Category Archives: Money

Is The Current MARTA Vision Worth The Chase?

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The article below was written by Mayor David Belle Isle, the mayor of Alpharetta, who gave me permission to share it with you here.

 

Is The Current MARTA Vision Worth The Chase?

I’m a vision guy. I love looking at something and imagining what it could be; what it could be like; and how to get there. I love chasing a vision and seeing the pieces fall into place. But, for a vision to be worth the chase, the promise of “what could be” has to be better than “what is.”

Last week, I found myself in a makeshift room midway up the interior back stairs of the State Capitol. The room was packed. The air was hot. I was there to testify on behalf of Alpharetta at a committee hearing on the proposed MARTA expansion bill, SB 330. To my surprise, the room was not full of concerned every day citizens seeking faster commute times to home and work. Rather, it was filled with developers, lobbyists, and employees of chamber and public policy groups. Indeed, a total of 7 lobbying firms have been retained to make sure this MARTA bill gets passed and that you vote for it. Big money. Big stakes. Big supporters.

Among others, two developers spoke of how wonderful the MARTA expansion would be for the economy, specifically their economy. They introduced a new phrase: “transit premium.” This is the concept by which the properties serviced by the rail will increase in value by 50%. This is fantastic! Fantastic, that is, if you’re a property owner or developer near a proposed new transit station.

On the whole, I firmly believe that the expansion of public transit is part of the solution as we look to shorten our drive times to home and to work. But, the current $8 Billion proposal has me scratching my head:

  1. What About the 97%ers? Only 3% of commuters within reach of the current rail use MARTA and ridership is down over the past 10 years.
  2. Convenience Factor. For most, using rail involves a six-part process: a drive to the station, a wait for the train, a ride on the rail, a wait for a bus, a ride to a bus stop, and a walk to their building. Real people will weigh that time and hassle against driving straight to work.
  3. Transit for Everyone… Else. Many who support the expansion of MARTA rail are laboring under the hope that others will take the train so that their drive downtown won’t take so long.
  4. Until Death Do It Tax. 43 years is a long time to pay a tax on everything you purchase. This puts the full payment outside my life expectancy. I’m 40.
  5. Bait and Switch. The MARTA project list is disposable. MARTA is not obligated to build the projects the voters are being asked to fund. They should be.
  6. Hadn’t Thought of That. No one has thought to measure the expected improvement, if any, along Georgia 400. For an informed vote, we need to know how much quicker our drives will be.
  7. Federal Match? The proposed expansion is dependent on federal matching funds of $4 Billion. There is no obligation by the Fed to commit these funds. Before MARTA expansion hits a ballot, there should be.
  8. I’m Against What? The ballot question is worded in a way that a “No” vote implies you oppose traffic relief and economic development. The question should be neutral.
  9. Stacked Deck for Alpharetta. If successful, 3 new transit stations will attract 3 new streams of traffic from surrounding areas and require 3 new 2,500-car parking decks constructed MARTA-style.

I truly want to see us, as a region, take on traffic and develop a comprehensive plan. I can see it. That’s my vision. It is imprinted on my mind. Yet, we need to look at all the options openly: heavy rail, new roads, light rail, additional lanes, bus-rapid-transit, managed lanes, bus circulator programs, intersection improvements, signal timing, adaptive traffic, Uber, driverless cars. If we’re not careful, we’ll spend more than half of our transportation dollars on 3% of our commuters. “What could be” will be no better than “what is,” except we’ll have the pleasure of paying for “what should never have been.” The best answer probably lies in some combination of travel methods. We don’t know. But before we vote, let’s find out if this vision is worth the chase.

 

 

Opinion of Mayor David Belle Isle

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For months Fulton County mayors have been meeting to negotiate an agreement regarding a transportation sales tax which was authorized in House Bill 170 passed by the Georgia legislature in 2015. Below is a press release issued today by Alpharetta Mayor David Belle Isle regarding the matter.

I support our Mayor’s critical approach to an issue that is vital to the future of our region and our state. I am proud to serve with a man who has the courage to stand up for what we both know is right regardless of which way the prevailing political winds may be blowing. You can click below to view the whole statement.

