RALEIGH – Charlotte-Mecklenburg is about to have a spirited, consequential, and slightly silly debate about mass transit and the local tax burden. It’s about time.
It looks increasingly likely that voters this fall will have a chance to say yea or nay about Mecklenburg’s extra half-cent sales tax, which funds controversial transit projects and pushes the community’s combined tax burden well above that of any other urban area in North Carolina. You can tell the referendum is coming not just because the mathematics of the petition drive so far add up to enough signatures by the deadline, but also because Charlotte politicians and transit activists are clearly growing antsy, anxious, and, again, slightly silly.
The story begins in 1998, when a solid majority of voters approved a half-cent increase in the local sales tax to fund a transit plan that included bus corridors and rail lines stretching across the county. At the time, voters were assured that the planned transit lines would bear a modest price tag – about $1 billion for the whole shebang, including rail and bus lines – most of which would be financed by state and federal taxpayers outside the boundaries of the Queen City and Mecklenburg County. Frustrated by worsening traffic, which transit-tax advocates misleadingly suggested would be alleviated by the plan, and convinced that they’d get more dollars from afar than they’d surrender from their own wallets, Mecklenburgers said yes.
The reality has turned out differently. The initial rail project, along the South Corridor, will cost about half a billion dollars, or double the original estimate. The price tag for the entire plan is now pegged at $9 billion. Rather than take into consideration Charlotte-Mecklenburg’s resulting higher government-cost structure, local elected officials have enacted a series of other tax increases, infuriating taxpayers. And now transit officials want to proceed with a northward rail line and other projects that probably won’t get federal funding.
Seeing a clear opportunity to transform public disaffection into policy change, local activists created a web site, StoptheTrain.com, and an effort to collect enough signatures to return the transit tax to the ballot in November 2007. Originally, local politicians dismissed the campaign. Then they saw the numbers, panicked, and began a hard-charging counterattack.
They claimed that Mecklenburg taxpayers didn’t understand the petition language and didn’t realize what they were signing. They said that if the tax repeal killed the rail lines, Charlotte’s air would get smoggier and the region could lose federal transportation funds. And they pointed out that the anti-tax campaign was employing paid some workers to gather signatures. These were panicky, misleading, preposterous attacks, given that fact that the petition language is crystal clear, no one seriously claims the rail lines would affect traffic congestion or air pollution, and citizen-initiative campaigns routinely make use of paid staff. North Carolina is just not used to the notion that average folks, rather than political elites, should have access to the ballot to submit important issues to a public vote.
The more-clever ruse was to argue that because most of the half-cent transit tax goes to bus service rather than rail construction, repealing the tax would require either draconian cuts in bus services or painful property-tax increases. It’s clever because many citizens believe bus service is a legitimate local function (albiet more of a public-assistance function than a transportation service) and because property taxes are by far the most-unpopular taxes that local governments levy. If transit-tax defenders can convince Mecklenburg taxpayers that they’ll just be swapping one tax for another, the referendum might fail.
However, to accomplish that, transit-tax defenders will have to hope that Mecklenburg taxpayers don’t learn the facts. The truth is that local authorities have squandered the sales-tax revenue on bus service of questionable value. Ridership is up a bit, sure, but costs are up much, much more. Plus, it’s not as though city and county governments have no low-priority spending in their budgets that could be converted into transit funds if needed, rather than jacking up the property-tax rate. My colleagues in the JLF research department will be releasing details on these issues shortly.
In the meantime, find a comfy spot and microwave some popcorn. This is going to be a long, fascinating show.
Hood is president of the John Locke Foundation.