Nashville Mayor to Lean on State for Transit Funding Tools
The Tennessean, Dec. 23, 2016
By: Joey Garrison
Megan Barry campaigned hard on transit during her run for mayor of Nashville, and since taking office she’s said she’s ready for the shovel to hit the ground to start turning plans of a future regional transit system into reality.
But as 2017 approaches, Barry —15 months into her job — still isn’t ready to say how Metro intends to begin paying for components of a regional transit system estimated to cost $6 billion over 25 years.
That's because under her strategy, Barry first needs enabling legislation approved by the Tennessee state legislature and Gov. Bill Haslam to allow Metro and other local governments to even have the option of dedicating certain types of local tax revenue for transit. That likely means Barry won’t be proposing a funding package for several months or longer.
Although scope of the state legislation would be limited, passage is no sure thing in a Republican-controlled legislature that has balked at transit historically, having helped thwart Nashville’s proposed Amp bus rapid transit project two years ago.
In a letter to the Metro Council on Thursday, Barry, a Democrat, updated members on her administration’s efforts to identify transit funding. She pointed to the first hurdle of getting state enabling legislation — a reality that has been no secret to Barry and other stakeholders pushing hardest for transit in Middle Tennessee.
“To meet the challenge of building a comprehensive transit network, we will need state legislation in the form of authorizing legislation that will allow us to create responsible and sustainable funding mechanisms,” Barry says in the letter.
“Our desire is to have the broadest set of tools possible to address our needs, while working with Governor Haslam’s administration and key legislators to craft a law that can earn the support of the Tennessee General Assembly.”
The legislature convenes for session in January. Barry hasn’t said which types of revenue streams she supports for transit, but several possibilities would require state action.
A few include using Nashville’s local option on sales tax for transit, the local portion of the state’s tax on gas and a special land value capture tax. The latter would place a special tax on properties around newly built transit infrastructure that are expected to benefit economically from future transit expansion.
A transit committee of the Nashville Area Chamber of Commerce dubbed Moving Forward recently recommended each of these revenue ideas among seven funding possibilities for further study. Others options floated include a new tax on commercial parking, a share of hotel-motel taxes, using property taxes or increasing the wheel tax, which refers to vehicle registration fees.
Five of the seven require state enabling legislation.
“Our top priority related to transportation is making sure that local communities have the necessary tools available to them to help solve their transportation and transit needs,” said Marc Hill, the chamber’s chief policy officer.
“We’d like as many of those potential revenue sources to be in play as possible because every community will have to decide what the right revenue source is. It may be one source. It may be a package. Right now, the options are very limited.”
GOP support key for passage
The boards of the Metro Transit Authority and Regional Transportation Authority — the latter comprised of 28 Middle Tennessee mayors and Haslam appointees — in September unanimously adopted a regional transit plan called nMotion.
The $6 billion plan calls for full gamut of transit options in three phases over 25 years: commuter from Nashville to Clarksville; new light rail lines on Nashville Gallatin Pike, Murfreesboro Pike and Nolensville and Charlotte pikes; bus rapid transit: and “freeway BRT;” and bus-on-shoulder service on Middle Tennessee interstates.
State enabling legislation aimed at local transit funding options hasn’t been filed at this point. It’s unclear whether Republican, Democrats or a bipartisan coalition will carry the bill or bills.
Gov. Bill Haslam is expected to propose a transportation funding plan that could include an increase on the gas tax, a proposal he’s discussed for years but never formally put forward. The state’s 21.4 cent per-gallon tax has been in place for nearly 30 years, helping create a backlog in road, bridge and other transportation infrastructure projects totaling between $7 billion and $10 billion.
Haslam hasn’t said whether his transportation plan would set aside some new revenue for transit projects but has said the state has a role to play in addressing Middle Tennessee’s traffic congestion through transit.
"We're definitely aware of the issue and have had a number of conversations with people in Middle Tennessee about transit," Haslam press secretary Jennifer Donnals said. "The issue of transit continues to be part of the overall conversation about the state’s transportation needs."
Republican leaders say they are open to the idea of enabling legislation that would let local government use certain revenue streams for transit. But without any legislation on the table, GOP leaders aren’t committing their support.
“Until I see it, I wouldn’t want to say yes or no, but I would look favorably on that because they’re elected by their people too and there’s things that they want to do,” House Majority Leader Glen Casada said. “It’s another tool that I think they could use and use wisely.”
Republican House Speaker Beth Harwell of Nashville stopped short of an endorsement as well, only saying she would support a local public referendum to decide transit investments — an approach used in several municipalities in other states.
“The infrastructure needs around the state, and particularly here in Nashville and Middle Tennessee, are great and need to be addressed,” Harwell said. “Without a specific proposal before the legislature, I can say that I am supportive of a local option dedicated revenue stream if it is granted approval through a referendum of local citizens.”
Nashville Democrat pushes one proposal
State Democrats, far outnumbered by the Republican majority, plan on introducing transit-related legislation next session that would go beyond just enabling legislation.
State Rep. John Ray Clemmons, D-Nashville, said he will introduce a comprehensive transportation and transit funding bill that would include an increase on the state’s gas and diesel taxes. Under his plan, rates would change based on inflation and population growth to avoid having to revisit the issue.
He said his bill would also set aside sales tax revenue that is collected above a certain threshold for transit.
“This doesn’t pit rural versus urban,” Clemmons said. “It creates a dedicated revenue stream at the state-level for more mass transit and alternative forms of transportation in a manner that doesn’t raise taxes or create new ones.”
He said he understands passing a bill like this one is a high bar for a backbench Democrat, but hopes Haslam and Republicans will adopt pieces of the concept.
Metro brings in new lobbyists at state
Metro is heading into the state legislative session with a new lobbying law firm representing their interests at Capitol Hill, Adams and Reese, which has replaced Windrow Phillips Group. The latter included lobbyist Bill Phillips, who served as deputy governor under former Nashville Mayor Bill Purcell.
Mayor’s office spokesman Sean Braisted said Windrow Phillips’ contract expired and that Adams and Reese was picked following a competitive bidding process.
Months ago, Barry had circled the end of this year as a benchmark for identifying possible mechanisms to pay for transit, but it appears she won't have a proposal until the end of the legislature’s next session at the earliest.
She told the council in Thursday’s letter that her goal is to create a funding package that is “sustainable, equitable and has broad public support.” She added that conversations and action by the legislature over the next few months “will better inform decisions” on what the package would look like.
Besides local funding options for transit, Barry, in her letter, said the mayor’s office plans to also track state and federal legislation for greater infrastructure funding.
Barry pointed to the possibility of new infrastructure dollars from a possible state gas tax hike and President-elect Donald Trump’s pledge for a $1 trillion infrastructure program.
If infrastructure funding become available, Barry said her administration will be “proactively seeking Davidson County’s fair share” of tax dollars.
Reach Joey Garrison at 615-259-8236 and on Twitter @joeygarrison.