Phoenix Voters Will Consider Transportation Sales Tax in August; Here's Why It Should Pass

The City of Phoenix is looking at a transportation plan for the city that could cost $31 billion. The proposal will go to the voters in an August election. The plan will require tax funding, and legislative efforts have begun to garner support for the tax. Policy analyst Sapna Gupta of the Morrison Institute for Public Policy thinks the measure has a good chance of passage. She discusses the measure in this report.

Sapna Gupta

Sapna Gupta

Gupta says that passage will require the city to sell the voters on the importance of passing the tax and implementing the plan. The city has done a good job so far, and it seems to be getting some help. For example, Banner Health has announced that it will move its headquarters to the midtown area Phoenix, citing the existence of a light rail system as a strong factor in making the decision.

The city’s approach, says Gupta, should be to sell the idea that the improvements will help to attract businesses. The tax would provide financing for street repairs and upgrades, bicycle lane construction, and light rail extension. Residents need to see the attraction of paying the taxes to get the benefits. Another strong point in favor of the transportation improvements is the impact of Gen Xers and Millennials. Research has shown that these groups tend to live closer to a city’s core than its suburbs, and they put a high value on transportation and quality of life issues.

Nationally, there are discussions at many levels on how best to fund transportation construction and maintenance. The federal government and the states use fuel taxes to finance highway construction. Gupta points out that the problem with fuel taxes is that increasing fuel efficiency in automobiles has stopped the growth of tax revenues to keep up with maintenance costs. Planners struggling with other ideas have suggested such things as taxing people based on how many miles they drive. Easy solutions have not yet appeared. The present relatively low fuel prices might make it attractive to raise fuel taxes. However, tax increases are always touchy. In spite of this, the roads need to be repaired, and good infrastructure will be necessary to keep businesses growing.

Gupta notes that there is strong bipartisan support for the Phoenix tax proposal, and the business community is supporting the tax increase. Sound transportation will be essential to attracting high paying jobs and helping businesses to grow. Having access to good transportation will help Phoenix maintain its stature as a great city to live in.

Sapna Gupta is a Senior Policy Analyst at Morrison Institute for Public Policy at Arizona State University in Phoenix. She has a background in policy analysis, research and project management. Previously, she was a consultant and researcher for civic organizations, nonprofits and universities. She has worked as an investment banker in public finance at J.P. Morgan, where she structured financings for public and not-for-profit entities and provided advice on debt management. The Legal Broadcast Network is a featured network of the Sequence Media Group.