Investing in metro Atlanta’s future; lots of infrastructure needs but few dollars to spend

By Maria Saporta

Over the years, metro Atlanta’s leaders have been willing to invest in our future.

There was Atlanta Mayor William Hartsfield, who had the foresight to see the future of aviation and positioned the city to become a leader by investing in the building of a major airport.

In the 1960s and early 1970s, there were Atlanta mayors Ivan Allen Jr. and Sam Massell, who promoted the development of a modern transit system — MARTA — a rail system first envisioned to serve five counties instead of the current two.

Allen also understood how professional sports teams would help give Atlanta national stature.

Atlanta Mayor Maynard Jackson reinforced Hartsfield vision by championing a major expansion of the airport — and using the massive public works project as a way to help integrate the city’s economy by encouraging minority-majority joint ventures.

And Atlanta Mayor Shirley Franklin led an effort to reinvest in the city’s decaying sewer infrastructure.

These all were massive investments led by the City of Atlanta to catapult the region into world-class status among cities. The leaders found a way to invest in their visions and build the foundation for the next generation.

But now the region’s infrastructure needs have outpaced our ability to pay for them. And the vision of where we need to invest our money has become much cloudier and complicated.

So here we are in 2011 — a time when the federal, state, county and city governments have little to no money to invest in its current and future infrastructure needs.

The Urban Land Institute’s Atlanta chapter held an all-day Infrastructure Summit on May 24 at the Georgia World Congress Center with the title — “A Region at the Crossroads.”

Maureen McAvey, ULI’s national executive vice president of policy and practice, put it in a global perspective.

“China currently is spending $1 trillion in the next five years on its infrastructure,” McAvey said. “It will have 10,000 miles of high speed rail by 2020. In the United States in 2020, we will have zero.”

McAvey said the American Society of Civil Engineers have estimated that the United States should invest $2.2 trillion in its infrastructure in the next five years. But there is little appetite among taxpayers to spend that money. As McAvey said, the nation’s gasoline tax has been at the same rate for 18 years, and there is little willingness to increase it to pay for our growing infrastructure needs.

It’s a far cry from the 1950s when then President Ike Eisenhower had a vision to connect our nation with an interstate system and to pass a gasoline tax to pay for it.

At that time at least, there seemed to be a willingness to tax ourselves when we believed the money would be invested in a vision that could unite us.

In the City of Atlanta alone, it has been estimated that its infrastructure needs, including fixing our roads, bridges and sidewalks, total about $750 million. Atlanta Mayor Kasim Reed, who has pledged to not raise the city’s property taxes, has been promoting sales taxes as a way to pay for at least some of our needs.

The most openly debated one penny sales tax is the regional transportation sales tax that will go before voters in the 10 metro counties next year. That would raise about $8 billion over 10 years and would be invested in a yet-to-be-determined list of transportation projects, including everything from roads to rails to sidewalks.

Mayor Reed also is planning to seek an extension of the one penny sales tax to finish the investment in the city’s water/sewer system.

And then, Reed is a strong supporter of a bill that would allow communities throughout the state to pass a fractional sales tax that could go to funding the arts, other quality of life and economic development initiatives.

That measure has come close to passage in the past two legislative sessions, and Reed is hopeful that it will pass in the near future.

“At the end of the day, we are going to pass a fractional tax in the state and in the region,” said Reed, who believes that the fractional tax will give Atlanta and its cultural institutions a dedicated funding source. “There’s no excuse for a city like ours to no have perpetual funding of at least $10 million every year.”

The fractional sales tax also could go to other areas such as parks and green space, which currently are facing drastic budget cuts in the city.

“I’m going to be a champion,” Reed said of the fractional tax effort.

But Reed is equally committed to making sure that the one-cent sales tax for the rebuilding and renovation of Atlanta’s public schools does not get renewed.