 

DBI MARTA statement

Legitimate Poll shows Overwhelming Opposition to Rail in North Fulton

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Supporters of Georgia State Senator Brandon Beach’s MARTA tax increase bill, SB 313, have made many claims about public support for the legislation. As an elected representative of 63,000 people who live in Alpharetta I know many of those claims are inconsistent with the truth. That is why I am pleased to release the findings of an objective, statistically valid poll which demonstrates the people of North Fulton overwhelmingly oppose such a tax increase for the purpose of extending heavy rail in the region.

Legitimate Poll shows Overwhelming Opposition to Rail in North Fulton

Voters in the 5 major cities of North Fulton county have spoken and oppose a massive tax increase to support a Marta heavy rail extension.  When presented with a reasonable and accurate set of facts, the poll showed a clear landslide rebuttal.  Women opposed the tax increase and rail line by almost 63% and Republicans by almost 69%.  Democrats also opposed by a slim majority and African-Americans opposed by over 66%.  All age demographics were a majority against the tax increase and rail line. The poll was conducted by Landmark Communications a respected, non-biased firm.

 

Landmark MARTA poll

A decision of this magnitude deserves better

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In an earlier post I wrote about my experience at the state capital last week. For more background you should also read this article about the hearing at GeorgiaPol.com.

As I testified at the senate hearing Senator Beach commented, “We can disagree without being disagreeable” and I couldn’t agree more. That is why some of the comments made by him and others supporting his 50% MARTA tax increase are so troublesome.

That doesn’t make sense to Beach. MARTA’s opponents, he said, are desperate for solutions. “Some of the politicians are saying, well, nobody is going to use it, and then in the next sentence they’re saying it’s going to create so much congestion coming into it. Well, you can’t have it both ways. If you’re going to have all this congestion, you’re going to have ridership. Just tell me one or the other.”

“The politicians are scared to death” of MARTA expansion, Beach said in an interview earlier this week.

What a perfect example of heavy rail supporters insulting their opponents and misleading the public without addressing the facts laid out by their opposition. Senator Beach’s assertion that politicians say, “nobody is going to use it” is just false hyperbole.

I have never heard it said by any opponent of heavy rail. However I have repeatedly pointed out that the U.S. Census shows only 2% of Fulton County residents ride heavy rail to work.

fulton commute stats
Fulton commute chart

Yet while Senator Beach’s assertion that politicians say “nobody” is going to ride MARTA is false, his assertion that some say it’s going to cause more congestion is true and supported by facts.

Only 5% of the people who live in the zip code surrounding the North Springs MARTA station in Sandy Springs use heavy rail to get to work.

Commute chart Sandy Springs

And since only 846 people who live within walking distance of the station take trains to work MARTA had to build enormous parking garages. Why? Because most of the people who ride the trains have to drive cars to the station.

That is why rush hour traffic around North Springs is so bad the state of Georgia is spending a billion dollars trying to fix the problem while Sandy Springs is considering building monorails and the Perimeter CID is designing ways to expand surface streets to accommodate more cars, buses and trolleys at taxpayer expense.

So when Mr. Beach demands to know whether it is “one or the other” the response is “the other” because no politician says nobody will ride MARTA trains. Instead informed politicians say that while a small group of people around train stations will ride them the overwhelming majority of riders are forced to drive cars to the station making traffic worse.

Which means a bill dictating MARTA must expand using expensive, inflexible heavy rail lines along GA 400 will force commuters to crowd surrounding streets exacerbating congestion. The only public transportation that can effectively address existing congestion issues while improving economic development opportunities is Bus Rapid Transit (BRT).

The people of North Fulton are tired of congestion on the arterial roads and surface streets around GA 400. Of course other people have a vested interest in making sure transit forces people to visit the Georgia 400 corridor.

That’s why it was perfectly reasonable for Senator Beach to sponsor Senate Bill 313. Senator Beach is President of the North Fulton Community Improvement District (CID) a tax district created specifically to increase the property values of commercial properties along GA 400.

Understanding that, it makes sense for Senator Beach to pretend that North Fulton is doomed if taxpayers don’t spend billions of tax dollars to extend heavy rail into the CID there. No law forces political decisions to be decided on objective facts. So if Senator Beach supports a regressive tax increase which takes money from single moms in East Point to build train stations on three properties within the North Fulton CID it is perfectly fine. Even if it doesn’t seem fair, it’s good business for the CID.

