Scoppe: SC House road plan starting out on the right track
THE ROAD PLAN that Speaker Jay Lucas’ ad hoc committee rolled out last month puts the House back in what used to be familiar territory: a pragmatic voice positioned between a rigid anti-tax governor and an anti-reform Senate.
It’s certainly not a perfect plan, and there’s no guarantee that it can even pass the House; we can’t even be sure it will be intact when it’s filed as a bill, expected Wednesday.
The biggest problem is what it doesn’t do: It doesn’t overhaul our loophole-riddled, special-interest-driven tax code. We need to do that before we raise or lower any more taxes, but it’s painfully clear that no one in the Legislature or the governor’s office or much anywhere else believes that; so this a wash when we compare competing proposals.
Once you take comprehensive tax reform off the table, what you’re left with is a plan that is an excellent place to start a discussion. It’s also a plan that could be improved significantly with a few simple (if not so simple to pass) tweaks.
Read the reports that the ad hoc committee used to formulate its plan
What it does right
Let’s start with the positives.
Gubernatorial appointment also puts one person in charge of the Transportation Department, so voters have someone to hold accountable when things go wrong. (When 170 legislators are in charge of something, no one is in charge.) The plan provides a check on this additional gubernatorial authority by requiring the Legislature to sign off on the roads budget, rather than taking the hands-off approach that it does now.
A better way to tax
The plan could be improved by making more significant changes to the poster child for tax reform — the $300 cap on the sales tax on automobiles.
Under current law, someone who buys a $6,000 car pays a tax that’s 5 percent of the sales price, while someone who buys a $56,000 car pays a tax that is just 0.54 percent of the purchase price. Under the House proposal, the person who buys the $6,000 car would still pay that 5 percent, which still would be $300. But someone who buys a $10,000 car also would pay 5 percent, or $500. And instead of paying a tax of just 0.54 percent, the person who bought the $56,000 car would pay a tax of 0.89 percent. (Buy a $20,000 car, and you’d pay 2.5 percent, up from the current 1.5 percent tax.)
There are two better ways to raise the extra $60 million a year that this change would generate: Eliminate the cap entirely and lower the tax rate on automobiles, so that everyone pays a sales tax of about 3 percent of the total purchase value; that is, make it an actual sales tax rather than a fee for purchasing a vehicle. Alternatively, exempt the sales tax on the first $1,000 of the purchase price, and tax the rest of it at the normal 5 percent — that is, create a tax floor instead of a tax cap.
Read the projections for car-tax alternatives, and other road-funding figures
The plan also could be improved by giving local governments the authority to raise the money themselves to maintain local roads, rather than giving them state money that they legitimately fear the Legislature would take back at the next economic burp.
This point needs elaboration. One of our big problems is that the Legislature has never gotten past its 19th century notion that it should control everything that happens in our state. It orders local governments to do things the state ought to be doing, while at the same time doing things that local governments ought to be doing, and it severely limits how and by how much the city and county councils can raise revenue, even though those council members are in some cases elected by more people than are legislators.
It’s true that having the option to raise the money locally would be of little use to rural counties that have practically no tax base. But it’s also true that people in Richland County shouldn’t have to pay to pave half-mile roads with two houses on them in Allendale County — or in Lexington County. Or vice versa. Those ought to be local responsibilities.
A better way to spend
The plan could be improved by closing the loophole that allows the Transportation Commission to ignore the ranking of road projects that is based on objective criteria and instead undertake projects that haven’t even been evaluated.
It could be improved by eliminating the Infrastructure Bank board rather than simply expanding its membership to dilute the outsized authority the House speaker and Senate president pro tempore have over it.
Finally, the House roads plan could be improved by adding a fix-it-first requirement, to make sure that we get our current roads and bridges up to safe-driving standards and add extra lanes before building whole new roads — such as the $105 million interchange for the unfunded and quite possibly unbuildable leg of Interstate 73 that the Transportation Commission tried to authorize a few years back.
One of the reasons we’re in this mess is that the Transportation Department has focused its limited resources on building new roads rather than taking care of the ones we have. Changing that focus won’t bring our road system up to safe-driving standard, but it will free up some money to start addressing the problem.
And it will reduce the rate at which we are digging our ever-deepening hole.
Ms. Scoppe can be reached at cscoppe@thestate.com or at (803) 771-8571. Follow her on Twitter @CindiScoppe.
This story was originally published February 10, 2015 at 9:00 PM with the headline "Scoppe: SC House road plan starting out on the right track."