“It’s not going to happen,” Reed said. “There is no path for a full penny for the City of Atlanta school system. There’s no political will for it. It’s not needed.”

Plus, Reed is extremely sensitive to the sales tax burden that would be in the City of Atlanta if the school tax, the transportation sales tax, the MARTA tax and the sewer tax were all being levied.

“We can’t have a 9 cents sales tax rate,” Reed said. “None of our citizens are going to agree to being a 9 percent sales tax community.”

The Atlanta region, and the nation as a whole, is in a peculiar spot. The need to reinvest in our communities is as great as ever. But there’s little willingness to pass a tax increase to pay for that reinvestment.

Catherine Ross, director of Georgia Tech’s Center for Quality Growth and Regional Development said it best during a panel at the Infrastructure Summit.

“You can’t have everything and pay for nothing,” Ross said.

Maria Saporta, Editor, is a longtime Atlanta business, civic and urban affairs journalist with a deep knowledge of our city, our region and state.  Since 2008, she has written a weekly column and news stories for the Atlanta Business Chronicle. Prior to that, she spent 27 years with The Atlanta Journal-Constitution, becoming its business columnist in 1991. Maria received her Master’s degree in urban studies from Georgia State and her Bachelor’s degree in journalism from Boston University. Maria was born in Atlanta to European parents and has two young adult children.

13 replies
  1. Will the last Democrat in Georgia please turn off the lights?.... says:

    Two words: USER FEES!

    Welcome to the big leagues, Atlanta. Atlanta wanted to be big time and it got big time with the explosive population growth of the metro area and part of being big time is that your taxes go up, often times WAY UP, just ask any resident in Illnois, New York or California. Chicago has a sales tax burden of over 10 percent (10.25% to be exact which is the highest of any incorporated city in the nation, if I’m correct).

    The City of Atlanta can choose to follow the lead of city governments in Chicago, NYC and LA by raising its taxes to a level that discourages investment within the city limits or it can try a different approach by lowering the overall tax burden and maybe implementing targeted user fees where needed. By lowering the overall tax burden city government may have to do without in the short term, but the level of investment stimulated within city limits will help to pay for infrastructure improvements over the longer term. Sales taxes would probably be a more preferred way of raising revenues if you feel that you absolutely must go the tax route as sales taxes spread the burden of paying over more of the population (renters, tourists, conventioneers, out-of-towners and people who don’t pay property taxes inside the incorporated area) than does property taxes which are only paid by property owners, but government has to be careful not to overuse and abuse the very much tempting power it posesses to just simply take more revenue whenever there is seemingly a need to pay for something, whether real or perceived, which is always.

    The City of Atlanta and other governing entities should be careful not to follow the lead of the State of Illinois which just raised their corporate taxes by a blistering 64 percent in a misguided effort to increase revenues during a very soft economy leaving the state vunerable to lose existing business and industry in the state to other locations with a significantly lower tax burden (Georgia is one of the locations that Sears, whose headquarters are in Illinois, has threatened to relocate to as a result of the dramatic tax increase).

    USER FEES might be a more effective way of paying for those necessities as ONLY THE PEOPLE WHO USE THAT PARTICULAR SERVICE PAY THE FEE to plan, build, manage and maintain it. That doesn’t mean that governments should stop levying taxes, but that taxes should be prevented from spiraling completely out of sight by being capped and even reduced so as to not to discourage much-needed investment by private business and industry as costs for services are targeted at people who use that particular service.Report

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  2. Will the last Democrat in Georgia please turn off the lights?.... says:

    By the way, whatever you do, absolutely, postively be sure NOT to call any new user fee a TAX. Saying you’re going to pay for something with a new tax in this strong Tea Party-dominated anti-tax climate is a sure-fire way to make sure that it doesn’t get paid for or funded. Best of luck to those pushing the proposed new transportation sales tax because they’re REALLY gonna need it…Report

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  3. Matthew Porter says:

