By: Shaney B. Lokken

About a mile and a half into my run this weekend, I nearly twisted my ankle at the edge of a crater in the sidewalk that looked like one hard rain would take the collapsing cement and the precariously balanced power pole sliding down into the ravine below.  To avoid the crater altogether I would have had to jump into a lane of car traffic because the street barely had a shoulder, much less a bike lane. I spent the rest of my run fuming about the state of the sidewalks and our transportation infrastructure. Why, I grumbled, don’t we have better roads, streets, and sidewalks?!

The answer, of course, is that it takes money. And planning.  The good news is that there is help out there for counties – the single county TSPLOST.

The Georgia General Assembly first authorized the single county TSPLOST in 2015 after the regional TSPLOST failed to take off as quickly as legislators had hoped.  The TSPLOST allows a county to levy up to a 1% sales tax for transportation purposes, subject to approval by referendum vote.  According to the Association County Commissioners of Georgia (“ACCG”), approximately 24 counties are currently collecting single county TSPLOST revenues and 63 counties are part of a regional TSPLOST, as counties have become more aware of what an effective financing tool this can be for their communities.

GATING ISSUES

There are a couple of gating issues before a county can levy a TSPLOST.  First, the county must already have a regular special purpose local option sales tax (“SPLOST”) in place, which also requires prior approval by referendum vote. Second, the county cannot already be participating in a regional TSPLOST, or have a regional TSPLOST up for vote in the same election as the county TSPLOST.  And third, the TSPLOST must first be approved in a county wide election.

SCOPE

The TSPLOST can be used for any transportation purposes, including:

  • Roads, streets and bridges;

  • public transit;

  • rails;

  • airports;

  • buses;

  • seaports; and

  • all accompanying infrastructure and services necessary to provide access to these transportation facilities.

“Accompanying infrastructure and services” leaves room for debate about how broad the project scope can be. This seems to include streetlamps that accompany new streets, but transit operations may need more analysis.

When a county is considering capital outlay projects consisting of road, street, and bridge purposes, the TSPLOST statute further provides that the projects can include the acquisition of rights of way, construction, renovation and improvement, resurfacing, relocation of utilities, improvement of surface-water drainage, and patching and other repairs, in each case for roads, streets, bridges, sidewalks and bicycle paths.  Yes, more sidewalks and bicycle paths, please!

The TSPLOST can be put in place for up to 5 years, at a maximum rate of 1% if the county and the “qualified municipalities” (defined below) within the county reach an intergovernmental agreement on the projects and how to divvy up the proceeds. If the county and the qualified municipalities don’t enter into an intergovernmental agreement, then the maximum rate that can be levied is 0.75% and the collections will be split up among the entities based on how much each entity spent on transportation projects in the last 3 years. In short, money is left on the table if counties and qualified municipalities don’t reach an agreement.

MILESTONES

There are certain milestones leading up to the election that will drive a county’s timeline and the actions that need to be taken, very similar to the process the county has already gone through to implement the prerequisite SPLOST:

  • Negotiation with the qualified municipalities within the county, hopefully leading up to execution of an Intergovernmental Agreement (an “IGA”);

  • The county resolution requesting the call of election;

  • The election superintendent’s call of election, and publication of the notice of call of election; and

  • The election.

Negotiation

The TSPLOST statute encourages cooperation with the cities within the county by requiring that the county meet with the “qualified municipalities” within the county to discuss possible TSPLOST projects and how the revenues will be applied among the parties.

A “qualified municipality” is a municipality that provides at least 3 out of a list of 12 services:

1. Law enforcement;

2. Fire protection and fire safety;

3. Road and street construction or maintenance;

4. Solid waste management;

5. Water supply or distribution or both;

6. Waste-water treatment;

7. Storm-water collection or disposal;

8. Electric or gas utility services;

9. Enforcement of building, housing, plumbing, and electrical codes;

10. Planning and zoning;

11. Recreational facilities; and

12. Library

A formal meeting with the qualified municipalities must take place at least 30 days prior to the call for election, but practically, negotiating a final IGA and getting resolutions through the governing bodies of multiple qualified municipalities will typically take 2 months or more.

