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DRIVETIME MAHATMA: On Issue 1: Nice roads, lasting tax

by Frank Fellone | September 26, 2020 at 9:25 a.m.

Dear Mahatma: Fight for a toll road versus a tax on the elderly! -- John

Dear John: You refer to a column about congestion on Interstate 40 between North Little Rock and West Memphis.

A mention was made of Issue 1, which if passed Nov. 3 would make permanent a temporary half-cent sales tax, the proceeds of which go to the Arkansas Department of Transportation, counties and cities. For road work.

Randy Ort of ArDot was asked, by us, if widening of I-40 was contingent on passage of Issue 1.

Not exactly, he said, but the money raised by Issue 1 could speed the process. There was also mention of tolls, but Ort said federal regulations don't allow for interstate tolls, except for those grandfathered in.

This reminds us of Old Dad, who lived most of his life in a state with tolls on a major highway. Old Dad would grind his teeth and say the tolls were supposed to go away when the highway was built. But the tolls lasted for many more years.

This brings us back to John, who vigorously opposes Issue 1.

What is our position? We won't say. Our job is to illuminate, rather than pontificate. Which reminds us of something else Old Dad used to say: "Baloney Sauce!"

Issue 1 would make permanent the half-cent sales tax approved by voters way back in 2012, and which will last 10 years. How permanent? Included in the state's constitution, which feels like forever to us.

Of the money raised, 70% would go to the Highway Department; 15% to county governments; and 15% to city governments. We're talking $289.9 million in fiscal 2020.

The Legislature, in its wisdom and with the support of Gov. Asa Hutchinson, voted last year to put Issue 1 on the ballot.

Supporters explain that thousands of miles of Arkansas streets and highways would be improved, boatloads of jobs created -- and taxes not raised!

That last part may be said with tongue in cheek.

An argument against Issue 1 is that sales taxes are already too high, are regressive and hurt citizens who don't have a lot of money.

We live on the North Shore, and looked up the sales tax burden in Our Fair City. It's 9.5%: 6.5% state; 1% county; 2% city. So when Papa needs a new pair of shoes and spends $65, the tax burden is $6.18. If the sales tax were 9%, assuming Issue 1 fails, the tax would be $5.85. A pittance difference. But a pittance here and a pittance there, and pretty soon it's real money.

(What really caught our eye was the cumulative sales tax on a mixed drink -- 33.5%! Remind us to fix our next Old-Fashioned at home.)

There it is, folks. On one hand, better highways; on the other, the setting in stone of a regressive tax.

Ain't democracy fun?


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