    Pound Foolish—The regional penny tax/fee/fundraiser is the most sensible and equitable to pay for transportation infrastructure improvements. I wonder what rail lines into Marietta, Kennesaw, Lawrenceville and Duluth might would cost today compared to their cost 40 years ago when its relatively homogenous population rejected MARTA fearing…. what? People of color (other than ivory) overrunning their horrible strip malls? Traffic is the rope ostrich-headed citizens of Cobb and Gwinnett wove to hang themselves. While I would like to enjoy the schadenfreude of my country county cousins’ trans problems today, I should not. As Gwinnett and Cobb go, so goes Fulton and DeKalb. Our collective fortunes (and our clogged roads) do not stop at county lines, do not discriminate by race and do not give a hoot about one’s political affiliation. If the best non-eleted leaders, friends, family member and neighbors cannot convince the Not On My Life self-destructive attitude to vote “yes” on the 1 cent sales tax prop, we will all be left hanging from a rope of transportation small-mindedness. And 40 years hence? I envision hundreds and hundred of miles of empty roads and parking lots from Austell to Athens, from Clayton to Cobb. The birds and animals shall rejoice at our stupidity.Report

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  4. Charles Ball says:

    Atlanta’s reticence about making major investments in its infrastructure appears to be common in this part of the country (the South). Many in the South like to chalk that up to our conservative natures. However, I find it interesting that many conservative states in the West and Southeast seem to be willing to ante up to ensure that their infrastructures are state-of-the-art. This is the case whether we are talking mass transit, or smart highways, or telecommunications are alternative energy. Bottom line: Being conservative should not be an excuse for allowing our infrastructure to crumble.Report

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  5. Carrie L. Williams says:

    True public engagement is a critical need in Atlanta, and across the nation — your article demonstrates that need. A viable process for that engagement has yet to emerge, howevere, I am passionate about collaborating with others to see its development in my lifetime. Your report is insightful and absolutely accurate — and we must collectively do better than this to create the lives for ourselves and our children that now, more than ever, should be within our reach, despite our economic challenges.Report

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  6. What have you done for us lately? says:

    I don’t think the question is whether the Atlanta Metro area should invest in its future (i.e. infrastructure). I think the question is whether voters trust the politicians to invest additional tax dollars wisely. Why continue throwing money at a wasteful, corrupt system? Don’t come to me asking for another penny when you can’t manage the income tax, sales tax, property tax, ad valorem tax, gas tax . . .etc. . . .I already gave you.Report

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  7. Will the last Democrat in Georgia please turn off the lights?.... says:

    SpaceyG: The 2012 referendum can pass and if it does happen to pass it’ll be by a slim margin probably getting not much more than 50% of the vote and will need the considerable help of a very robust public relations campaign which is as of yet to start. The 2012 referendum and any future transportation improvements will also need the help and leadership of elected officials at the regional and state levels seeing as though the Atlanta Region now stretches over an area of up to 8,400 square miles and consists of anywhere from at least 10 to a maximum of 30-plus counties depending on whose geographic definition is used. Residents in the actual City of Atlanta, which has a population of around 420,000, only make up about just over seven percent or one-fourteenth of the total metropolitan population so a Mayor Kasim Reed does not hold the same sway over Atlanta’s urban politics that a Mayor William Hartsfield or Mayor Ivan Allen did when the metro area had a much lesser population and area, meaning that any urban undertakings absolutely must include the cooperation of the other political leaders in the Atlanta Region and state.

    When it comes to funding an initiative like transportation, taxes should NOT be the ONLY way that is used to pay for roads, buses and rails. If this proposed sales tax is voted down, instead of just being dead in the water so to speak, there should be other options of paying for transportation needs and wants like user fees, tolls and higher fares. We can’t just throw our hands up and quit if we don’t get this new tax approved in an increasingly tax-averse climate. We have to find alot more creative ways of funding critical infrastructure (and education, etc) needs than always just levying a new tax or taxes which means that people who use a particular service like a road, bus, train, school, etc may have to pony up more if they want to being able to keep using a particular service.