Which is why it was also perfectly reasonable for Mr. Mark Toro to speak in favor of Senator Beach’s MARTA tax increase. Mr. Toro is a partner in North American Properties, the company now selling their Avalon mixed use development in Alpharetta. If Avalon is worth $500 million now it should be worth tens of millions more with a MARTA station. That’s just good business.

That’s the same reason Mr. Toro was a vocal supporter of the failed Tsplost tax that would have brought heavy rail to Atlantic Station in 2012. Now that North American has sold Atlantic Station and has Avalon on the market it is no surprise he supports a bill forcing Johns Creek retirees to pay for a MARTA station there.

And if Mr. Toro has to tell people who live in the City of Atlanta that objections to Senator Beach’s proposal are based on “racism” and a “bunch of old white guys”… so be it. If that’s what it takes to convince minority taxpayers in Atlanta they should pay for a 2.4 billion dollar amenity in the North Fulton CID, that’s just good business.

But the truth is that most elected officials in North Fulton support expanding some form of transit. Objections to Senator Beach’s 50% MARTA tax increase are not based on racism, irrational fears or muddled thinking but on sound reasoning and fiscal responsibility.

SB 313 diverts billions of dollars from efforts to build a sustainable transportation network that can support a vibrant region and directs them to an overpriced, inflexible mode of transportation that primarily benefits the commercial properties like Avalon within the North Fulton CID. To characterize principled, informed opposition to Senate Bill as irrational fear or uninformed reactionary politics is insulting.

A decision of this magnitude deserves better.

 

That’s the problem

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Last Thursday I attended the Evening to Support Transit Expansion With Senator Brandon Beach in Alpharetta hosted by the organization Advance ATL. It was a friendly and informal event held to support Alpharetta State Senator Brandon Beach’s proposed legislation which will permit Fulton County to increase the current MARTA sales tax by 50%. The additional $130 million a year would fund the expansion of MARTA’s heavy rail trains as far as Windward Parkway in Alpharetta.

Most of the people who attended were affiliated with Advance Atl but there were also representatives of the Sierra Club, the Council for Quality Growth and the Atlanta Regional Commission among others. There was even a state legislative candidate from Gwinnett County advocating better transit access for the impoverished immigrants in the district she would like to represent.

Of the 35-40 people attending I only spotted 5 people who live in Alpharetta: Senator Brandon Beach and his lovely wife, Alpharetta City Councilman Jason Binder, one person who identified himself as an Alpharetta resident and me. Suffice it to say that for an event to support a transit tax hike that will have an enormous impact on the people of Alpharetta the crowd was overwhelmingly composed of millennials who drove from inside the perimeter.

The casual environment of the event provided an excellent opportunity to discuss transportation, taxes and transit with people who are actively lobbying to pass Senator Beach’s tax hike. I found my conversations with a gentlemen who is a Transit Coordinator for the Atlanta Regional Commission (ARC) and a woman who is a transit advocate for the Sierra Club especially enlightening.

The Transit coordinator for ARC actually made the most thought provoking comment of the evening to me. He and I had a great discussion about heavy rail, my reasons for believing heavy rail would be the absolute worst possible transit option for Alpharetta and why based on those reasons I believe Senator Beach’s tax increase would have a devastating impact on the future of Alpharetta and North Fulton County.

We discussed the point that heavy rail was too expensive for the small number of people it would serve. We discussed how heavy rail was too inflexible to justify the exorbitant expense at a time when the future of transportation will be determined in large part by innovations like self driving automobiles and more flexible work environments. We even discussed how heavy rail would create worse rush hour traffic in North Fulton because it would concentrate heavier automobile traffic on the arterial roads as the majority of train riders would have to drive from other areas during the times our roads are already the most congested.

Then I mentioned that heavy rail was also the worst possible solution because it would never serve more than 7% of the surrounding population and would therefore never be feasible given the residential densities which foster the quality of life people here desire. His candid response was,”Well… that’s the problem.”

