The transportation bill received much attention this past legislative session, and rightfully so. It doesn’t take long for one to drive anywhere in Georgia before noticing that our roads, interstates, and bridges are in terrible disrepair.
House Bill 170 was heavily debated in order to find reasonable ways to fund much needed improvements. The bill becomes law on July 1, but in the next legislative session, changes can be made regarding the funding sources in order to pay for such an enormous and crucial undertaking. While the overall legislation is good, I believe some important changes must be made regarding funding so that other aspects of our state’s economy aren’t adversely affected.
One of the financial mechanisms recommended to pay for infrastructure improvements is to add a $5-per-room, per-night tax to hotel rooms. Not only have I written a letter to the governor requesting that any reservation made prior to July 1 be excused from this tax, but I also recommend that the tax be changed from a $5 flat fee to a percentage based on room cost. For example, a $5 tax on a $150 a night room in Atlanta may seem reasonable, but apply that to a $60-a-night motel room, and it can be quite a burden to the hotel guest planning a week’s stay, possibly to the point of cutting short one’s visit.
A study conducted by PRK Hospitality Research estimates that the new tax may decrease occupancy rates in Atlanta and Savannah from 68 percent to 65.2 percent. It’s important to also note that in Savannah, only about 40 percent of visitors’ dollars are spent on lodging. The other 60 percent is spent on enjoying all that our beautiful city has to offer. Therefore, if hotel occupancy decreases, then our restaurants, tours, shops and attractions also suffer.
In addition, Savannah has established a healthy convention business, and we must consider whether this tax would have a negative effect on this important aspect of our local economy. If a corporation books a block of rooms, will they consider going to another, less-expensive state if an infrastructure tax adds significantly to their cost? Responsible businesses always keep an eye on the bottom line, and I would argue that this could be a deciding factor when companies consider Georgia as a potential site for large events and meetings.
In a common-sense approach, the bill includes another means for funding that will not affect the pocketbooks of either Georgians or the state’s visitors. This is a $50-per-tractor-trailer, per-year fee. Because the majority of the damage to our roadways and bridges is due to the heavy trucks that move commerce in and out of Georgia, it makes sense that such a fee is included in the transportation bill.
I believe that the high volume of commerce that is moved from our port through the state and beyond is tremendous for the well-being of our economy. The large trucks that haul products represent a healthy economy, and we all want to see our state and nation prosper. However, I believe that we can agree on a higher, yet reasonable, fee that will not saddle the trucking industry. With the large number of trucks traveling our interstates each year, this is a practical approach that can be a significant funding source.
The suggestions I have outlined will be ones that I recommend in the next legislative session. As chairman of the Economic Development and Tourism Committee, I recognize the importance of finding a balance while funding much-needed infrastructure improvements.
I believe that we must improve our substandard infrastructure, and we can do this without hindering other areas of our economy or burdening individual residents and visitors of our great state. I look forward to working with my fellow legislators in finding balanced solutions.