    Motorists as an individual group may have to pay tolls and user fees based on miles driven if they want better roads, bicycle riders as an individual group may have to pay a few dollars more if they want more bike paths and bike lanes, transit riders may have to pay higher fares if they want more and better buses and trains.

    Every interest group absolutely has to take into account and be considerate of the challenges of the current political and economic climate and be willing to be flexible to adjust to them when asking for the public to pay for what they want and transportation advocates are no more different or special. I’m just saying that in an political and economic environment that is understandably hostile to new and existing taxes, that there are other ways to pay for transportation improvements than just to levy a new tax on top of an already high enough tax burden.Report

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  8. shirley says:

    Maria,
    Thanks for continuing the public discussion about infrastructure investments needed and long overdue in Atlanta and the close in metro counties. The needs exceed the local residents’ capacity to pay the full bill. Let’s hope the Governor is inclined to adjust the state funding model to add a revenue sharing model for all GA cities and towns which is typical in nearly every state but not Georgia. Regarding the Savannah Port- Has Congressman Kingston weighed in? If so, why haven’t we heard about his efforts as a senior member of the House Appropriations Committee? Funding complex infrastructure isn’t easy but possible. Hence the years of Atlanta mayors championing investment in the airport that has made HJAIA the dominant passenger airport in the US and the busiest in the world for nearly a decade. The business/financial model was well defined some 30 years ago and negotiated in the airlines master lease by Mayor Jackson and refined to accomodate the expansion needs by succeeding mayors along the way. Similar models must be developed and negotiated for expanded metro transit and MARTA assuming the upcoming referendum passes. Money alone will not solve traffic congestion, increase transportation accessibility and improve air quality. One of my favorite Covey principles is “begin with the end in mind”. The end isn’t money. The end is efficient, effective service that supports a vibrant and sustainable community. Just as the end game for the Atlanta’s water and sewer investments is clean, accessible water for residential, business and recreational purposes. Hopefully, your coverage about infrastructure will lead to more discussion about the community goals, the end game, not just the money.Report

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  9. Rebecca says:

    Shirley makes a great point when she says “The end is efficient, effective service that supports a vibrant and sustainable community.” I couldn’t agree more. I haven’t seen much, if any, discussion in the coverage of the proposed transportation sales tax about bicycle infrastructure, which if any Atlanta lacks more sorely than anything, with the possible exception of mass transit.

    While we need to maintain our existing roadway infrastructure, it’s a little disheartening that non-Saporta coverage continues to talk about “congestion projects” as if the we hadn’t disproved the model of widening roads to accommodate peak-hour traffic everywhere we turn in metro Atlanta.

    On my bike commute home last night, someone standing on the sidewalk yelled, “way to save gas money!” With gas prices likely to continue to rise over the 10 years this tax would cover, investing in those modes that make us independent of externalities like the availability of cheap gasoline is not just smart, it’s the necessary wave of the future.

    Lastly, while I strongly support the T sales tax, let’s have some discussion of how it affects those in the bottom income brackets, who pay a much higher percentage of their income as sales taxes increase. That’s not equitable, especially since many of those folks are already bearing an unequal burden in our transportation system if they are transit-dependent and spend many extra hours waiting on those buses that come more and more infrequently. They stand to gain a great deal if transit service, not just new projects, is improved, but they also will pay for it more dearly than those in the highest brackets.