That’s when I realized that to a transit coordinator from the Atlanta Regional Commission the problem is that the people of Alpharetta reject the dense, urban environment needed to justify exorbitantly expensive and inflexible trains which would only make our traffic worse. Which is very different than the problem from the perspective of people who live in Alpharetta, prefer our green spaces, great schools and low crime rates but don’t want to be stuck in traffic on their way to work or back home to the lifestyle they love.

On one hand you have rail advocates who want suburban Alpharetta to become a dense, urban environment to support the lifestyle and transportation mode they prefer. But on the other hand you have people who enjoy a quality of life that can’t exist in an urban environment and simply want a cost effective mode of transportation to support their lifestyle. So when we get right down to it that is the problem: as a region we haven’t agreed on the problem we are trying to solve and if we can’t agree on the problem we will never agree on the solution.

North Fulton is a pretty affluent area. If most residents in Alpharetta or Johns Creek or Milton wanted to live in Sandy Springs or Buckhead they could… but they don’t. They prefer exceptional school districts, lower crime rates, and single family homes with yards for children and pets to play in. That is why they live here and they expect their elected officials to provide transportation solutions which support that quality of life.

I ran for office because I love Alpharetta. I love living in a city full of diverse people from all over the world who have chosen to make Alpharetta their home because they believe it is the best place in Georgia to raise a family and do business. I love my single family house on a 1/3 of an acre with grass and oak trees on a cul de sac lot. I love coming home to deer and chipmunks in my front yard and the occasional hawk or owl perched on my son’s basketball goal. I believe Alpharetta is a special place and so do thousands of other people who invest their time and money in this community to keep it that way.

And yet my neighbors and I are not so arrogant as to believe everyone should share our preferences. I have never heard a neighbor criticize people who live in Buckhead or Kirkwood for choosing to live in areas with higher crime and poor schools because they prefer urban environments with easier access to heavy rail. I have also never heard any of my neighbors advocate for higher taxes on those people who don’t choose our lifestyle to subsidize our preferences.

Different people have different priorities and should have the freedom to live as they choose as long as it doesn’t negatively impact other people’s rights. Fortunately events like the one Advance ATL hosted allow people with different backgrounds and perspectives to share their views face to face.

Because until we agree on the problem we can’t hope to find a solution… that’s the problem.

Senator Beach Proposes 50% MARTA Tax Hike

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Every man, woman and child in Fulton county has to pay a 7% sales tax which means a hundred dollar pair of shoes really costs them $107. Of that $7 tax one dollar goes to subsidize MARTA. It may not sound like much but over the course of a year it adds up to about $265 million dollars.

Now two hundred and sixty five million dollars is a lot of money no matter how you look at it but in a county with a million residents it might be justified if the taxes were going to something everyone uses, needs or wants. Unfortunately in a county plagued by congestion only a tiny percentage of Fulton County residents use MARTA trains during rush hour.  The census charts below demonstrate only 2% of the county’s population ride MARTA trains to work.

Fulton commute chartFulton commute stats

More people work from home or even walk to work than ride MARTA trains but we pay hundreds of millions of dollars to subsidize the trains. It is a perfect example of why Fulton County already has transportation issues. Politicians allocate transportation money based on politics rather than sound fiscal policy.

Which brings us  to this news story from 11 Alive News about Alpharetta’s own State Senator Brandon Beach who is proposing a 50% MARTA sales tax hike to expand trains into North Fulton. While I couldn’t disagree more with Senator Beach on this issue I do appreciate his consistency. He was pushing for heavy rail in his dual role as CEO of the Greater North Fulton Chamber of Commerce and President of the North Fulton CID long before he was elected to the state legislature.

But there is absolutely no objective justification for a massive tax increase to expand the least used, least efficient, least flexible and most expensive transit option available in Fulton County. Over the past few decades billions of dollars have been spent to subsidize a rail system which serves a tiny  portion of our population while the roads that support 100% of residents have been sorely neglected. Any further diversion of transportation money to MARTA trains will only make the problem worse.

A transportation tax increase of hundreds of millions of dollars on Alpharetta residents dedicated to trains that would make traffic here worse would be unconscionable so as an elected representative for 63,000 residents I will not support this effort. Instead I will vigorously oppose any legislation which would permit a 50% MARTA tax increase and encourage my fellow elected officials in Fulton County to do the same.

