It’s time to remedy SPLOST process abuse
by Ron Sifen
March 06, 2013 12:00 AM | 3334 views | 11 11 comments | 19 19 recommendations | email to a friend | print
Should Georgia allow fractional penny SPLOSTs? The short answer is YES. Currently, many jurisdictions are raising far more taxes than needed to meet their needs, and the projects lists are being loaded with extra unneeded, unwarranted projects that squander our tax dollars.

However, the real answer is that we need far more comprehensive reform of the SPLOST process than just the question of fractional pennies.

— Georgia supposedly assures that voters have the opportunity to approve or reject new taxes in an election. Scheduling SPLOST votes for special elections or obscure “off-elections” when there are few other items on the ballot, dramatically suppresses turnout, and assures that most voters will not vote on the proposed tax. Any tax votes should only be allowed during November general elections in even-numbered years.

— Georgia requires an 80-day waiting period between a tax vote and its implementation. This requirement enables local jurisdictions to argue that if they held the SPLOST vote in November, they could not implement tax collections on Jan. 1. In the 21st century, there is no need for an 80-day waiting period. If our legislators would shorten the waiting period to 45 days, this “issue” would be eliminated.

— SPLOSTs were created to give local jurisdictions a funding mechanism for occasional major projects that could be paid for by an extra penny tax for a few years, rather than issuing long-term bonds, and paying interest for 20 years.

A few years ago, when Cobb needed to build a new courthouse and a new jail, these were projects for which the SPLOST concept was intended. However, over the years, when old SPLOSTs were expiring, governments didn’t want to let go of the income stream. SPLOSTs morphed into a mechanism to provide more and more and more services and “luxurifications.”

In some cases, SPLOSTs began funding the start up of new services or expansion of services, which would necessitate future operating and maintenance costs. Do taxpayers really need SPLOSTs to expand government services in ways that necessitate future tax increases?

— SPLOST project lists used to be formed by identifying the projects that were needed, and then proposing a SPLOST tax that would raise enough money to pay for those projects. That was a “bottom up” process.

Today, SPLOSTs are constructed through a “top down” process. Governments ask how much money they can raise with a one cent tax for a certain number of years. Once they decide they can raise $600 million over five years, then they try to figure out all the different projects, services, and “luxurifications” that they can spend the money on.

Do we “need” additional services because we need them? Or is government deciding to expand services only to justify renewing its SPLOST income stream? Have SPLOSTs become nothing more than “slush funds”?

It is time for government to go back to a “bottom up” approach to SPLOSTs. And it is time for taxpayers to recognize that more and more and more services equals more and more and more taxes.

— We also need reform to stop governmental and quasi-governmental entities from using tax dollars to influence voters on the reasons to vote in favor of a proposed tax.

In 2012, the region’s CIDs and the Atlanta Regional Commission used tax dollars to fund communications to “educate” voters on the alleged benefits of the T-SPLOST. The “facts” were carefully selected and “massaged” to influence voters to vote for the T-SPLOST, without saying the words “Please vote for the T-SPLOST.”

As an example, they claimed that the purpose of the T-SPLOST was to reduce our traffic congestion. They were later forced to admit that this did not mean there would be less traffic or fewer cars on our roads, or that it would result in reduced commute times.

We don’t need our tax dollars spent to deceive voters into voting to increase taxes to fund boondoggles that benefit special interests, while giving taxpayers little benefit for their money. Our legislators should prohibit any government or quasi-governmental entity from using any tax dollars to communicate any information regarding the alleged benefits of any tax or other issues that are on a ballot during an election.

I support the fractional penny as part of a comprehensive reform of the SPLOST process. I do not support the fractional penny as a way to avoid dealing with even larger abuses of the SPLOST process.

Ron Sifen of Vinings is president of the Cobb County Civic Coalition. His views are his own, and do not necessarily reflect the views of the CCCC.
Comments-icon Post a Comment
March 09, 2013
30% for new gyms and auditoriums. Most of the gyms are second gyms, for schools that already have gyms. Auditoriums not based on need, but based on people complaining that some other school has an auditorium, so I want an auditorium at my school. $40 million to rebuild a school that is currently in very good shape. More millions to replace some schools, but they can't identify which schools are actually in need of replacement. This doesn't pass the smell test.
Tony Cain
March 08, 2013
As always, Ron has given us food for thought.

This article is a real "education" for us before a nearly $800 million tax vote.

Thanks, Ron.
Thomas J Palmer
March 08, 2013
@ Stop Misinforming: The most recent statistics (2011) for high school graduation in Georgia is 67%.

