Atlanta officials already agreed a couple of weeks ago to throw $142.5 million in car-rental taxes at a renovation of the Hawks arena, but now it’s official, as the Atlanta city council has given its blessing to the deal:
The Council on Monday approved a deal between the city and College Park to extend car rental tax collections beyond their 2038 sunset to raise at least $110 million to fund a $192.5 million update of Philips, the city’s downtown Atlanta sports and entertainment complex.
Now the city and College Park will collect the tax through 2047. College Park was required to sign off on the deal because it is home to the car rental facilities at Hartsfield-Jackson International Airport, the source of the revenue.
So basically, instead of the car rental tax surcharge ending in 2038, or being available to be used for something else, it will go to repay the $110 million in bonds that will be a-moldering on the city’s books by then. (The Hawks will get another $32.5 million in cash from the city from other sources.)
Anyway, that’s that. The best part of this story comes at the end, where apparently Mayor Kasim Reed got into an argument with a college student, if I’m reading this Atlanta Journal-Constitution article correctly:
Georgia State University student Tim Franzen said he didn’t understand the city’s love of stadiums.
“It’s insane,” he said. “We are not in a crisis of resources. We are in a crisis of moral authority.”
An exasperated Reed pushed back, saying he was tired of the council and his administration being beat up for what he sees as a record of accomplishment, including cutting the unemployment rate in half and millions in investment in the city.
“You are not going to come in here and question our hearts,” he said.
Great moments in democracy, people. I so hope there’s a YouTube clip.
Taxes like this are the ultimate in taxation without representation. It’s absolute bullshit that these taxes are passed on to non residents of a community. Furthermore, all of these excessive municipal taxes on visitors could be flowing directly to local small businesses rather than these deep pocketed franchises who really don’t need the subsidies.
So is interest just accruing for 20 years, only then does revenue from the rental car taxes kick in to be put toward the $142.5M?
And yes, taxation without representation is annoying but it’s not illegal. Have a vague recollection of seeing that somewhere (and can’t for the life of me find it online anywhere now) that around 25% of all rentals are actually from locals, so it’s not entirely a screw job for visitors, but yeah, in some cities your taxes can be more than your base rate. I’ve had it happen to me in Seattle and Houston.
These taxes are based on airport rentals only, so unless the locals get out to the airport to get their rental, they don’t pay them. I used to travel extensively & rent cars for personal, but with taxes (city, county, state sales, airport recovery, air cond tax, licensing tax, loyalty tax, & more) being more than 50% of the cost, it’s no longer worth it. In Denver I rented a vehicle for a week at $100 but the taxes & fees (stadiums & convention centres) plus the other taxes put my total cost at over $220.
That might be the case in Atlanta (and I’m taking your word for it I just haven’t looked at the details of this particular agreement). But—and this is a data point of one—I gave up my car so I rent locally maybe once a month (run all my big errands) and I always do it at the airport because, even with additional taxes, the base rates are substantially lower than renting in town so I come out ahead. So yes, sometimes locals do rent at the airport (although, sure, probably at a much lower percentage).
Also, not all rental-car tax stadium screwjobs are only airport based. A piece of the Arlington Rangers’ deal is a tax on rental cars and I doubt people flying into DFW hitch a ride to Arlington to then rent a car. So that’s probably mostly locals.
I don’t think the city council cut the employment rate in half. I would credit the recovery from the banking crisis and the natural rise and fall of the business cycle for that.
“You are not going to come in here and question our hearts,”…
Oh, good, yet another pol whining about how unfair the world is being to him. Yo, dude, having your heart questioned is a perfectly valid thing to have happen in a public forum.
And gotta wonder how College Park ended up with some kind of veto right on how taxes generated at the airport get spent. (I’m assuming the city didn’t build a $bazillion airport on their own dime.)
The car rental facility is built within the City of College Park and paid for by the City of Atlanta.