 

How does China afford all those expensive trains?

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Yesterday I was reading an article in the Wall Street Journal about General Electric opening an overseas headquarters in China. The article is behind a pay wall so I can’t link it here but as with all WSJ articles you can google the headline: GE Bases X-Ray Unit in China to read the whole thing for free. The article wasn’t anything special until I read the throwaway line in the last paragraph:

China’s central government increased its budget for spending on public health by 16% this year to $26 billion. In March, it allocated 76 billion yuan ($11.78 billion) to improving health-insurance coverage and increased insurance subsidies to 200 yuan a person, up from 120 yuan.

China only spends $26 billion on public healthcare? Really? That is less than $26 a piece. Assuming the WSJ reporter is correct that would mean China spends about 1/3rd of one percent of their $7.8 trillion gross domestic product on healthcare. No wonder China can afford to waste hundreds of billions of dollars on high speed trains that don’t run in thunderstorms and shiny new ghost towns.

For comparison’s sake the Congressional Budget Office says that the United States Government is currently spending just less than 6% of our entire GDP on healthcare and that is when you only include ” the major mandatory health care programs”. That means the U. S. spends about $857 billion or more than $2800 per citizen on just the “major mandatory healthcare programs”.

So how does China afford all those expensive trains? Obviously one way they can afford it is by spending less than 1/1000th of what we do on government healthcare programs.

So even communist China realizes you can’t spend that kind of money on both healthcare and high speed trains without breaking the bank. Too bad our own president hasn’t figured it out.

The federal gravy train is pulling into the station

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Drudgereport.com had this headline: “USA has record $61.6 TRILLION in unfunded obligations; $534,000 per household…” The link leads to this report in USA Today. It is a powerful reminder that the United States is in a terrible financial situation and the current levels of government spending are unsustainable.

Read the whole thing but below are a few highlights:

The federal government’s financial condition deteriorated rapidly last year, far beyond the $1.5 trillion in new debt taken on to finance the budget deficit, a USA TODAY analysis shows.

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The government added $5.3 trillion in new financial obligations in 2010, largely for retirement programs such as Medicare and Social Security. That brings to a record $61.6 trillion the total of financial promises not paid for.

This gap between spending commitments and revenue last year equals more than one-third of the nation’s gross domestic product.

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The $61.6 trillion in unfunded obligations amounts to $534,000 per household. That’s more than five times what Americans have borrowed for everything else — mortgages, car loans and other debt. It reflects the challenge as the number of retirees soars over the next 20 years and seniors try to collect on those spending promises.

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The government has promised pension and health benefits worth more than $700,000 per retired civil servant. The pension fund’s key asset: federal IOUs.

The numbers in USA Today are astounding but it isn’t an isolated report. Back in May, Senator John Barrasso of Wyoming released this statement which says:

The numbers don’t lie. Every day, this government borrows another $4.1 billion. We are borrowing at a rate of more than $2 million per minute. Forty cents of every dollar Washington spends is borrowed money, much of it from China. Every American child born today and tomorrow and the next day owes more than $45,000.

The federal government cannot continue to operate this way. It is more clear than ever before that one day soon our nation has to make difficult choices or foreign investors will make those decisions for us as they are doing for Greece.

So what will local governments do when the federal funds dry up? The Wall Street Journal article Threats to Town Halls Stir Voter Backlash shows that budget woes are already forcing some local governments to consider consolidation against the wishes of many constituents. Here in North Fulton we need only look back to the consolidation of Milton County with Fulton County that occurred during the last Great Depression to see what happens when a municipal government is not sufficiently prepared for the fiscal issues it can face.

The current fiscal policies of the United States federal government are unsustainable. The gravy train of federal deficit spending is nearing the end of the line.  Will Georgia and its municipalities be prepared when it does? I hope so.

Alpharetta City Council’s Wish List for a Tax Increase

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Tonight the Alpharetta City Council is slated to vote on the list of projects to include on the transportation tax referendum next year. Proponents hope that a list of possible projects will entice voters into voting for higher taxes on themselves. You can see the list of projects on the city website here.

