Sunday, August 19, 2018

Bill Crawford: Legislature Likely to Avoid Smart Tax Policy to Fix Roads and Bridges

Will our reluctant legislators finally get off their duffs and do something to fix roads and bridges across Mississippi?

Gov. Phil Bryant called Friday for a special session on August 23rd to deal with the. House Speaker Philip Gunn and Lt. Gov. Tate Reeves still have not found common ground on the issue, formerly a prerequisite Bryant had for the session. Heaven forbid that all those other legislators would do something without Gunn's and Reeves' permission.

A recent report from the conservative Tax Foundation stated, "Currently, 28% of Mississippi roads are in poor condition, and 12% of bridges are deemed as structurally deficient. An estimated $400 million a year in additional revenue is needed to compensate for these inadequacies." Bryant closed 83 unsafe bridges in April.

The Tax Foundation says "smart tax policy" includes having the "lion's share of transportation funding" come from user fees and user taxes. Mississippi fuel taxes and user fees covered 36% of local and state spending on roads and bridges in 2014, putting the state in the bottom quartile nationally.
Gunn seems to agree with the foundation and has recommended options to increase fuel taxes. His latest offer was to swap an increase in fuel taxes for a decrease in income taxes.

Reeves, along with Bryant, wants no fuel tax increases.

"While raising a gas tax is often unpopular, aligning user fees, like a gas tax, with the associated spending projects, like road construction, is a sound financing approach for states," says the Tax Foundation.

This has been the conservative approach to financing necessary government services for years.

So what course, if any, will our legislators' choose?

Gunn's proposal is a watered down version of a tax swap proposed earlier by Rep. Charles Busby of Pascagoula. Busby proposed eliminating the 4% tax bracket on personal and corporate income and phasing-in higher fuel taxes – three cents a gallon per year for four years on gas and five years on diesel. Gunn proposed two cents a gallon for four years for both. Both proposals would index fuel taxes to inflation.

The Tax Foundation thought well of Busby's plan, which aligns with its "smart" tax policies, saying, "The swap would allow Mississippi to transition from taxes on income to taxes on consumption and final users, reducing burdens on investment and aligning the government services taxpayers benefit from to the taxes used for their expenses."

The Speaker may have backed off Busby's plan because it would reduce income tax collections about $165 million while increasing fuel taxes about $302 million. Given that Mississippians pay all of the income taxes but a significant percentage of fuel taxes are paid by out-of-state travelers and truckers, these amounts look about right. Gunn's watered-down proposal makes the amounts about even.

News reports say the tax swap looks DOA. That leaves a new state lottery, Internet sales taxes, state bonds, and such as possible sources of revenue.

These options, according to the Tax Foundation's perspective, would not be smart. Of course, doing the smart thing is seldom our Legislature's way.

Meanwhile, as legislators have piddled and puckered on this issue, local governments have started raising property taxes to fix closed bridges.

Crawford is a syndicated columnist from Meridian.


Anonymous said...

I’m pretty sure that taxing the user like a gas tax, instead of taxing income, is just a somewhat theoretically defensible way to shift the tax burden down the income scale. But poor Mississippians keep electing these guys, so I guess that’s what we’ll get and what we deserve.

Anonymous said...

If the senate can magically come up with $2M to build a public-private road in Rankin County that serves only a handful of people then surely it can come up with adequate funds to fix roads and bridges across the entire state.

Anonymous said...

The Lt Govenor will not do anything unless americans for orosperty tell him to do it. He has been promised a very very large donation from the Koch brothers. He knows he is going to have to fight like hell to win the election for gov. Jim Hood is going to give Tate all He wants that is if Tate can even win a primary.

Unknown said...

The Tax Foundation is very Liberal to suggest a Tax and Spend policy. Out of State travelers and truckers would simply drive through Mississippi to avoid the excessive tax burden and Mississippi Citizens and businesses would pay the max burden resulting in a slower economy. Here is the solution to pay for our infrastructure issues.
1. Cut 10% of the State bureaucrats for each year until the desired amount of savings acquired.

