The 2012 R.A.T.S. Vote for Metro-Atlanta Region (aka “RATS”)
by Bill Simon
For the 2012 RATS vote, the misinformation war has begun…and, to no surprise to anyone, the misinformation comes from the “pro” side.
What is “RATS?” RATS stands for Regional Atlanta Transportation SPLOST. It’s that 1% sales tax addition to 10 metro-Atlanta counties’ existing total sales tax. (If this “RATS” concept sounds familiar, a few months ago I dubbed this T-SPLOST as “RATS”…easier to remember, and more accurate as to the political storm of misinformation that will ensue from the pro-RATS side.)
The vote is going to be on the ballot sometime in 2012, and, according to one blog I read, “July or August of 2012.” The actual date has not been set yet by the Secretary of State. The commonsense ballot date should be during the 2012 General Primary, which is usually held in July of a normal Georgia election year.
It would be “commonsense” because then the 10 counties’ election boards would not have to set-up for a special election, potentially costing anywhere between $340,000 (as Cobb County’s recent March SPLOST cost) and $455,000 per county in extra taxpayer dollars to finance any such vote in each county.
Note: The “$455,000” is an extrapolation of what a special election date would cost in Fulton County based on Cobb’s dollar amount for their SPLOST. Cobb County’s 2010 Census population was estimated at 688,078. Dividing this into Cobb’s published dollar figure of $340,000 for their recent SPLOST, you come up with an average cost per person of $0.494. Fulton County’s 2010 population estimate is 920,581, so this means a potential cost of $455,000 to Fulton County residents.
To the “misinformation war”, I direct your attention to an article published in today’s AJC on this ballot election, titled “Too Big to Fail” article.
In this article, about halfway down the page, state economist Kenneth Heaghney quotes a dollar figure that this additional 1% sales tax would only add to the “typical family’s budget” a total of $216 per year.
I’m not sure what the phase “typical family’s budget” means. And, it is crucial that that definition is defined because to not do so would be to deliberately mislead the voters.
Let’s look at the Cobb County SPLOST passed this past March 15. Over the next 4 years, the county is hoping for $492,000,000 in sales taxes to be collected. Taking the population of Cobb used above of 688,078, this means an average of $715 per person over 4 years. Dividing again by 4 leads us to an average of $178.76 per Cobb resident per year.
And, a “resident” is defined to just be a person, regardless of the age of that person…regardless of whether that person is an adult or a child. All we are talking about here is a “tax burden per living person.” $178.76 per Cobb resident per year.
If the minimum “family” consists of 2 adults and one child, then this 1% Cobb SPLOST will actually burden this “minimum” family unit by $536.28 per year for the next 4 years. So, while my own personal “family unit” consists of one person, most of the family units in Cobb have more than one child present, so this $536.28 is (barring someone’s more exact, precise data) is a pretty good estimate of the total burden of Cobb’s SPLOST per typical family, right?
For the record, I do not believe the other 9 counties have that much lower of a cost of living than Cobb County. Maybe in property taxes, they do. But, not in sales taxes. And, it is sales taxes that take the bigger bite out of a family’s operating budget than property taxes. A Publix or a Kroger in Cobb County charges the same for 6-pack of Coca-Cola as a Publix or Kroger in Fayette County does. Purchasers in either county will pay that same amount and that same additional 1% in sales taxes.
Looking at the 2012 regional SPLOST vote, and the same logic should be applied:
Fact 1: Population of 10-county Atlanta region = 4,124,300
Fact 2: The RATS SPLOST project is expected to generate $8-$10 billion for the 10-county region over the next 10 years
Fact 2 divided by Fact 1, and that number divided by 10 (for the 10 years of the SPLOST) produces an expected total additional tax burden of between $193.97 and $242.47 per person, per year
And, taking into account that the “typical family” is comprised (at minimum) of 2 adults and one child, this means the total additional burden if this RATS tax passes is actually between $582 and $727 per “typical family” per year for the next 10 years in this 10-county region, NOT the “$216 per year” offered by state economist Kenneth Heaghney.
The “$216 per typical family per year” is, on its face, a number that should be strongly contested. If nothing else, the recent failure of the tax law change in the 2011 Legislature due to “different numbers” coming out of Georgia State University’s department hired to do the modeling analysis should prove that economists and calculations coming from ANY source need to be questioned and challenged as to their accuracy. Especially when it comes to tax policy being exerted onto a tax-and-spend weary population.
P.S. And, hey, I’ll invite Mr. Heaghney to challenge these numbers…as well as Mr. Kelly McCutchen of the GPPF (I’m just guessing Kelly is going to be pro-RATS just…because…Kelly always appears to go for the “more tax route” vs. “more efficient use of taxes and/or less spending of tax dollars” route.)
May 22nd, 2011 at 1:51 pm
Bill I don’t know how you could think it matters that much what it would cost Cobb or Gwinnett taxpayers when you know Fulton and DeKalb have been paying this $600 or so per family for over 40 years and have benefited the others greatly over that time. We’re just not going to continue to be screwed by paying it twice if you agree to pay it once.
