Fulton Country trasportation tax revenue short

Projections that Fulton County used to sell a 2016 transportation tax to voters were too high and have been scaled back.

Georgia State University researchers originally estimated that a three-quarter penny sales tax for road and other improvements would bring in $109.3 million in its first year, which ended in April. In reality, $94.3 million was collected.

That total is about 86 percent of what projected collections would have been, and means that cities throughout the county will have to cut some projects from their to-do lists, or find other ways to pay for them.

In Alpharetta, a project to build a wider sidewalk and bike lanes on Academy Street and Webb Bridge Road will be dropped if more money doesn’t come in. So will intersection improvements at Kimball Bridge Road west of North Point Parkway and bike lanes near Georgia 400. In Chattahoochee Hills, fewer roads will be repaved.

“We’re basically just focusing on tier one projects,” said Robbie Rokovitz, the Chattahoochee Hills city manager. “More money means more paving.”

Over five years, the tax was expected to bring in $569.3 million — and estimates said as much as $655 million could be collected.

Since the tax collection began, Georgia State has updated its numbers. Those are closer to reality, but still optimistic. The new projection anticipated collections of $95.8 million in the first year. Collections were 98 percent of the new estimates.

Laura Wheeler, a senior research associate at the Georgia State fiscal research center, said the discrepancy between the original estimates and the first-year collections came from a lack of data. The five-year, three-quarter penny sales tax only applies to Fulton County outside the city of Atlanta. Atlanta voters passed two different sales taxes: one, for four-tenths of a penny, for road and sidewalk improvements and another half-penny sales tax to fund MARTA.

Wheeler said before the taxes began, there was no way to know where in Fulton County people were buying taxable items, in Atlanta or outside it. So she used the best data available to make her estimates.

“This was a new tax. It’s always a challenge,” Wheeler said. “Forecasts always get better as you have actuals. In the absence of any data, you have to do an estimate.”

With the 2016 projections, cities laid out three groups of projects, delineated by priority. The most important ones should be covered with 85 percent collections; the least important ones needed collections to be at 115 percent of estimates to be funded.

Todd Long, Fulton County’s chief operating officer, said when the money came in more slowly than he expected it to, he thought at first that some retailers weren’t collecting the required tax. He found a few instances where that was true, but said for the most part that the tax was being collected properly.

Long said he expected local governments to do as many projects as they have the money for, and said the county will watch projections more closely going forward.

In Atlanta, where the city’s finance department performed its own estimates on its five-year, four-tenths of a penny sales tax for transportation that started last year, the news is better. There, collections of $56 million are higher than the expected $52.3 million.

“It’s good to know we have the potential for at least a little padding,” said Tom Weyandt, the interim general manager of Renew Atlanta and the city’s transportation tax program. “It’s pretty clear the Atlanta economy has bounced back pretty healthily. It didn’t surprise me that we exceeded the estimate.”

Wheeler, with Georgia State, acknowledged that the first round of estimates were off, but said the county needed guidance without sufficient information.

While some construction may be delayed because of the shortfalls, Alpharetta spokesman James Drinkard said his city will find other ways to fund the projects — and in fact, had always thought it might have to.

“We just thought it was overly aggressive,” Drinkard said of the estimates. “We’re always ultra conservative on revenue projections. More often than not, that proves to be wise.”