I also suggest you read this article about the transportation tax issue in today’s Atlanta Journal Constitution. The AJC article doesn’t do a very good job of summarizing the list being presented to Alpharetta City Council tonight but it does give a valuable overview of the process. Below are a few random thoughts on the transportation tax proposal:

1. I don’t trust the state of Georgia to live up to their end of the bargain. After the DOT and State Roadway and Toll Authority arbitrarily extended the GA 400 tolls I came up with a phrase to express my thoughts on the matter: “Once you vote to give the government your money they will do with it what they damn well please.”

2. Supporters of the tax increase include most of Georgia’s business and political establishment who try to portray the issue as just another penny for a great cause. It is important that taxpayers realize all those pennies add up to 8 Billion Dollars. That works out to about $3,300 the average family of four in Georgia will no longer have to buy gas, food or anything else they need.

3. Supporters of the plan point out that the tax is only authorized for ten years. Let’s be realistic, there isn’t a chance in hell that the tax will ever go away. If you doubt me look at what Cobb County did to push through the SPLOST tax extension.

4. The business and political establishment in metro Atlanta are determined to expand inefficient and expensive train service. One way they hope to achieve this goal is by rebranding MARTA as a shiny new regional transportation authority run by GRTA. Somehow they think that will make it more palatable to suburban taxpayers. This recent front page article in the Alpharetta Revue illustrates what I mean. While the article uses the transit authority in Chicago as an example it failed to also mention that census numbers show people are fleeing the city of Chicago, the state of Illinois is on the verge of bankruptcy and the Chicago Regional Transit Authority will cost taxpayers about 1.4 Billion Dollars this year.

5. Land development companies and speculators will reap billions of dollars in profits while shouldering none of the burden for the transportation improvements which increase their property values. That is why local Chambers of Commerce and Community Improvement Districts will invest millions of dollars to promote the new tax on consumers.

6. There is still no relief in the proposal for taxpayers in Fulton and Dekalb Counties who already pay a one cent transportation tax for MARTA that costs us about $350,000,000 a year. Last year North Fulton mayors threatened to withhold support for the proposed tax increase if it continued to unfairly punish their constituents but the resulting political backlash left them noticeably silent since then.

There is no doubt that the state of Georgia has neglected our road infrastructure as tax revenues boomed over the past few decades. I just think it is a horrible idea to make up for that mistake by raising taxes now that people are struggling with high unemployment, rampant inflation and declining property values. The state’s political and business community disagree.

It will be interesting to see what the people of Georgia decide when the issue reaches the ballot box.

Crisis caused by income equality or government intervention?

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There is a thought provoking interview with Raghuram Rajan in the December issue of Money magazine. Mr. Rajan is one of the few economists that warned our current financial crisis was coming and the article is primarily about Mr. Rajan’s theory that the current crisis is caused by income inequality:

“In the 1980s we saw a widening of income inequality. Typically the political reaction to that is to redistribute wealth. But in the ’80s and ’90s there was a sense that we’d had too much redistribution, too much welfare. So you had to find something else, and housing fit the bill for both political parties.

The Democrats thought it was wonderful to support home ownership for the poor, their natural constituents. The Republicans figured property owners would eventually vote Republican.”

Mr. Rajan then goes on to explain how the political issue of income inequality led the United States federal government to create the current crisis with their attempts to cure income inequality. I see a great deal of truth in what Mr. Rajan says but I would like to point out one crucial difference in how I view the problem.

It wasn’t income inequality that caused the current economic crisis. The direct cause of the crisis was the political response to income inequality. The difference is subtle but completely changes the diagnosis of the problem and if we misdiagnose the problem it is impossible to come up with the correct solution.

If income inequality is to blame for our current economic crisis then the federal government could prevent future crises by eliminating income inequality. In that case the the solution would be for the federal government to continue various forms of political intervention in the hope of solving income inequality. Of course Marxism and Socialism are two examples of such attempts and their results have been devastating.

On the other hand, if the current economic crisis was actually caused by clumsy political responses to income inequality we need to look for a different kind of solution. Maybe we could start by having politicans recite the Law of Unintended consequences: “An intervention in a complex system always creates unanticipated and often undesirable outcomes”. Then we could change the oath of office to “First, do no harm”. 

The interview with Mr. Rajan can be found online at CNNMoney.com