Transit Funding a Step in the Right Direction

By Baruch Feigenbaum

In 2015, the Georgia General Assembly passed the Transportation Funding Act, dedicating substantial existing resources from the general fund to state roadway funding. Unfortunately, the 2015 plan funded neither transit nor local roadways.

In 2016, legislation introduced by Sen. Brandon Beach proposed increasing the sales tax in the city of Atlanta, DeKalb County and Fulton County by 0.50 cents to fund three rail expansions: Lindbergh Station to Emory, alongside S.R. 400 from North Springs Station to Windward Parkway and Indian Creek Station to Lithonia.

While the Metropolitan Atlanta Regional Transportation Authority (MARTA) favored the rail expansion, some communities were not on board. Much of the opposition centered on North Fulton, where area leaders believed that improving local east-west roads was a bigger priority. 

It’s also important to keep in mind that the Georgia Department of Transportation had already announced plans to spend $2.4 billion along the SR 400 corridor to construct express toll lanes from I-285 to McFarland Road. This would provide a semi-dedicated, high-capacity transit corridor for Bus Rapid Transit or express bus service. In contrast, there is no current high-capacity corridor along the proposed light rail extension to Emory University.

The legislation failed to gain traction but the House attached one provision to Senate Bill 369: allowing the city of Atlanta to levy a 0.50-cent sales tax for “rapid transit.” While the bill still has yet to be signed into law, its passage looks certain.

This Atlanta-focused transportation component has positives and negatives. On the positive side, it allows the city of Atlanta, if voters approve the referendum, to expand its transit network. Transit works more effectively in the city limits than anywhere else in the region. The city needs to expand its bus service both to better serve the rail network and to offer transit service to locations the rail network does not serve.

Another positive is the local control element. The initial proposal failed in large part because it included a heavy-rail extension in North Fulton County, despite the objections of local leaders and residents. Current legislation that allows Atlanta to expand its transit service while Fulton and DeKalb wait an extra year actually takes local sentiments into mind.

There is no guarantee, unfortunately, that the city of Atlanta will spend its transit resources wisely. In December 2015, the City Council held a hearing to examine the city’s Atlanta Streetcar plan. That hearing focused not on the technical aspects of streetcars but on the fact that some city council districts did not have planned streetcar lines.

Despite a technical proposal explaining why streetcars could not serve all areas of the city, the updated streetcar map shows service in almost every city council district. Evidence suggests the city’s leaders should be encouraged to use the additional transit funding to improve vital services, not score political points.

Another big negative is that this proposal is not a regional plan but a continuation of local governments and counties funding and operating their own transit systems. Metropolitan Atlanta has 29 counties, yet the largest transit entity (MARTA) serves only three of those counties. For many North Fulton residents, the biggest gripe is that Cherokee, Cobb, Forsyth and Gwinnett residents use MARTA without paying the penny sales tax that supports the system. To them, the decision to increase the sales tax for Fulton county residents would have exacerbated the funding inequities.

Additionally, this new proposal for “rapid transit” fails to include any funding option for local roadways. Roadway funding may not be a priority for the city of Atlanta’s planners, but it is in most counties.

For 2017, the Georgia General Assembly needs to find a way to create a regional transportation authority. The agency would likely include some combination of MARTA, GRTA and other county transit agencies. Union participation in MARTA is likely to remain a major sticking point. The solution is for transit agencies to retain their governance structure but create a unified route network, fare structure and funding mechanism. Dedicated general fund revenue would be the best choice and a most palatable option, but any permanent, dedicated funding stream from the regions with buy-in would be an improvement.

Below are excerpts from our 2013 transportation study outlining our position on transit and transit funding:

Establishing an Effective Transit Network

Just as metropolitan Atlanta lacks a grid of major arterial highways, so too it lacks a comprehensive grid network for transit users. The metropolitan area’s bus network is split between five different transit operators and displays little integration with MARTA rail service, inadequate route co-operation, differing fare structures, and patchy geographic coverage.

This plan recommends adding 120 new local bus routes in the 13-county Atlanta region. Second, this plan recommends adding at least 20 new bus rapid transit (BRT) and express bus lines and identifies the most promising corridors for such bus service.

Expanded express bus and BRT service would complement MARTA rail to create a far more effective transit grid network than currently exists.

This plan also proposes three operational reforms to improve transit service in metropolitan Atlanta. First, in an effort to reduce costs and improve service, transit agencies should consider introducing contracting and competitive bidding across all their transit operations. Second, agencies should implement distance-based and time-of-day pricing. If structured correctly, this would increase ridership and revenue while also supporting more demand-responsive service provision. To offset potentially higher fares on some routes at some times, transit agencies should also consider offering vouchers to some low-income riders.

Finally, Atlanta policymakers should consider establishing a mobility management center (modeled on Denver’s) to coordinate different agencies’ services and technologies and ensure that they function together as an effective network. 

How Will an Expanded Transit Network be Funded?

This plan recommends that metropolitan Atlanta’s counties maintain their transit funding at current levels, and that this be supplemented with annual match grants totaling $66.6 million from the state government, which will help them to fund the expansion of local bus, express bus and bus rapid transit networks. 

[The State’s] transit program should then be given an annual budget of $120 million – enough to cover new match funding for bus network expansion, and the establishment of the mobility management center. 

Lastly, this plan encourages local governments and/or transit agencies to consider using value capture – likely through tax increment financing – to generate additional funding for bus rapid transit lines. This should raise at least $500 million over 30 years. Value capture could also be used to support MARTA rail, in combination with the existing MARTA special sales tax and, where necessary, grant anticipation notes.

Baruch Feigenbaum is a Senior Fellow at the Georgia Public Policy Foundation and Transportation Analyst at the Reason Foundation. The Georgia Public Policy Foundation is an independent think tank that proposes market-oriented approaches to public policy to improve the lives of Georgians. Nothing written here is to be construed as necessarily reflecting the view of the Georgia Public Policy Foundation or as an attempt to aid or hinder the passage of any bill before the U.S. Congress or the Georgia Legislature.

© Georgia Public Policy Foundation (March 21, 2016). Permission to reprint in whole or in part is hereby granted, provided the author and his affiliations are cited.