Show me the money? With TSPLOST on ballot, here's what to know about Chatham's local sales taxes

Since 1990, Chatham County's population has increased by more than 36%. At this rate, the county wilol welcome nearly 33,000 more people by the end of this decade, meaning more people will be driving on our roads and across our bridges as they move from home to work to school and back home.

Most of that growth is taking place on former farm land and forested areas that have yielded to industrial pressures as well as the absolute necessity for affordable housing.

TSPLOST proponents: Chatham's transportation infrastructure is overdue for upgrades. TSPLOST is the answer.

TSPLOST critic: TSPLOST promises shiny new roads, bridges, sidewalks. Consider the costs before you vote

At present, local governments don't excise impact fees that other locales use to pay for the roads, bridges, schools and other infrastructure to support growth. Instead, officials use special purpose local option sales taxes to raise funds for these types of projects for "pennies on the dollar."

Currently, Chatham County collects 2% sales tax on most goods and products sold within the county, with 1% going for infrastructure, known as SPLOST; and another 1% going toward education-related purposes, known as ESPLOST. County voters are being asked to approve a third 1% local sales for transportation-related projects, a levy known as TSPLOST. The TSPLOST referendum will appear on the Nov. 8 general election ballot.

Here's what you need to know about sales taxes:

What is a Special Purpose Local Option Sales Tax?

From the Association of County Commissioners Georgia:

• In 1985, Georgia enacted a law allowing counties to impose an additional 1% Special Purpose Local Option Sales Tax (SPLOST) to cover capital outlay projects proposed by the county government and participating qualified municipal governments.

• Capital outlay projects are defined by law as major projects that are of a permanent, long-lived nature, such as land and structures. The term expressly includes, without limitation, roads, streets, bridges, police cars, fire trucks, ambulances, garbage trucks, and other major equipment.

• County commissioners approve a detailed project list, then voters must approve the new tax in a referendum.

• County and municipal governments may not use SPLOST proceeds for operating expenses or maintenance of a SPLOST project or any other county or municipal facility or service.

Sales taxes are generally considered regressive, which means they hit low-income households harder than higher-income households, but Chatham County voters have generally voted for SPLOST by comfortable margins (see table below). Proponents of the tax, including governments and business groups, have been better organized than opponents, and voters have been swayed by the prospect of job creation and sustained investments in new and existing infrastructure.

If TSPLOST is approved on Nov. 8, how will it affect sales taxes here?

The current minimum combined sales tax rate on purchases made in Chatham County is 7%. If TSPLOST is approved in November, that rate will rise to 8%. Here’s a breakdown of where that money goes now and how it’s used.

Transportation Needs: TSPLOST would give west Chatham County's major roadways more lanes and better walkability

Increased Mobility: TSPLOST plans to improve sidewalks, trails; addressing Savannah area mobility

Some things to consider

Up to 40% of all sales tax collected in Chatham County is paid by visitors, so 2/5 of the cost of capital improvement is borne by non-residents.

A sales tax does not lead to increased property taxes, which means there is no corresponding increase in housing costs – an artifact of millage rates. However, passage of TSPLOST will cause the price to rise on anything on which you pay sales tax, those day-to-day expenses from groceries and gas to school supplies and shoes. (In Georgia, state sales tax does not apply to groceries, but local taxes do. So, a $4.38 gallon of milk will increase to $4.42 at the cash register.)

City Talk columnist Bill Dawers contributed to this reporting. His original article compiling SPLOST initiatives appeared in the April 2019 Infrastructure of Beacon magazine.

This article originally appeared on Savannah Morning News: TSPLOST puts focus on how local sales tax funds collected and spent