MADISON, Ala. – There have been mixed reactions to the gas tax increase Governor Kay Ivey signed in March after the Alabama Legislature spent a quick special session on its passage. Now Steve Smith, Madison City Council president, is speaking out about what it means for Madison and why he is concerned about the way funds will be distributed.
The ten cent tax increase would be phased in over three years, to begin in September. Groups have come out against it, and the Alabama Republican Party executive committee opposed the measure.
Smith said Tuesday that he wishes the city had been consulted before the tax increase was approved.
“I just wish the state would work with the municipalities a little bit better,” he said.
Smith said once he dug into the numbers, he felt Madison wasn’t getting enough out of the deal.
“After it’s fully implemented, Madison will send $2 million down to Montgomery on an annual basis,” he said. “Out of that $2 million, we are going to get 25% of it back to us from our road projects.
He believes that won’t get Madison very far.
“$500,000 a year from the state will enable us to pave 5 miles of road,” he said. “The city of Madison has 300 miles worth of roadway in its city limits.”
Madison, he said, is already taxing gas by 18 cents per gallon. The way it is now, he said 16 cents of that already goes to Montgomery. Two cents stays in Madison. They get $820,000 back from the state annually. The increase, once it’s fully implemented, would bring the city up to 28 cents. He said that compounds the problem even more.
“Everything we are accumulating here, we are not reaping the benefits of it,” he said. “We are a growing community. Roads are a high priority not only for our city, but for our citizens.”
This is something Jess Brown, WHNT News 19 Political Analyst, has explained in previous reports.
“When you look at total road mileage, to include municipal streets that we travel in Alabama, the cities have primary responsibility for a noticeable share of the overall road mileage, but cities are only going to get 8 percent,” Brown said on March 5.
Smith believes every dollar people give toward the gas tax, the less they can spend in Madison to bolster sales tax revenue.
That’s money Madison is relying on to fund crucial city projects.
“That’s $2 million less for our citizens to spend in city limits. What that means for Madison is $50,000 in sales tax revenue for us on an annual basis. That’s the cost of outfitting a police car, maybe a fire SUV. Something we could use to provide services to the citizens.”
Madison is working hard to manage its growth through a growth policy. This is meant to allow time and funding to bring the city’s roads and schools to a place where they can support the expanding population. The school district needs multiple new school buildings, leaders said. But Smith believes the extra gas tax isn’t helping the city catch up.
He believes teamwork is needed to win that race.
“Maybe reach out to Madison County, reach out to Limestone County, reach out to Huntsville so we can collaborate and find some projects that the state can come in and use some of the gas tax money for us to complete maybe like a highway 72 improvement,” he suggested.
The gas tax increase is expected to generate $323 million annually statewide by 2022 when it is fully implemented.