A major financial rating agency reported that Atanta’s credit rating could be hurt by the city’s rejection of an $8 billion transportation tax last week, according to The Hill:
Moody’s Investors Service said the defeat of a proposed a one-cent state sales tax increase via a Transportation Special Purpose Local Option Sales Tax (T-SPLOST) was a “credit negative” for the city of Atlanta, the Atlanta Journal-Constitution reported on Tuesday.
“The Atlanta region needs major upgrades to its dated and limited transit system and congested roadways to maintain its long-term position as an influential economic center,” the agency said. “The region will now be challenged to fund such projects on a local or state level, as the region had not formulated a specific contingency plan for identified projects if voters rejected the tax.”
The tax proposal was voted down in a closely watched election by an almost 2-to-1 margin, losing 63 to 37 percent. Supporters said it would have generated more than $8 billion for a 10-county region surrounding Atlanta.
The proposal was voted down in 9 of 12 multi-county regions in Atlanta that has created predetermined lists of road and transit projects that would have been funded.
Moody’s said the defeat was especially bad for Atlanta “because of the city’s position as an economic hub, which could be hurt by the area’s current condition of infrastructure.”
The agency added that the approval of the transportation tax was a “credit positive” for the regions of Georgia that voted to pass the proposal.
The tax was approved in three regions, mostly in the middle and eastern parts of Georgia, where it is scheduled to generate approximately $1.8 billion for infrastructure projects.
“These regions will benefit during and after the new sales tax’s 10-year collection period as the proceeds will fund a combined 121 transportation-related projects,” Moody’s said.
Atlanta Mayor Kasim Reed (D) has called for another transportation vote in the city, but Georgia Gov. Nathan Deal (R) has said he is not interested in holding another referendum on road and transit funding.