2. 10% cut in salary for State bureaucrats until savings accumulate to the desired amount.

3. A Standard flat fee for engineers that contract the road construction; engineers are overpaid and underworked. It will also lower the construction cost

4. Government officials must cut out the bribe and payoff policy for winning the bids. Which every construction co. factors in the cost of the project and will result in lower construction cost.

If the legislature implements these four standards Mississippi would have some mighty fine roads and bridges and the economy would grow increasing revenue for everyone.

Anonymous said...

Cowards. That's all you need to know about our lame governor, lt. governor and every other republican legislature in Mississippi. They need hundreds of millions of dollars to fix our roads and bridges. It has to come from somewhere. Raise the damn gas tax and be done with.

Anonymous said...

What Crawford, and many others across the state, fail to acknowledge is the massive change in policy being hidden in the entire 'infrastructure funding' question. Crawford hints at it in his closing comment, though.

Local roads and bridges have never been funded by the state - rather, those city and county roads have been paid for and maintained by local taxes, including car tags.

What the county supervisors (with a lot of help from the willing media) have done is to use this 'crisis' to push for a majob shift in state policy - pushing the cost of maintenance of county roads to the state, leaving them with more money at home to play with for pet projects, ads in school programs, trips to the coast, local non-profit contributions - anything except what is their primary responsibility.

If not, how does Crawford end his promotion if the Tax Foundation as being the Holy Grail with his comment that local supervisors are beginning to have to raise taxes at home? Increasing the gas tax or leaving it the same should have no affect on that issue under longstanding infrastructure funding policy.

Anonymous said...

10:10 Property taxes are not user fees or taxes. Cities and counties are prohibited from assessing such taxes.

Anonymous said...

Shelby Stewart - thank you, sincerely, for the laugh. Those were words straight out of Tate Reeves or any other tea party hardliner’s mouth. Literally none of that would improve road funding in the least. The gas tax is 31 years old - do any of you think construction costs are the same as they were in 1987? It’s simple, really. But the governor and his lieutenant won’t do what’s necessary because (gasps!) they might have to explain to their voters why they did something unpopular that was ultimately needed. Why do something hard when you can just simply keep speaking out against “evil tax raises”?

Also, to the commenter at 10 - I believe a portion of the gas tax does go to local roads, though it is a small portion.

Anonymous said...

Counties could easily fix their own roads if they had the authority to levy a tax on the people that use the roads. But the only authority they have to raise the revenue is the property tax. Stupid setup from the git go.

The state created a dependency with the state-aid system and the LSBP program. People send their income faxes and sales taxes and gas taxes to the state, then cities and counties go begging for money for their road and bridge projects.....the money that their constituents sent to the state in the first place. It empowers the state officials, kind of makes them royalty. Then of course when state revenue got tight (by their own doing), they just quit funding the bridge program and cut the state-aid paving funds. You can see why every Mayor, Alderman and Supervisor in the state quietly loathes our state legislature and leadership. But they don't dare say it out loud.

Anonymous said...

No, they will not settle this. Failing to act is a religious calling for Reeves and he doesn't care about the consequences as long as Lakeland Drive is properly maintained and Rankin County continues to "prosper" relative to the surrounding area.

Anonymous said...

1009, don't believe I ever said property taxes were user fees. Of course they are not.

But county and city governments are largely funded via personal and real property taxes. (Cities with a diversion if sales taxes.) The user fees,are through the car tags, which are largely used for local roads and bridgez.

But, other than the state aid road funds (a small part of the funding from gas taxez) the maintenance of city and county roads,and bridges has not been paid for by state funding. (Exception being in the last few years a small $20- $50 million for bridges being included in the general bond bill - but not a part of the gas tax.)

MDOT has decried the need for $300 million a year for eternity to maintain STATE roads. But the cry from all the media - including shills like Crawford - use the closed COUNTY AND CITY bridges as a basis for increasing the gas tax.