This great accomplishment ranks behind Mississippi and Alabama. Please address how ESPLOST has helped EDUCATE students. Please address how many years ESPLOST has been in place in Cobb County. Please explain how freshly painted walls and Astro Turf on athletic fields can improve the education of students in Cobb County. An educated work force is a basic attraction for companies considering Georgia as a potential location. ESPLOST revenue does not allow for paying teachers salaries. ESPLOST revenue will pay for more classrooms which cannot be staffed due to lack of funds. ESPLOST revenue cannot be used for MAINTENANCE. ESPLOST revenue cannot be used for TRANSPORTATION. Cobb School Board superintendent stated that the proposed CAREER CENTER will be located somewhere and the students will find a way to get there. EXCELLENT planning. ESPLOST hooray !! Just give us the money, we will find ways to spend it.
James Bell
March 08, 2013
Special Purpose Local Option Sales Tax (SPLOST has become an addiction. Sifen's claim of "top down" project lists is accurate. To claim other counties do this but not Cobb is inaccurate.

Spending millions to hire consultants to tell them where to spend tax dollars is wasteful. School board officials should know their system and their needs.

Prior to making a project list, officials know the approximate amount a 1% tax can raise and plug in the projects accordingly.

Revenue bonds also require a public vote but also a millage rate increase. Perhaps official would be more diligent in the project list since property taxes would increase.

The bottom line on this issues is voters will determine this tax. Or at least 5%-10% of registered voters will. Voter turn out is key to defeating the tax.

A non-vote is a vote in favor of the tax.


@ James Bell
March 08, 2013
Check your facts...

As reported in the MDJ, the Cobb District awarded a $75,000 contract to develop the SPLOST project notebook after most needs (i.e. $2 billion) were already identified by the school district.

Millions, as you suggest, were not spent.

The current project list represents less than 35% of identified needs.
Fri otarynj
March 16, 2013
Can you define for me how secondary / auxiliary gymnasiums and theaters are "needs"?
Special Purpose
March 06, 2013
SP is supposed to mean special purpose. SPLOST is supposed to be a short term tax to pay for specific projects.

If SPLOSTs are going to be a never ending "slush fund", maybe we should rename them the "NELOST".
March 06, 2013
Right on, Ron.
Stop Misinforming!
March 06, 2013
Why do the anti-SPLOSTers continue to propagate the myth that governments first determine how much money they can raise through a SPLOST and then try to come up with luxury projects to fit that dollar figure? That may be true elsewhere, but it isn't true in Cobb. Mr. Sifen provides absolutely zero evidence to support this claim, and yet it continues to be the first talking point on the anti-SPLOSTers' cheat sheet. And while Mr. Sifen never mentions the vote to renew the school district's SPLOST, it's no coincidence that this op-ed piece is running just two weeks before the referendum.

Get your facts straight, Mr. Sifen. First, it has been well-documented that the school district spent more than a year developing its project list, and even hired an outside firm to conduct an athletics facility assessment to determine equity across the district. Additionally, the district's Maintenance Department conducted a comprehensive survey of facility needs at every school, and presented that report to the school board. Not to mention that all 114 school principals met with their PTAs and school councils to determine the priority needs for their buildings. The initial project needs list totaled more than $2 billion! Once the district determined what a five-year SPLOST would generate in revenue (which happened after all of the needs assessments), they had to cut the needs list by 65 percent! This is all documented. It is factual. It's not just some statement that an anti-taxer makes in the newspaper without any supporting evidence.

Second, if you are going to make an argument about holding the referendum in November, you again need to get your facts straight. You obviously don't know the SPLOST law, because you misquote it. The law does not require an 80-day waiting period between the referendum and the implementation. Georgia SPLOST law states: “If the imposition of the tax is approved at the special election, the tax shall be imposed on the first day of the next succeeding calendar quarter which begins more than 80 days after the date of the election at which the tax was approved by the voters.” That means that if the referendum is held in November and voters approve the sales tax, the tax could not go into effect until April 1, 2014, which is the first day of the next succeeding calendar quarter more than 80 days after the election. The current sales tax expires on Dec. 31, 2013, so all retailers in Cobb County would have to stop collecting the tax on January 1, 2014 and then re-impose it on April 1, 2014. This would cause a disruption in collections and lost revenue as some percentage of retailers undoubtedly would fail to re-impose the tax in a timely manner.

Like the rest of the anti-SPLOSTers' talking points, Mr. Sifen's arguments are unsupported by reality and the facts. Does he really want to see SPLOST voted down and then see the school system impose a general obligation bond that requires a massive property tax increase? Get real. There are 114 school buildings and they all have needs that have to be paid for one way or another. That's another fact. You can either raise property taxes to do it, or you can impose a one-cent sales tax that costs the average citizen far, far less per year, and is supported substantially by people who do not even live in Cobb! How can anyone rationally oppose supporting schools with SPLOST? Unless, you are simply opposed to supporting schools? Isn't that what it really comes down to?
Devlin Adams
March 06, 2013
Now go colect your pay from the Chamber of Commerce for writing this piece of misinformation.
Ron Sifen
March 06, 2013
For the record, the timing of this column had nothing to do with the E-SPLOST. It had to do with a bill in the state legislature to allow fractional penny SPLOSTs.

Every point I made in this column addressed problems that need to be addressed by the state legislature to reform the SPLOST process. While I think the fractional penny is a good idea, I do not want to see it used as a distraction from the need for reform of other egregious abuses.
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