Notes from the Georgia State Senate
Joint Panel to study best solutions for transportation funding
By STATE SEN. CHIP PEARSON

Georgia has become the hub of transportation in the southeast U.S. for travel all over the world. This fact was confirmed last week by the Federal Aviation Administration (FAA), as the agency announced they would award nearly $40 million in grant money to Hartsfield- Jackson International Airport for safety and capacity improvements. At this point in time, the leaders of our state are also looking at ways to plan for further population growth, which could greatly affect our current transportation infrastructure. Whether it's roads and highways or runways and aprons, we need to find the best solutions to improve our infrastructure, so that decades from now traffic will not be constant gridlock and jet travel will not be constantly delayed.

Transportation is essential to Georgia's economy. It's essential to getting the citizens of Georgia to work to the doctor and to school. Transportation is crucial to the tourism industry, and to every facet of our daily lives. Because efficient transportation is so critical to our quality of life, I co-sponsored Senate Resolution 365 during the 2007 session. SR 365 created the Joint Study Committee on Transportation Funding, and I am pleased to announce that I have been appointed to this study committee along with other members of the General Assembly.

Often, we hear new ideas on how to improve Georgia's roads and highways, and how to fund these plans. This year, we've heard all kinds of ideas to improve our road and highway system, ranging from HOV lanes to HOT lanes to flex lanes to truck-only lanes. We've also seen proposals from the Department of Transportation calling for an overhaul of our transportation system, including truck-only lanes, mass transit projects, a connector of I-75 and I-85 in north Georgia, the repair of old bridges and other road work. The General Assembly needs to study all of these ideas and determine the best funding mechanism possible for any major transportation project.

According to recent statistics, Georgia is ranked 51st in the nation when it comes to the amount of state disbursements per capita for highways at $228.15. At first, this fact appears troubling, yet the same source also ranks Georgia first in the condition rating of our interstates, freeways and arterial roads. This would indicate that our current transportation funding is adequate, and that the capacity of our roads and interstates may be the issue. The Joint Study Committee on Transportation Funding will meet across the state this summer to look closely at these statistics and facts to determine how the cost of new lanes, on/off ramps and any other new transportation initiative should be funded. Should roads be funded by a tax or should they be funded by fees charged to those who use our transportation system the most (tolls, lane fees, etc.)? Also, should we promote alternatives like flexible work schedules, telecommuting and flex lanes during the rush hours on a statewide basis?

Gas Tax issues

I have heard the concerns of some of my constituents on the high price of gasoline this summer. Let's take a quick look at how we pay the gas tax in our state. The current Georgia Motor Fuel Tax was enacted in 2003 (House Bill 43). Georgia law requires a twice a year adjustment to the state's gas tax to reflect the percentage against the price per gallon. This occurs in January and July. There is also a midterm adjustment that is required if average gasoline prices fluctuate more than 25 percent; this recently occurred on June 1, 2007.

On June 1, the three percent rate rose from 7.7 cents to 9.8 cents, and the four percent rate rose from 5.7 cents to 7.4 cents per gallon. Georgia law requires this automatic adjustment because average gas prices have risen drastically; the converse could be the case if gasoline prices dropped drastically. This is a total increase of 3.8 cents per gallon.

Notice that the fluctuation applies to the percentage and not against a set rate; therefore, the higher the price per gallon, a larger percentage is paid in motor fuel tax. Conversely, the lower the price per gallon - the lower the tax. When motor fuel prices were in the $1.50 range, Georgia offered the lowest motor fuel prices in the nation, and this is due, in part, to the percentage requirement. Keep in mind that any state gas tax collected can only be used for the purpose of road and bridge improvements in Georgia.

Readers also should note that:

· Tennessee levies 20 cents per gallon for motor fuel tax which is added to a one cent "special tax" for a total of 21 cents per gallon.

· South Carolina's motor fuel tax rate is 16 cents per gallon; this is a fixed price so there will be no tax fluctuation as the price of a gallon of gas decreases.

· Alabama levies two tax rates on gasoline. Two rates of 12 cents and four cents per gallon mean 16 cents per gallon of gasoline.

· North Carolina levies 30 cents per gallon. This includes an inspection fee that is added to the state excise tax on motor fuel.

So, while our current state gas tax is slightly higher than South Carolina and Alabama, it is significantly lower than the states of Tennessee and North Carolina. Also, as gas prices ease back down toward $2.00 per gallon, the gas tax will decrease in Georgia as well. In 2005, the gasoline tax was suspended because of a state of emergency in which several major oil refineries went "offline," and Governor Perdue and the Legislature opted to provide relief to Georgia citizens in this fashion.

Since the gasoline tax is in a state of flux, it may not be the most reliable funding mechanism for our state's transportation system. So, we must consider if roads should continue to be funded by the current gas tax, by some type of "user fee," by a flat tax or some other type of assessment. One thing is clear - from a public safety and economic development standpoint - we must arrive at a solution for transportation funding in Georgia that is practical, cost effective and fair, because efficient transportation is necessary and important to all citizens. These are the kinds of questions we'll look to answer this summer and possibly craft legislation for the 2008 session.

Please feel free to contact Sen. Chip Pearson at his office in Atlanta at 404.656.9221 or by email at chip@team51.org.