If the state decides to change its historic course and assume financial responsiblity for local roads as well as state highways, then the $300 million tax increase sought by Dick Hall and others will have to double. Someone needs to address what roads will be rebuilt with any new funds - be they directed to cities or counties with a new responsibility being taken on by the state - or if the money is to all go to MDOT, what specific roads will it be used for.

Anonymous said...

Bonds? I wish someone would publish what our State debt is and how it has grown over the last 16 years because these clowns refuse to address our funding issues

Anonymous said...

Counties could easily fix their own roads if they had the authority to levy a tax on the people that use the roads.

If they had the authority what would be the mode? By way of example tell us how Hinds, a county with a large inventory of rural roads, would tax the users of those roads if they only had the authority to do so?

Anonymous said...

10:19, do you actually thing that the gasoline sales are the same as it was 31 years ago? Gas usage has gone up but the money from the tax on gas has gone elsewhere.

Anonymous said...

It seems like any time 99% of the citizens need something, we have to give even more to the 1%. In order for us to pass the hat and raise a dollar, we have to give them fifty cents.

Anonymous said...

11:40, let a portion of gas taxes stay local or give local voters a say in assessing a gas tax locally.

Son of the Dearly Departed said...

Go and take a look at what California and Oregon have done. In the past, they gave buyers huge tax incentives to purchase hybrid and electric vehicles. And the liberal greenies bought in to that plan. So many so, that now they can't find the revenue, due to the lack of sales on fuel to repair the roads and bridges. So how do they solve that problem? By a "user tax". That's right. Vehicles are now fitted with tracking devices that work with the odometer so they can track your every drive. If you drive 500 miles in a month, they will know about it and you will PAY accordingly. Do we really want THAT?!

As for State Aid and the LSBP program, I take pride in considering myself the Son of the "Godfather of the State Aid" in that my Dad, a Professional Consulting Civil Engineer, had the foresight as far back as the 1960's to design and develop the State Aid Bridge Standard Plans. He probably revised them twice into the 1980's, for a very meager one time fee. A "cookbook" if you will of bridge plans that could be used by the Counties wherever they needed to build or replace a bridge. He was credited with having more than 6,600 (Sixty-Six Hundred) bridges built across the State of Mississippi according to his Standard Plans. He was a very forward thinking man, and his take on funding road and bridge repair: Make the fuel tax a sales tax at the damn pump. You can drive down any street with gas stations and find one that is selling fuel a nickel or a dime less than the others. This isn't difficult to solve!

Anonymous said...

Surely it would not make sense to tax the heavy trucks (construction, logging, hauling, etc) that tears up the roads the most for the damage they do instead of Joe Citizen driving a lightweight car?

Anonymous said...

Perhaps MS could budget more for infrastructure items and less for social services, business kickbacks, beef plants, clean energy plants, etc????

Anonymous said...

This special session will probably destroy Bryant's legacy. Tater ain't on board and Gunn really doesn't want the stains of a lottery on his hands. This thing could last weeks and they could come out it with nothing to show for it.

Anonymous said...

There are counties who have invested in infrustructure and do not have any deficient bridges. Look them up on state aid website. While other counties who spend their money on other items that are not core functions are government, or even worse, what money they do get from the state divided by 5 and let sit in an account until enough money is amassed to build a project in of the 5 districts of the county. Or take turns building by district supervisor. One would think the money from the state would go to the biggest need of the county, not district by district to further political fiefdoms. This too can be looked at on state aid website by examining the fund balances. Let us also remember that county engineers get a nice 6 percent right off the stop on state aid money, so they are very interested in more money heading that route.

It’s aimple really, show me a county with a lot of closed and or very def isn’t Bridges and I’ll show you a county that is poorly managed.

Anonymous said...

BE like 45 other states....LOTTERY!!!!!!

Unknown said...

10:09 You are welcome for the laugh, but this is no laughing matter. I challenge you to explain your assertion that "Literally none of that would improve road funding in the least." The facts are, when you save money from the budget and you drive down the expenditures for each project then you can do more with less. I'm just awe struck how you can make such an assertion with absolutely zero facts.