The IGA needs to identify both the purposes and the projects, but this list can and should be very broad. The parties also need to estimate the costs for the projects and how TSPLOST collections will be allocated among the county and the municipalities. Best to err on the pessimistic side about how expensive these projects will be, because by statute the TSPLOST must end upon the earlier of 5 years or the end of the quarter in which proceeds reach the estimated amount identified in the resolution and election ballot. Note that 30% of the proceeds need to be spent on projects consistent with the Statewide Strategic Transportation Plan.  Finally, a county needs to decide if it wants to authorize general obligation debt for the TSPLOST projects, because that can be included in the same ballot question, and in the IGA the county will want to identify how, if at all, the debt proceeds will be applied to the county vs. the municipality projects.

If the county can’t reach an agreement with the municipalities, the county can still move forward with the TSPLOST ballot, but the county can only impose a levy at a maximum rate of 0.75%, or some lesser amount in 0.5 increments. If negotiations go smoothly and an IGA is executed, the TSPLOST may be levied up to the full 1%, again in 0.5 increments.

Resolution

After the IGA is finalized and the governing body of each party to the IGA has approved execution of the IGA, the county must approve a resolution requesting the call of election to levy the TSPLOST. The resolution must state the transportation purposes to be funded, the approximate cost of such transportation purposes, the maximum period of time that the TSPLOST will be collected and the rate.  The resolution does not have to identify the specific projects. Typically, the resolution also includes as an exhibit the form of the Notice of Call of Election, and once approved, a copy of the resolution should be provided to the Elections Superintendent, who calls the election.

Election

The notice of the call of election needs to be published at least 29 days before the election, but since typically the ballot must be provided to the ballot builder 60 days before the election, practically speaking a county should schedule publishing the notice of the call of election at least 2 months before the election. The timing requirements are longer if the TSPLOST ballot is part of a presidential or state-wide primary or general election. We recommend building in extra notice publication dates in case the local newspaper misses a date.

The form of the ballot is prescribed in the TSPLOST statute and must include the rate and the term of the TSPLOST.  A request for authorization to issue general obligation debt in conjunction with the TSPLOST projects may be included as part of the same ballot question.

In advance of the election, the county needs to be careful not to run afoul of the general principle that public funds and resources may not be spent, directly or indirectly, to promote the referendum. Remember:

  • You can use public funds to explain the referendum, the projects and why you approved the call of election.

  • You cannot use public funds to endorse the referendum.

If the TSPLOST doesn’t pass, the county can resubmit it for vote again, subject to all the foregoing TSPLOST requirements.  According to the ACCG, since 2017 there have been 31 single county TSPLOST referenda. Of the 31, 7 (23%) failed to pass.

AFTER THE ELECTION

If the TSPLOST passes, then the TSPLOST will be levied beginning on the first day of the quarter following at least 80 days after the election. Thus, if your election is in November, the first day of the TSPLOST will be April 1.

The TSPLOST will end on the earlier of 5 years (or the time established in the ballot) or the last day of the quarter in which the county has collected all of the estimated project costs identified. The projects do not need to be completed in 5 years.

If general obligation debt was approved as part of the TSPLOST election, the county can proceed to issue the bonds without a separate referendum. As with the SPLOST, there are record keeping and reporting requirements related to the TSPLOST. Finally, a county can hold its election to renew the TSPLOST before the existing TSPLOST expires.

Transportation projects and improvements can have immediate impact to the local community that uses the roads, streets, sidewalks, and bicycle paths built with TSPLOST funds. Don’t hesitate to call Shaney Lokken or any Murray Barnes Finister lawyer if you have any questions. I wish you many smooth jogging miles throughout Georgia!