May 22nd, 2011 at 2:11 pm
Gene, this RATS vote is NOT for MARTA to come into Cobb & Gwinnett.
AND…you folks in Fulton and DeKalb would be getting an additional $500-$700 some odd amount added to your family’s budget. I wouldn’t be so gleeful if I were you. 🙂
May 22nd, 2011 at 5:46 pm
Unmentioned in the early hoopla is the TSPLOST will take Atlanta and seven other counties and Municipallities to 9% sales tax (among the highest in the country and the highest when combined with state income tax. . . .)
May 22nd, 2011 at 5:55 pm
Hi, Bruce
You are correct about the City of Atlanta limits going to a 9% sales tax. I’m not sure about the “seven other counties” as, as far as I am aware of, there is no county right now that is above 7%.
Now, if there are new county-SPLOSTS in the works for these seven, then that is something I was not aware of.
May 23rd, 2011 at 10:00 am
Hi Bill. Did you factor in taxes paid by people who don’t live in the 10-county area? I know hotels, restaurants and motels charge sales tax. Six Flags and Whitewater too.
May 23rd, 2011 at 10:19 am
Hi, Curt
As far as I’m concerned, Curt, the money collected from those sources might add something, but the burden still remains totally on the 4 million some-odd residents of these 10 ARC counties. If the conventions don’t come, if the tourists don’t come, the burden still remains on the residents.
The bulk of the people visiting Whitewater, Six Flags, etc. likely live in the 10-county, Atlanta Regional Commission region. So, that is their burden.
And, keep this in mind: If the government collects more money (via the hotel. motel), you think they are going to return it to the taxpayers? Or, stop sunset the SPLOST tax? Show me where that has ever happened in this state.
Finally…a collection of $8 billion over 10 years assumes a robust economy to produce that revenue. $8 billion over 10 years implies $800,000,000 in sales taxes per year. At a 1% sales tax rate, that implies there will be $80 billion in sales tax-specific economic activity per year in a 10-county region. That’s a lot of economic activity people are anticipating to happen.
May 23rd, 2011 at 10:55 am
Bill, first I’ll complement you for taking on this issue. Love the name RATS.
1). Current regular sales tax is NOT paid on many items such as pharmaceuticals and groceries. SPLOST and RATS tax IS PAID on EVERYTHING.
2) The arguement that people from outside the region help pay the taxes is worn out. Cobb used that on the recent SPLOST. They were called on their “proof” documentation which didn’t even mention the subject, substituted a new doc (still on the SPLOST web site) which also DID NOT prove it. I examined economic data and concluded that taxes from non-residents are miniscule in this calculation.
May 23rd, 2011 at 11:03 am
Other thoughts:
1) I have put together a PowerPoint presentation on this. I spent significant time studying the new law. There are all kinds of political IEDs hidden in this law. I’d be happy to go over it with you.
2) As for MARTA: The law provides for Cobb, Gwinnett and Clayton to vote on joining MARTA. If approved by voters we would negotiate how to combine CCT & MARTA.
3) If that fails, there is already a committee at work finding a way to combine all the transit systems in the region anyway. (We don’t need no stinkin’ vote).
4) More MARTA: In a positive step, the law dismissed all members of the MARTA Board last December. A new Board is in place. It appears to be composed of lawyers, etc. The new Chairman of the MARTA Board was previously Chair of the Lenox area CID. He rides a bike to work.
May 23rd, 2011 at 1:13 pm
Even now, the upcoming T-SPLOST/RATS is effectively being mandated by the state, region and participating counties. If passed, no county in the (BIG-10) will ever get their fair or honest share from the total taxes collected for their specific projects. Does anyone really believe that will happen with so many hands in the regional (BIG-10) pot of money?
Get real…
May 23rd, 2011 at 1:25 pm
Larry,
At this moment in time, I do not have the free time to delve into the issue much more than what I’ve done. But, I’m pretty sure your info could be useful if published on a Website…of which I am aware of someone being in the beginning stages of developing to help communicate the message.
May 23rd, 2011 at 9:24 pm
Joe,
You have a very good point…and, the reality is that NO county knows exactly how much of a “fair share” they are getting now.
I’ve seen some data that suggests that there is a significant amount of money lost by a county where a ZIP code is shared between two or more adjacent counties.
Take ZIP Code 30339, for instance. Some of it is in Cobb County Unincorporated and some of it is in City of Atlanta. I have seen sales tax receipts where the delivery was made to a Cobb County unincorporated address, but the sales tax charged was the 8% for City of Atlanta…thus both the Cobb County government and the Cobb County school system were cheated out of their respective 1% SPLOST collection.
May 24th, 2011 at 7:39 am
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June 1st, 2011 at 1:10 pm
Our entire perspective on this issue is skewed by the unexamined subsidies that roads and cars receive. First, depending on whose numbers you believe, we subsidize oil to the tune of $30 billion to $70 billion a year. Then we build “free” roads from general tax dollars, because motor fuel taxes are far too low to cover the actual cost of building and maintaining roads. If we eliminated Big Oil subsidies and raised motor fuel taxes to cover the actual cost of roads, then we’d have a clearer idea of what public transit is worth and what’s the best way to pay for it.