With the recent news that Georgia ended the 2006 fiscal year with a $600 million surplus, state legislatures have been clambering for a special session to vote on giving the collected funds back to state taxpayers through either new tax cuts or rebates. However I believe this would be the absolutely wrong thing to do.
Now before all you fiscal conservatives cry 'foul' and start looking around for your tar and feathers, let's consider a few facts shall we.
The Georgia Department of Transportation is facing a $7.7 billion shortage in funding. This is a huge shortage especially for a state which in the last five years added one million people and is expected to grow by an additional three million over the next 20 years.
Newton County saw approximately $120 million in funding for county road improvement projects either cut or delayed because of the shortfall. However, because of a Board of Commissioners' decision to shift $19 million in GDOT funding from several other road projects to the Salem Road widening project, the purchase of right of way is expected to go on as regularly scheduled, but an additional $10 million is still needed to fund the remaining purchase of Salem Road ROW.
But what about the remaining projects which are still left unfunded or delayed? All of these projects are vital to continued healthy growth for the county?
According to a recent Atlanta Journal-Constitution article on, the biggest percentage increase in tax collections, which resulted in the surplus, came about as a result of increased gasoline taxes. When the Department of Revenue increased the gas tax, as required by Georgia law when gas prices increased, fuel tax collections increased 20 percent or $160.5 million during FY 2007.
It would stand to reason then that the best way to return tax revenue to the taxpayers would be through allocating some of the $600 million to GDOT. Those that spent the most money at the gas pump this past year and paid the most in gas taxes are also the ones that drive up and down Georgia roads repeatedly, contributing to a general wearing out of the roads and contributing to traffic congestion.
I say reward those who spent money at the pump by investing in the state's transportation infrastructure. In the long run it is the most efficient use of Georgia taxpayer's money and it will prevent embarrassing foul-ups for the legislature. It is possible that they could to issue a tax rebate one month only to have to undo it by raising taxes the next month when GDOT scrapes dry at the barrel and healthy growth and development in Georgia comes to a screeching halt on account of an insufficient transportation structure.
According to Sen. John Douglas (R-Covington) approximately $150 million from the surplus looks like it will go to Georgia PeachCare to stave off the funding crisis. The AJC reported that the state is going set aside $188 million to pay for expected increases in school enrollment.
As for the remainder of the surplus, Douglas said he supports putting it towards transportation uses.
"Transportation is still a very key issue in Georgia," Douglas said. "If we do have some extra money that we didn't plan on, then transportation is where it needs to go. We're having to scrape our nickels and dimes to pay for Salem Road improvements."
Alan Essig, executive director of the Georgia Budget and Policy Institution, wrote in a brief on the matter that he is in support of leaving any remaining surplus in the Revenue Shortfall Reserve, the state's savings account, which is used "to cushion the blow from economic recessions."
While it is sound policy to have a healthy reserve fund - which according to Essig the state is still $600 million short of having - if the reserve only exists to cushion the state in the event of an economic downturn, well then why not take actions to prevent a possible downturn by giving a boost to GDOT.
Without additional funding to GDOT, Georgia will face a recession when jobs stop coming to Georgia and begin leaving on account of a deficient transportation structure.
So to our state legislatures, I ask that you don't pander to us, thinking only of your next re-election campaign and your desire to say that you cut our taxes. Think of what's best for us in the long run. When Georgians are sitting in traffic for hours each day during their commute to work, do you think they'll be thinking about how happy they are that they got a tax rebate in the mail. No, they will be thinking of how tired they are of all of this traffic and how they can't wait to move somewhere less congested.