A bill in the General Assembly that would advance Mecklenburg County’s multibillion-dollar transportation plan was approved by the state Senate on Wednesday.
It has one significant change from a bill already approved in the House: It doesn’t allow Charlotte and other municipalities to replace existing road money with new money from a proposed one-cent sales tax.
The bill would increase the sales tax in Mecklenburg County by one percentage point, to 8.25%. Forty percent of the money raised would go to roads and 60% would go to transit.
Last month, WFAE reported that Charlotte City Manager Marcus Jones said in a budget presentation that the new sales tax money for roads — more than $100 million a year — would relieve pressure on the city’s general fund budget.
Although Charlotte billed the transportation plan as a “roads first” plan, Jones said money the city spends today on roads and sidewalks could be diverted to other purposes, such as salaries for city employees. That money would then be backfilled with new money from the sales tax, he said.
“What’s important about the sales tax for transportation … is that (money) can go directly into our debt service bucket,” Jones said. “It gives us more capacity to take some of the property tax and put it back in the general fund budget, and that pays salaries for police officers, for firefighters.”
He added: “While it’s all about mobility, it provides some relief on the general fund and the property tax.”
The city later clarified that it had no intent to “zero-out” current spending on roads.
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But the Senate transportation bill puts a stop to that discussion. Some legislators had read about Jones’ comments and objected to the idea that road money would allow additional spending in other areas. WFAE and Transit Time published an article about Jones’ comments on May 15, under the headline “Transit plan’s ‘road money’ would free up cash for other city priorities.”
“A lot of people who worked on this process were just as appalled when they read that,” said Sen. David Craven(R-Randolph), according to the N.C. Tribune.
The new provision calls for Charlotte and the six Mecklenburg towns to maintain roads spending that’s at least equal to their average annual spending on roads for the last 10 years.
Some of the towns, too, had been considering using some of the money to increase spending on non-road uses. Cornelius’ town manager, for instance, said last year that freed-up money could be used for “parks, public safety, you name it.”
When the original half-cent sales tax for transit was approved by Mecklenburg voters in 1998, it required the city of Charlotte to continue spending a set amount of money on transit. The idea was to not replace the old transit spending with new transit spending.
The bill allows the city to discontinue making that “maintenance of effort” payment, which was about $28 million a year.
But the overall amount of spending on transit will increase dramatically. The bill would generate roughly $200 million for transit in the first year, in addition to the money already raised by the half-cent transit tax.
Mecklenburg Commissioners are likely to vote this fall to place the tax referendum on the ballot for November.
