Saturday, May 3, 2008

Goldwater Institute: $42 Billion Transit Proposal Moves in Wrong Direction

By Byron Schlomach

After months of rumblings around the state capitol, a private coalition called TIME transit
Transportation and Infrastructure Moving AZ's Economy - has unveiled a $42 billion solution for Arizona's transportation problems. It can be summed up as "tax and spend."

Under the proposal, the state's sales tax would increase by one cent. By itself, a cent seems small, but this would make Arizona's state sales tax rate the fifth highest in the nation according to the Tax Foundation . Arizona already has the nation's twelfth highest weighted sales tax rate--the state's sales tax rate combined with the average city and county tax rates. The proposed change would move us to fifth highest, almost on a par with New York.
Unfortunately, transit has proven itself an efficient consumer of tax money and not much else. On average, fares cover only 40 percent of operating costs and none of the initial investment.
Arizona needs more roads, but the last thing our economy needs is more taxes. Current transportation plans need to be scrubbed of inefficient projects and greater emphasis needs to be placed on private sources of transportation funds.

Today the Goldwater Institute will release a policy report that examines Arizona's transportation challenges and suggests how to meet them without raising taxes. The bottom line is that with a little creativity and innovation, we can fund our transportation needs without raising taxes.

Dr. Byron Schlomach is the director of the center for economic prosperity at the Goldwater Institute.

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