    I just think we need to acknowledge that, and continue to look for more creative funding mechanisms to fund the remaining gaps, like the parking user fee put forth in the Connect Atlanta Plan passed in 2008 (bad timing, good plan).Report

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  10. Will the last Democrat in Georgia please turn off the lights?.... says:

    Rebecca says:
    June 2, 2011 at 8:27 am
    “Lastly, while I strongly support the T sales tax, let’s have some discussion of how it affects those in the bottom income brackets, who pay a much higher percentage of their income as sales taxes increase. That’s not equitable, especially since many of those folks are already bearing an unequal burden in our transportation system if they are transit-dependent and spend many extra hours waiting on those buses that come more and more infrequently. They stand to gain a great deal if transit service, not just new projects, is improved, but they also will pay for it more dearly than those in the highest brackets.”

    Rebecca, I get your point about higher sales taxes being a higher burden on lower income people, but we also have to take into account that paying a little more for dependable transit service is much less of a burden on lower income people than having little or no transit service at all.

    I’m pretty sure that losing and being without bus service for over a year, transit-dependent residents in Clayton County would have chosen to pay more so that they could have kept their bus service operational as opposed to having no bus service and either having to pay much more to buy and maintain a personal vehicle, pay much more for a cab or if those are unaffordable, just simply have to walk to where they’re have to go.

    I do agree that we need to employ more creative funding measures, such as the parking user fees you cited, to pay for transit as sales taxes alone will not pay for transit and further tax increases are politically impossible.

    The fact remains that user fees in the form of higher fares are unavoidable and very necessary to pay for better transit as taxes just don’t and won’t go far enough. Fares are as high as $5.00 one-way to board the Metro rail and bus system in Washington D.C. which is like a sister city to Atlanta in many ways. The $3-$5 fares are in addition to sales taxes in D.C. Metro Area which are a little more comprehensive.

    To pay for the type of service that this town sorely needs and with the lack of financial support from the region or the state, $2.00 fares just are not gonna cut it for a hamstrung urban system like MARTA.Report

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  11. writes_of_weigh says:

    A paraphrased or possibly precisely quoted favorite goes something like “those who don’t know history are doomed to repeat it.” In terms of paying for these “new” systems, why is it that the Trans-literati remain all “lathered up” over paying repeatedly for somethings(quite valuable) they already own, and have some influence over vis-a-vis our “purchased and paid-for” elected officials, who either know and are not telling, or are just keeping quiet to remain “in the loop”, when they really are clueless, and do not deserve your hard earned and repeatedly frittered-away tax dollars.
    To wit: The Georgia citizen owned(managed by the State Property Commission) Western and Atlantic Railroad right-of-way between the Zero Milepost (near the State owned Sloppy Floyd Building)through Vinings(near I-285/I-75 commerce centers) and Marietta and Cartersville and Ringgold to the state line, a leased(currently to CSX Corp.), heavily utilized Class 1 mainline(it’s alternate route(via Birmingham, AL) to/from the Midwest(i.e. Nashville, Chicago) is more distant and has a higher gradient = more costly to operate) is the “diamond in rough” awaiting commuter train operations in the Metro area. The people’s lease of this property to CSX is reportedly nearing a renewal, and now might just be the time to “drive a hard bargain” in terms of commuter train(s) operating rights/authority(dispatching) and maintenance over any CSX lines in the State of Georgia, which might immediately or in the future be good conduits not only for freight traffic moving from Georgia’s ports(Savannah, Cordele(Inland),Bainbridge, Columbus, Brunswick) but for passenger/commuter/H-S-R movements to/from those cities. NOW…..
    just wait ’till I “weigh” in Norfolk Southern’s Amtrak member railroad(the Central of Georgia)
    and it’s routes throughout the State of Georgia which Amtrak was contractually obligated to consider intercity service upon on it’s(Amtrak’s) inception, way back yonder in ’71, and the Central’s obligation to maintain the route(track and safety/dispatching/signal) systems if needed in the future. Why o why the Georgia Railroad Association and it’s member railroads are so “silent” on these subjects, is your guess as good as mine. It’s as if an FRA “quiet zone” has been implemented across the State. But remember…it’s all just sandhouse(talk) er ………not.Report

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