The SPLOST Debate –Tim Carroll

Received 27 October 2013. -jsq

I have had a number of folks contact me about the upcoming SPLOST VII referendum and inquiring about a MOST. Trying to talk about all of this in as few a words as I can is not easy. But to give you some perspective—the city’s general fund budget is $32M. $5.9M of the revenue for this fund comes from property taxes. Based on the city tax digest a mill is worth $1.5M. The experts say 50.2% of the sales tax is paid by out of towners. In the opinion of some folks, it is closer to 30%. Pick the experts or local guesses ….it still is a significant amount. It clearly is very beneficial to the citizens of Valdosta and Lowndes County.

By now many have heard about a MOST or Municipal Option Sales Tax.

In the first part of this year—the city of Valdosta was faced with having to relocate one of its’ waste water treatment plants plus construct a new force main. Funding for these type of projects has over the past 20 years been paid for by SPLOST. With no plans by the county to call for another SPLOST after last year’s defeat, your city leaders began discussing a MOST with our state legislators. The criteria was very limiting on how the funds could be used and what qualifications were required to be eligible. For the most part these qualifications were based on Valdosta’s 2009 flood event and the requirement for a consent order from EPD.

The bill was moving along within the state legislature when the county approached the city stating they had reconsidered and decided to go for another SPLOST referendum. Once this was announced, the city was no longer in need of a MOST as a SPLOST would not only provide the funds for the waste water treatment plant and force main, but also other important capital projects. So what does this mean? HB 403 remains in the House Ways & Means Committee and is eligible for consideration during the 2014 Legislative Session. It would have to be brought back before the W&M Com, if it passes it would then go to the Rules Committee in the House. If it passes Rules it then would go to the House floor for a vote. If it passes the House it then would go through the whole process again in the Senate and if it passes all that it would then go to Gov. Deal for his signature. We then could call for the local referendum and then if the voters pass it we will have a MOST. Just keep in mind…at this moment—there is no MOST to consider. It may never make it all the way to enactment.

I think it is also important to note in this discussion that there are some folks in our community that believe they know more about our infrastructure needs than the professional engineers, utility directors etc that work in these fields. As such do not believe the city (nor county for that matter) “need” funds for roads, streets, bridges, fire equipment, maintenance equi pment etc. Unfortunately none of those that are saying this have provided any factual proof nor expert reviews to substantiate these claims.

So let’s get down to the facts about a MOST versus a SPLOST:

  1. The MOST (if passed by the Georgia House, then Senate, then signed by the Governor which is not a certainty and then must be passed by referendum by the voters of Valdosta) will only pay for water and sewer projects including the WWTP and force main projects. It cannot be used for anything else. It will also create a wedge between the city and county. So while a MOST tax may sound great on the surface, there will be potential negative consequences.
  2. SPLOST (if passed by a majority of voters in all of Lowndes County) will not only pay for the WWTP and force main projects but also a host of other capital projects. Projects that are listed such as roads/streets/bridges. Replace aging fire and police vehicles and equipment, replace garbage trucks, etc. Pay down or off debts connected to qualified capital projects. And do this for not only the city of Valdosta, but Lowndes County and the c ities of Remerton, Dasher, Hahira and Lake Park. All your local governments and its’ citizens will benefit…not just the city of Valdosta.
  3. SPLOST has directly helped to keep property taxes for both the county and the cities lower. Why? Because prior to having a SPLOST most all the listed projects above were paid for out of property taxes in conjunction with state and federal grants. With state and federal grants virtually all gone now, the burden would fully be placed on property tax payers. Let’s be clear—our communities had funding needs 40 years ago as they do today. We just simply had other revenue sources we could count on and used. We have e xperienced a lot of growth over the past 40 years. The city of Valdosta alone has more than tripled in size of population. With this growth came more streets to keep up and patrol, more traffic, more sewer and water demands as well as more fire protection demands. More and more customers to serve. Combine all this with the increased costs of providing and maintaining the infrastructure to serve the citizens it all boils down to choices. As an example, 20 years ago the Mud Creek plant cost $6M to build/upgrade. In 2008 the upgrades to that plant cost nearly $40M. So the question remains—how do the citizens want the city to pay for needed projects today?
  4. If you believe the voters need to vote No to SPLOST and Yes to a MOST you need to be aware— This could be a big gamble. What if the state does not pass it? What if the voters said no to renewing the current sales tax and do not want a new MOST tax either? Remember that the city has a consent order from EPD to spend $55.4 million over the next 6 years on waste water projects and those funds must come from somewhere.

* Consequences—if SPLOST fails and a MOST passes we still will have to find funds to pay for maintenance of our roads, streets and bridges. We still will have to replace vehicles that no longer are reliable or too costly to maintain. Where would you propose we find those funds? A small number think we can cut our budget and find the funds. It is true, we could cut the budget and free up funds. But so we are clear—people/employees (fire, police, admin/customer service etc) are the major expense of our general fund budget. ALL of our fire and police payroll and operational costs fall under this budget. Just fire and police alone account for 60% of our general fund budget. In order to free up the kind of money that would be needed… ($55.4 million at a minimum) we have no choice but to cut people and a lot of them. Are you Mr. and Mrs. voter comfortable with eliminating jobs that result in less service to you? Cutting the budget enough to cover needed pr ojects will have a domino effect. As you cut one area it impacts others.

So here you are—you have a decision and choice to make on November 5th- one of the three scenarios above will be decided upon. Two of them you have 100% control over and one will depend on the state legislature. Think about that—you—the voter has 100% control over telling his or her local city and county officials how you want things paid for or not paid for. And rem ember—it is YOU that told them how to pay for capital projects in the past. So if you think they have been wasteful—well the projects have all been put before the voters and the spending is audited each and every year. I think the projects have been good and you have passed most of the referendums by a 70% and above vote. There are a host of projects completed that hav e benefited all of our citizens at all levels over the years.

In conclusion: nobody likes taxes and I am right there with you. But unders tanding the relationship between lower property taxes and water/sewer rates and SPLOST is to recognize they go hand in hand. The advantage you the citizens have is with SPLOST—you have input and ultimately control over the list of projects SPLOST funds will be used for. Don’t you wish you could do the same with your federal income taxes?


Councilman Tim Carroll
Valdosta City Council, District 5
City Of Valdosta
P.O. Box 1125
216 E. Central Ave.
Valdosta, GA 31603
Valdosta…A City Without Limits