Atlanta Voters Defeat $8.5 Billion Tax for Transportation

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Atlanta Voters Defeat $8.5 Billion Tax for Transportation
August 1, 2012
By Margaret Newkirk
BloombergBusinessWeek

Voters in Atlanta and its suburbs, among the most traffic-congested areas in the U.S., defeated a proposal for a 1 percent sales tax to raise $8.5 billion for roads and public transportation.

The levy was failing 63 percent to 37 percent, with 99 percent of precincts counted yesterday in the 10-county region, according to the Associated Press.

The vote was a loss for business and political leaders who said improvements were needed to attract jobs and reduce commuting delays. Opponents included Tea Party activists, who advocate less government spending, civil rights leaders from the NAACP and environmentalists from the Sierra Club.

“This is a win for the people,” said Debbie Dooley, founder of the Atlanta Tea Party. “We thought it would be closer than it was. This was about a lack of trust of elected officials.”

Roads and mass transit haven’t kept pace with the region’s needs, supporters of the referendum said. Average drive times are the 11th longest in the nation, according to a study last year by the Texas Transportation Institute at Texas A&M University. Georgia’s per capita spending on transportation averaged 48th in the country from 2003 to 2009, according to the Atlanta Regional Commission, a planning agency, citing U.S. Transportation Department and U.S. Census data.

The Atlanta area ranked seventh among metropolitan regions in numeric population growth in the year ending July 1, 2011, according to Census estimates.
Existing Taxes

The 1 percent levy would have been added to county taxes of 2 percent to 3 percent and a 4 percent state sales tax. The tax would have ended after a decade, or when its revenue goals had been met, whichever came first. The tax would have generated an estimated $8.5 billion over 10 years, adjusted for inflation, according to supporters.

The National Association for the Advancement of Colored People opposed the measure because the two counties that include Atlanta have paid a 1 percent sales tax for 40 years to support bus and rail service in the region, while the suburban counties haven’t, said John Evans, president of the DeKalb County chapter.

A needed rail line to predominantly black neighborhoods wasn’t included in the list of projects to be funded by the tax, while a line to a largely white suburb was, Evans said.

The Sierra Club said the project list included too many roads and not enough mass transit, according to Colleen Kiernan, director of the group’s Georgia chapter.
Party Lines

Democratic Atlanta Mayor Kasim Reed praised supporters of the tax for coming together across party and jurisdictional lines, said his spokesman, Reese McCranie.

“He said he recognized that some people have a distrust of government, and that people need to realize that the government is just a collection of us,” McCranie said. “The politics of cooperation is the way we move forward as a region.”

The tax would have been dedicated to 157 mass-transit and road projects designated by political leaders from the counties considering the increase.

The money would have paid for a new rail line to the Atlanta suburb where the U.S. Centers for Disease Control and Prevention has its headquarters, and improvements to a congested highway interchange north of the city.

Supporters of the measure included Republican Georgia Governor Nathan Deal, Atlanta-based companies such as Coca-Cola Co. (KO) (KO), Delta Air Lines Inc. (DAL) (DAL), United Parcel Service Inc. (UPS) (UPS) and Home Depot Inc. (HD) (HD)

Failing to reduce traffic congestion hurts efforts to attract businesses, said Paul Bowers, president and chief executive officer of Georgia Power, an Atlanta-based subsidiary of Southern Co. (NSC) (NSC) Georgia Power donated to the campaign for the tax.