefited one of the state’s largest companies, Delta Air Lines, and other airlines.
The proposal also lets local governments continue to collect local taxes on gasoline sales, but caps the maximum price per gallon at $3 to calculate those fees. In addition, the bill sets up a complicated process for counties and regions to impose additional local taxes for transportation needs with some limits on how much they can charge.
Out of the 7 percent sales tax currently levied on gas in Georgia, 4 percent goes to the state and 3 percent to local governments. From the 4 percent, 3 percent goes to the Georgia Department of Transportation, with the fourth percent — dubbed “the fourth penny” — going to the state’s general fund.
Gainesville officials passed a resolution in February opposing the initial transportation bill, which called for at least $1 billion in funding.
City Manager Kip Padgett said the original proposal would have cost Gainesville about $1.1 million annually.
It is unclear how much local government could lose now.
“Hall County officials are currently reviewing the details of (the bill) as passed,” spokeswoman Katie Crumley said.
Dunahoo called on the public to hold lawmakers accountable for how transportation funding is spent “to make sure this money has done what it’s supposed to do.”
“We don’t have to have $1.5 billion every year,” he added. “We need to do a better job spending our money.”
The Associated Press
contributed to this report.