Anonymous said...

The following figures are from my oil jobber:

Currently we pay per gallon the following taxes:

MS environmental tax of .004
Federal diesel tax of .244
MS SPECIAL fuel Highway tax of .180
Federal Oil Spill tax .00214

I can’t remeber when the oil spill tax was added. Someone would have to enlighten me on that one.

Anonymous said...

11:33 - nice try, but no cigar.

State bonded indebtedness has decreased by approximately 25% over last 15 years, down from over $4 billion to less than $3 billion. Frankly, total bonded indebtedness and its structure is one of the strong points of the state fiscal state.

Anonymous said...

Louisiana Lottery Has Third Best Year Ever Despite Revenue Decrease, Contributes Over $159 Million to State Treasury for 2017.

Do you think our State Treasury could use this??????


Anonymous said...

The Lottery's total fiscal-year state transfers were $159,191,670. Since the Lottery began operations in 1991, more than $9.5 billion in revenue has been generated, primarily from ticket sales. More than $3.4 billion has been transferred to the state treasury.

Just giving you the Facts.......

Anonymous said...

Shelby Stewart, we are all awe struck as to how you can make your assertions, particularly 3 & 4, with millions of facts - with the problem being that all millions of them exist only in your head. You can provide no facts to support your assertions other than your wicked beliefs.

Anonymous said...

There is enough money for roads and bridges if we cut out spending for social and give away programs.Government was set up to handle only a few things and transportation was one of the main ones.

Anonymous said...

I agree with 5:06. There is enough money. We have more vehicles on the road now than we had in 1987 hen the expansion program began. It took a while to complete but with the amount of taxes we have in place I see no reason why we can’t accomplish our repairs.

DBowles said...

It will be so refreshing to watch Jim Hood run on the need to increase taxes so that we can expand government and spend more.

Unknown said...

Anonymous 4:43 I can back up my wicked beliefs with wicked facts how bout you?
1. Port of Gulfport access highway project. Millions of dollars spent on engineer fees for the project and not even a shovel full of dirt has been moved.
2. Kemper power plant contractors fill the coffers of local legislators with so much money that the legislators would not file their campaign finance reports for years resulting in the Secretary of State having to cover for them.

That is just two examples of wicked facts to back up my wicked beliefs. come on anonymous prove your point.

Anonymous said...

All highway and road funding should come from a gasoline tax. Those who use it, pay for it. Really simple.

Anonymous said...

Yea maybe! 30 years later they could possibly follow the lead of Louisiana and allow for a lottery,
given that,I guess Missippi will legalize medical marijuana in 2050.

Anonymous said...

Word up from the book festival on Saturday - Reeves and Gunn still don't have a deal.

We are going to waste 2 days under the thunder dome this week!

Anonymous said...

Yep, Philly about to get burned by Tater, and Tater is overplaying this no tax increase stuff. Folks are tired of driving on substandard roads and when nothing happens he will get the blame.

Anonymous said...

Yeah, I'm sure the navel gazing at the "book festival" produced a great number of rumors.

Anonymous said...

Yeah, sure, lottery. The answer to all our problems.

Look at how casino gambling fixed our schools.

Look at how a convention center brought in millions.

Look at how Farish Street enriched Jackson with tourist dollars.

We could legalize prostitution, heroin, and moonshining as well. Think of the revenue!

I think we should get the money from the same fund MDOT is using to build a $2 million express lane from Potatoville to the Dogwood Chick-fil-a. There's obviously money to burn there.

Anonymous said...

The Northern District DOT has no shortage of cash. When a roof leak appeared in the district headquarters they tore it down and replaced it.

Anonymous said...

u right wing clowns, electing the same crooked right wing clowns and then complain,
he's a strong conservative
he's a christian
he's about law and order
he supports the president
on and on and people are nauseating and have stifled the progress
of this country for 50 years.

Anonymous said...

9:04 was only here during a commercial break on MSNBC.

Anonymous said...

