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VOL. 132 | NO. 79 | Thursday, April 20, 2017

Memphis, Nashville Mayors Praise Passage of Haslam’s Road Funding Bill

By Sam Stockard

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Memphis Mayor Jim Strickland lauded the Tennessee Legislature for passing the IMPROVE Act, including a combination of fuel tax and fee increases designed to improve transportation funding.

“The General Assembly did the right thing (Wednesday) by voting for Gov. Haslam’s IMPROVE Act, which I was proud to support,” Strickland said via Twitter. “This will help Memphis and the entire state of Tennessee when it comes to maintaining and improving our roads and bridges, and it also gives us more options as we explore sustainable funding solutions for mass transit in our city.”

The road funding bill approved by the Tennessee Legislature calls for increases in the gas and diesel taxes and vehicle-related fees, all offset by reductions in business, Hall and food taxes.

(Daily News File/Lance Murphey)

Shelby County has some 20 road and bridge projects worth $600 million included in the legislation, part of $10.5 billion in transportation work languishing statewide.

Nashville Mayor Megan Barry also hailed the Senate and House votes in favor of the bill.

“This is a momentous day in Tennessee, as the General Assembly has voted to move our state forward on building the transportation infrastructure we need to remain competitive economically and improve the quality of life of our residents,” Barry said in a statement. “I want to thank the entire Davidson County delegation for voting in support of Gov. Bill Haslam’s IMPROVE Act, which contained the critical local option component that will let voters determine the future of transit in the Nashville area.”

Gov. Bill Haslam agreed some work remains to pass the legislation.

“The IMPROVE Act is the largest tax cut in Tennessee history, makes us more competitive as we’re recruiting manufacturing jobs and keeps our transportation network safe, reliable and debt-free for the next generation of Tennesseans,” he said in an email statement.

The House and Senate still have to concur on part of the bill dealing with property tax relief at the county level for veterans, the disabled and elderly. It will take about $7 million in the governor’s $37 billion spending plan to push the tax-break maximum to $175,000 for veterans and to $27,000 for the elderly and disabled.

Gov. Bill Haslam’s IMPROVE Act, also dubbed the 2017 Tax Cut Act, carried by Rep. Barry Doss through the House and Senate Majority Leader Mark Norris, calls for a three-year phase-in of 6 cents more on the gas tax, pushing it to 27.4 cents per gallon, and 10 cents more on the diesel tax, raising it to 28.4 cents per gallon. In addition, it would place a $100 fee on electric cars, add $5 to the state’s vehicle registration fee and give local governments the option to raise a set of six taxes to pay for mass transit projects through voter referendum.

To offset those fuel and vehicle fee increases, it would combine reductions in business, Hall and food taxes as well as veterans’ property taxes to total more than $400 million compared with a $350 million increase in fuel taxes and vehicle fees, officials say.

Opponents said working-class Tennesseans would bear the brunt of the tax burden, and several lawmakers said those who vote for it could pay at the ballot box.

Americans for Prosperity, a conservative group fighting the governor’s gas-tax plans for more than two years, thanked Tennesseans who made phone calls and emails in opposition to the act along with lawmakers who “stood firm” for road funding proposals without tax increases.

“Despite this and our best efforts, the voices of hardworking Tennesseans and struggling families were silenced by political promises and wasteful pork projects,” AFP state director Andy Ogles said in a statement. “Tennessee was a $2 billion surplus, and as the voice and chief advocate for Tennessee taxpayers, AFP will continue the fight for future tax cuts, greater transparency and issue accountability. The fight isn’t over, this is merely the beginning.”

Asked if Tennessee’s poorest residents will feel the greatest effect of the tax increase, Norris said nothing could be “further from the truth.” He pointed out all Tennesseans have to buy groceries and eat, whether they’re on government assistance or not, but not all residents drive.

“It’s sort of the action of the generation in the sense that we haven’t tackled this problem since the late ’80s, and I’m very proud of the Senate, I’m proud of the House. I think everybody discharged their responsibilities admirably with very few exceptions,” said Norris, who rewrote the bill a month ago to phase in fuel tax increases over three years and lower the food tax to 4 percent from 5 percent, a 20 percent decrease.

State Rep. John DeBerry, who saw the fight over an income tax firsthand some 17 years ago, was among the Shelby County legislative delegation who voted for the IMPROVE Act.

“The fact of the matter is at some point in time we’ve got to fund our government, and we may have a surplus and we may be doing pretty good right now, but this is a tax, if you want to call it that, that hasn’t been raised since the ’80s. So I figure this is the best way to do it,” DeBerry said.

The Memphis Democrat said he told the governor in January he would support the proposal and remained in his corner through a number of amendments.

DeBerry said another measure proposed by Rep. David Hawk, which would have taken a portion of the sales tax collected from vehicle sales in the general fund and steered it toward transportation, had some merit.

“But ultimately we have to make a decision on one course or the other, and I think the governor’s course was the best one,” DeBerry said.

House Democratic Caucus Leader Craig Fitzhugh considered Hawk’s proposal the wrong direction to take, especially since the state has always used the transportation fund and fuel tax to pay for road and bridge projects.

Even though Democrats said recently they were leery of the governor’s plan, in part because they felt it didn’t do enough for the working class, nearly every member of the House Democratic Caucus voted for it. Only Reps. G.A. Hardaway of Memphis and John Mark Windle of Livingston voted in opposition.

“When you weigh everything out, we just couldn’t sit back, so we decided to go all in, and I was very proud of my caucus for supporting it. I’ve never worked so hard for a Republican bill in my life. But I think it’s a good thing, I think it puts us going forward in Tennessee,” said Fitzhugh, of Ripley in rural West Tennessee.

Fitzhugh pointed out former Gov. Ned McWherter was famous for saying, “Roads plus education equals jobs.”

“So we got the roads part done. … Let’s work on education with some bills we’ve got left, and then let’s just look toward more jobs.”

Sam Stockard is a Nashville-based reporter covering the Legislature for the Memphis Daily News. He can be reached at sstockard44@gmail.com.

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