Due to an economic downturn caused by the COVID-19 pandemic, the city of Sandy Springs is about $30 million short on the monies it needs to complete all 12 of the projects funded by the current transportation special-purpose local-option sales tax (TSPLOST) cycle, which ends in 13 months.
“We have not collected as much in sales tax revenue as we hoped. We have to cut some projects, and the council must vote to approve (them),” Mayor Rusty Paul said.
Paul and other city officials spoke on the issue at the Sandy Springs City Council’s Dec. 1 work session, which was held virtually due to the pandemic.
In June 2016, the council voted to approve the city’s wish list of projects that was passed later that month by the Fulton County Board of Commissioners as part of a countywide list. Then, in November of that year, the county’s voters approved a referendum calling for a 0.75% sales tax fund those plans.
Over five years, the tax was expected to collect $560 million for transportation projects in Fulton’s 14 cities outside Atlanta, with distribution to each city tied to population. In Atlanta voters approved two separate TSPLOST referenda for taxes totaling 0.90%, with the first one a 0.50% tax for MARTA and transit in general and the second one a 0.40% tax for preapproved TSPLOST projects.
Sandy Springs was expected to receive $87 million to $119 million for its TSPLOST developments, but it likely won’t get more than $90 million due to the economy, said Kevin King, the city’s representative on the Fulton TSPLOST Citizens Oversight Council.
That means Sandy Springs has three options, assuming voters approve renewing the tax in November for another five years, which may be tough since only 52.7% of residents casting ballots in 2016 voted yes.
“Path number one: keep the same model over the next five years,” King said. “We’d have the same arrangement with the other cities in Fulton County outside of Atlanta,” he said. “Path number two is there is a possibly MARTA would want to establish a north-and-south regional bus lines that would be financed by some of this TSPLOST money, such as a quarter of a percent. Our $90 million would effectively be cut to $60 million.
“Path number three is we increase the tax from three-quarters of a percent to 1%, with a quarter going to MARTA so we would keep the same three-quarters of 1%. That would require the state Legislature to create a voter referendum. The reason that’s important is the Legislature starts in six weeks, and we should need to consult with the other cities and get a plan together.”
Paul said Sandy Springs is seeking funding sources from the Georgia Department of Transportation, Gwinnett County and Perimeter Community Improvement Districts to help offset the budget shortfall, and already has gotten commitments from the districts to help with two projects.
Sandy Springs has three different levels of projects, with the highest priorities being Tier 1 and the lowest Tier 3. The six Tier 1 projects cost the most ($88 million), and Allen Johnson, the city’s TSPLOST program manager, said they will be dropped to $80 million by cutting some costs on each one. The most expensive Tier 1 project is the Johnson Ferry Road-Mount Vernon Highway improvement plan, at $25.7 million.
The five Tier 2 plans cost $15.5 million, and the lone Tier 3 project (citywide roadway maintenance and paving) costs $15.6 million, with both tiers facing similar cuts.
“We want to find a way to balance the program,” Johnson said. “We want to consider all projects where design has started, consider maintaining some healthy investment in last-mile connectivity, and we’re not trying to carry over TSPLOST 1 project costs to TSPLOST 2, other than the Hammond Drive improvement plan.”
The Hammond development has a total cost of $60 million, is listed as a Tier 1 project and is expected to get $15 million for Phase 1 from the current TSPLOST.
District 3 Councilman Chris Burnett said he’s concerned the tax’s budget shortfall could jeopardize the plan, which includes widening a portion of Hammond from two lanes to four. District 6 Councilman Andy Bauman asked what would happen if the next TSPLOST was denied by voters.
In both cases, Paul said Sandy Springs would seek alternative funding sources to help complete that project.
As it did in 2016, the city will have to go through the same process next year to get its TSPLOST 2 projects approved.