Flawed SPLOST plan should be nixed; bring back a better proposal next year

Local governments have been pushing hard for renewal of this tax, which over the next six years would rake in millions of dollars — over $45 million.

But the question is this: Should taxpayers approve this particular SPLOST tax?

The issue goes further than just whether or not the list of projects to be funded with the tax is worthy. The real issue is accountability.

As has been widely reported in these pages, several local governments have abused SPLOST taxes in recent years, spending money for things voters never intended, or spending money in ways that didn’t follow the law. One public official was even caught on tape bragging about how his town was in violation of the law with SPLOST tax dollars.

The problem is, there are no teeth in Georgia’s SPLOST law. If a local government abuses those tax dollars, there’s little legal recourse for taxpayers other than suing the county, an expensive proposition that could take longer than the SPLOST would even exist. The state won’t step in.

But there is another recourse — for taxpayers to not support this SPLOST. Cutting off the money is the only real method taxpayers have to punish bad behavior by local officials who have abused the SPLOST system.

Some supporters of the proposed SPLOST tax acknowledge that there has been abuse in the system, notably with Pendergrass, Jefferson and Hoschton. There are unverified reports of abuse in other areas as well.

But supporters argue that the dollar amounts of abuse are small compared to the total and that it’s better overall to approve SPLOST for the greater good and ignore the abuses. Really?

In addition to the abuses, there are a number of other problematic issues related to this proposed SPLOST:

• Although some of the proposed SPLOST goes to retire county debt service, especially to pay toward the new county jail, all of the SPLOST taxes could have gone to pay down county debt. Why didn’t that happen? Because rather than declaring the jail a Level 1 project and using 100 percent of the SPLOST to pay off that and other county debt, officials played politics by spreading the money around to the towns, even though the towns have been the worst abusers of SPLOST taxes. County officials didn’t want the various mayors upset as re-election in 2012 looms, so they gave the towns appeasement money. Politics, not real need, determined how the taxes from this would be used.
• While some of the proposed SPLOST money goes toward debt service, the taxpayers in Jackson County never had a chance to agree to take on that debt in the first place. County officials have long avoided asking taxpayers to assume debt with a series of clever, non-referendum financial moves. At the end of 2009, Jackson County had $130 million in outstanding debt, nearly $2,100 per person for everyone in Jackson. From the courthouse to road bonds to the new jail, voters were never asked if they would agree to take on that massive amount of debt. As a result, the county is now asking taxpayers to pay for debt after the fact via SPLOST taxes. That’s backwards.

• Not a single county leader has publicly been critical of how some local governments have abused SPLOST tax dollars; not a single mayor has been critical of SPLOST abuse. Nobody in public office wants to hold his fellow public officials accountable because it would break the code of silence. That’s not leadership, that’s acquiescence — “good ol’ boys” scratching each other’s backs to keep the tax dollars flowing. If public officials won’t hold each other accountable, then voters should cut off the flow of tax funds and hold everyone accountable.

• In asking taxpayers to approve this SPLOST, one of the key arguments made by county officials is that if the SPLOST isn’t approved, they will have to raise property taxes. But that’s like putting a gun to the heads of voters and saying, “Vote my way, or else.” Taxpayers shouldn’t be bullied or threatened by their elected leaders that way. The BOC and city governments wouldn’t have to raise taxes anyway; they could cut more spending from their bureaucracy.

• SPLOST money isn’t just limited to capital project expenses. Spending money on capital projects also increases regular government expenses. As a 2002 study by the Carl Vinson Institute of Government shows: “SPLOST does not reduce property tax burdens.” The reason for that is that the cost of overhead and maintenance for capital projects increases local government spending. According to that study: “An extra dollar of SPLOST revenue results in a 50-cent increase in total spending; 38 cents in capital spending and 12 cents in current operating spending.” In other words, the more you spend on new SPLOST projects the more you have to spend from other taxes to maintain those projects and pay the overhead. But if the county had dedicated 100 percent of SPLOST to retire debt, there would not be any additional overhead cost. That would have been the most efficient use of county SPLOST taxes.

• In 2012, the state is going to be pushing a new sales tax for regional transportation. That’s on top of all the current sales taxes, a sign that both state and local governments want to tap into sales taxes even more in the future. At this rate, sales taxes will be into double digits within a few years. Where will taxpayers draw the line?

• According to state law, cities and counties that collect SPLOST taxes are supposed to report at the end of each year how they spent those funds. But several local governments have always knowingly ignored that law (funny how public officials pick and choose the laws they want to follow.)

• There are some questions about the current SPLOST proposal and if it follows the law. For example, the last SPLOST vote in 2005 approved using money to build four new EMS stations. One got built, the other three are now back on the ballot. It’s not clear why those projects were not funded with the 2005 taxes, or if it’s legal to put the same projects on a SPLOST ballot a second time.

What’s really a shame is that county leaders had sufficient time to think about these issues and plan accordingly. They could have done this SPLOST differently by using 100 percent of the $45 million for retiring county debt (which would have helped every citizen in the county no matter where they live.) As for the towns, until they put some kind of accountability in place they don’t deserve another cut of the SPLOST pie.

This newspaper has traditionally supported SPLOST plans in Jackson County over the last 25 years. A lot of good things have happened in Jackson County by the prudent use of those dollars, although at times it has been used to fund pet pork projects. But in general, we support SPLOST as one financial tool for local governments to use.

But we can’t support this SPLOST as it has been presented to voters. It doesn’t do enough to reduce the county’s massive $130 million debt and it does nothing of substance to hold local governments accountable for having abused those funds in the past, or to prevent additional abuse in the future. While the county is proposing to have “oversight” committees, those groups have no teeth and no leverage to ensure the money is spent for what voters approve.

A lot of local citizens have said they identify with the goals of the national Tea Party movement — that is to cut government spending, reduce debt and hold elected leaders accountable for our tax dollars.

On Nov. 2, local voters will have that opportunity. This flawed SPLOST proposal should be rejected, a move that will force county leaders to go back to the drawing board and bring back a more fiscally responsible plan next year.

Mike Buffington is editor of The Jackson Herald. He can be reached at mike@mainstreetnews.com.