Legislature should make sense — and cents — of fractional SPLOSTS
March 01, 2014 10:00 PM | 2708 views | 1 1 comments | 37 37 recommendations | email to a friend | print
Rural Georgia flexed its muscles last week in the Gold Dome, and the big losers are likely to be the taxpayers in prosperous suburban counties like this one.

The state House voted 92-78 against a bill sponsored by state Rep. John Carson (R-northeast Cobb) that would have paved the way for “split-penny,” aka “fractional” SPLOSTs. That is, Special Purpose Local Option Sales Tax referendums that would allow jurisdictions to collect a sales tax of less than 1 cent per dollar spent. The proposal that was killed last week would have allowed jurisdiction to collect SPLOST revenues in increments as small as 1/20th of a penny.

At present, SPLOSTs are set at the full 1 percent rate, meaning that in many cases the SPLOSTs wind up taking in more tax money than is really needed. So, what typically happens is that the issuing body inflates its “SPLOST list” so that it includes sufficient projects to match the size of the expected revenue stream from the tax, whether those projects are truly needed or not.

If the Legislature had acted as it should have, the pressure would have been on the issuing jurisdictions (county commissions, city councils, school boards, etc.) to downsize their future SPLOST lists so they would include only the items that were badly needed and easy to justify to voters.

But as we said, a majority of the Legislature didn’t see it that way. Apparently, many rural counties and their small cities lacked confidence they could work together to put together a SPLOST, according to Cobb Commission Chairman Tim Lee. Many Democratic legislators voted against it as well.

Opposition to the bill was whipped up by the Georgia Municipal Association, the lobbying group for Georgia’s cities, which contended it would pit cities against counties by forcing them to negotiate how to share SPLOST proceeds. Are Georgia’s small-town elected officials afraid to talk to each other these days?

In addition, some of the small counties don’t generate enough in sales taxes to pay for a big project in one SPLOST cycle, thus undercutting the need for a fractional SPLOST, according to the GMA.

“A lot of small local governments fear their voters, and they’re fearful that if some counties have half-penny SPLOSTs that they’ll be pressured for them to have half-penny SPLOSTs,” Carson told the MDJ. “A number of small local governments think they’ve got a good thing and why would they want to change it?”

Lee complains, rightly, that the legislature’s failure to approve the SPLOST legislation runs counter to its oft-stated preference for “local control.”

“I’m dumbfounded as to why the legislators won’t give local control to the local governments who have a responsibility of managing the programs, dumbfounded,” Lee said. “I’m just saying, in my county, I’d like to have the option to approach funding needs differently and to not allow me to do that, I don’t know why. There’s no rational reason as to why you can’t support allowing local counties to work their own financial models.”

To their credit, all Cobb-based members of the county’s legislative delegation supported Carson’s measure. And there’s still a small ray of hope. Carson plans to ask the legislature for a revote Monday.

“I knew that the government lobbyists were working against me, and I was still hoping for passage the first time, but I’m keeping my chin up and moving forward, and we’re going to do what we can to seek a consensus where we can and see if we can do it again,” he said.

We hope that this time around that Carson finds more support. It’s a proposal that makes sense — and makes cents.

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March 02, 2014
you should mention that this would be a boon for businesses, who would all round prices up to the whole penny, even if the SPLOST rate was 1/20th of a penny, thereby increasing their profits at our expense.
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