@ August 19, 2018 at 4:43 PM

The Lottery's total fiscal-year state transfers were $159,191,670. Since the Lottery began operations in 1991, more than $9.5 billion in revenue has been generated, primarily from ticket sales. More than $3.4 billion has been transferred to the state treasury.

And imagine how much of that has come from Mississippi and Arkansas residents? That's why Arkansas threw in the towel and created their own as well, with a Republican led legislature at that.

@ August 20, 2018 at 8:41 AM

Yeah, sure, lottery. The answer to all our problems.................We could legalize prostitution, heroin, and moonshining as well. Think of the revenue!

Look, grow up! It's 2018, not 1952. Arkansas, Louisiana, and Tennessee all border Mississippi and our residents go across the state line to spend money to play the lottery in those states. That is one time money that we lose in the end. You want those dollars to stay in Mississippi and not leave Mississippi.

In regards legalizing prostitution, should have done it ages ago. You regulate it, tax it, safety improves for providers and customers. It removes the criminal element from controlling the market. Plenty of liquor stores selling moonshine already. Heroin, yuck! No one wants to legalize that garbage.

The lottery will bring nothing but sunshine and rainbows! said...

Same people (like 2:18)...

Before a state lottery: "We need a lottery to keep dollars in the state and fund our roads and bring in revenue!"

After a state lottery: "Another tax increase to pay for welfare? Why don't these people get a job instead of pissing away their government assistance on lottery tickets?"

Notice you didn't comment on how casinos have saved our schools. Gee, wonder why?

Anonymous said...

@ August 20, 2018 at 3:56 PM

2:18pm here

You said, "Before a state lottery: "Another tax increase to pay for welfare? Why don't these people get a job instead of pissing away their government assistance on lottery tickets?""

Hell, I don't have any issues with the welfare recipients in Mississippi. A majority of them are senior citizens that worked bulls*t jobs in some po'dunk hick town, that barely had a retirement plan in place for them, and they were poorly educated to begin with to understand how to get a retirement plan in place. They just understood going to work, live for the the weekend, get social security when they reached that age.

To add fuel to the fire, 90% of that money comes from the federal government AND Phil Bryant changed state policy for people to get those benefits. It's ten times harder for people to get TANF and SNAP benefits and they cannot stay on the programs long, so now the state runs a surplus in those funds and actually returns it to the federal government.

As far as the casinos, it was a good idea until other states started allowing casino's in their own backyards too. So it was a good idea until the state of Mississippi was no longer exclusive players to the gambling market like Nevada and New Jersey.

Look, you already have Mississippians "pissing" away their government assistance playing lottery in Louisiana, Tennessee, and Arkansas - so once again - how hard is it to understand that you'd rather them piss away the money in their own backyard instead of losing it to a neighboring state!?

Once Arkansas created a lottery, it should have been a no brainer for Mississippi to create one. Because they figured out their residents were crossing the state line to play lottery in Louisiana, Texas, Missouri, Tennessee, and Oklahoma! They were losing dollars to 5 states! FIVE!

At this point, you are really trying to stop the bleeding and trying to stay competitive with the competition. The competition is Louisiana, Arkansas, and Tennessee, who is and/or were in competition in acquiring those dollars from Mississippians.

bill said...

There are a limited number of things you can do to a road or bridge. You can build a new one, maintain the ones you have, fix them when they break, or replace them, which is sort of like building a new one. That's pretty much it. Now, look at the MDOT budget in the context of what can be done to a road or bridge and tell me if it makes sense. There may be - probably is - money in the budget already that could be used for road maintenance, but no one can find it since the budget is so convoluted. Redo the budget, specifically noting how much money is being spent on the things that can be done to a road or bridge, and then see how much is left. I can live without Dick Hall's photo on the JumboTron at the football games, along with about a thousand other MDOT expenditures that don't have a direct impact on our roads and bridges. Let's fix the budget first, and I bet we'll find a lot more money to fix our roads and bridges. If we don't, at least we'll have exhausted our current funding sources before we start tapping new ones.

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