Georgia’s $1.8B Highway Plan: What State Infrastructure Spending Means for Local Taxes and Property Owners

Hook: Why Georgia’s $1.8B I‑75 Plan Matters to Your Wallet — Now

If you own a home in the Atlanta suburbs, invest in local rental real estate, or hold municipal bonds, Georgia’s newly proposed $1.8 billion plan to unclog I‑75 is more than a transportation story — it’s a tax and valuation story. Homeowners worry about rising property tax bills after improvements. Investors worry about shifting risk in municipal bond deals and the broader SALT (state and local tax) picture. This article breaks down how big highway projects are typically paid for, what that means for property assessments and local taxes in 2026, and the specific actions homeowners and investors should take to protect cash flow and returns.

The Plan in Brief (Context for 2026)

In January 2026, Georgia’s governor proposed spending roughly $1.8 billion to add toll express lanes along a congested segment of Interstate 75 through Henry and Clayton counties — the same corridor that already has reversible express lanes in parts. The proposal emphasizes adding an extra toll lane in each direction to improve throughput and support regional economic growth. The state has already been expanding toll lanes and rebuilding interchanges around the I‑285 perimeter, and this new initiative follows a national trend of highway expansion combined with user fees and public/private financing.

"When it comes to traffic congestion, we can’t let our competitors have the upper hand." — Governor (statement on the I‑75 initiative, Jan 2026)

How Big Highway Projects Are Funded: The Main Mechanisms

There are four common financing routes for state highway projects. Each one has different implications for taxpayers, property owners, and investors:

1) Toll‑backed Revenue Bonds

How they work: The state or a transportation authority issues bonds whose debt service is paid from toll revenue. If traffic — and toll revenue — meets projections, the bonds service remains steady. If traffic falls short, bondholders bear the risk.

What it means for you: Because these are not directly backed by property tax receipts, they typically do not trigger immediate local tax increases. But they can influence toll rates, and tolls change commuting costs and property desirability. Revenue bonds tend to offer higher yields than general obligation (GO) bonds because they carry greater risk tied to traffic volumes and covenant strength.

2) General Obligation (GO) Bonds

How they work: Issued by the state or a local government and backed by the issuer’s taxing power (usually property taxes and/or general fund revenue). GO bonds typically require voter approval and are viewed as lower risk for investors.

What it means for you: If a project is financed with GO bonds, homeowners and property investors may face higher property tax millage rates if local governments increase levies to cover debt service — particularly if the issuance was authorized without a dedicated revenue stream. GO-backed funding is more likely to trigger political debates about tax increases or spending tradeoffs.

3) Sales Tax and Local Option Levies (e.g., TSPLOST in Georgia)

How they work: States and counties sometimes fund transportation projects with dedicated sales taxes or special-purpose local option sales taxes. In Georgia, the Transportation Special Purpose Local Option Sales Tax (TSPLOST) is a well‑established mechanism to fund local and regional transport projects; these measures typically require voter approval.

What it means for you: Sales tax financing spreads the burden across all consumers — including visitors — and is less directly tied to property tax bills. However, higher sales taxes can have regressive impacts and may affect retail activity near improved corridors.

4) Public‑Private Partnerships (P3s) and Concessions

How they work: Private firms design, build, finance, and sometimes operate toll lanes in exchange for long-term concessions on toll revenue or availability payments from the government.

What it means for you: P3s can shift construction and operational risk to private partners and reduce up‑front public borrowing. However, concession agreements may lock in toll schedules and lane access terms and can include non‑compete clauses that affect local-level planning. Financial returns and long-term user charges are negotiated, so transparency is critical.

Why Funding Choice Matters for Property Taxes and SALT

Which funding tool a state or county chooses will determine who pays, how quickly, and through which tax channels:

• GO bond funding is the most likely to result in higher property taxes if local governments raise millage rates to cover debt service.
• Toll revenue bonds shift costs to drivers but may indirectly raise local property values — and future assessments — if the project spurs development.
• Sales taxes and TSPLOST hit consumers at the point of purchase and are less visible on property tax bills but still affect residents and businesses.
• P3s can limit public borrowing but may also fix tolls and long-term fee structures that affect commuting costs and investment attractiveness.

Property Reassessments: The Hidden Tax Risk for Homeowners and Investors

Infrastructure upgrades are a classic driver of property reassessments because improved accessibility typically increases land values. Here’s what to watch for:

How reassessments typically occur

1. County tax assessors periodically revalue properties (annually or on a set schedule — check your county’s cycle).
2. Major public improvements or new interchanges can prompt interim market‑value adjustments before the next scheduled revaluation.
3. Assessed value multiplied by the local millage rate equals the property tax bill. If assessed value rises and the millage rate remains unchanged, your bill rises.

Key homeowner and investor risks

• Higher assessed values: Even if rates fall, rapidly rising assessments can outpace any rate decreases.
• Changed millage rates: Local governments may increase rates to pay for GO bond debt service or to fund complementary services (police, schools, stormwater) that grow with development.
• Special assessments or improvement districts: Localities may create special taxing districts that levy additional property taxes for a project’s debt service or maintenance.
• Timing mismatch: Construction may take years, but reassessments or new levies can accelerate once plans are public or when development follows road improvements.

SALT (State and Local Tax Deduction) Considerations in 2026

The federal SALT deduction cap — which limits deductible state and local taxes to $10,000 at the federal level — remains an important constraint for many taxpayers as of 2026. Here are practical implications and strategies:

Immediate impacts

• Homeowners in higher‑tax pockets of Georgia might hit the SALT cap more quickly after reassessments that raise property taxes.
• Investors and owner‑occupied rental businesses with pass‑through taxable income may seek entity‑level planning to maximize federal deductibility.

State workarounds and 2026 trends

Several states have pursued elective pass‑through entity (PTE) taxes or other structures that allow entity‑level deduction of state taxes, effectively sidestepping the SALT cap at the federal level for many business owners. By 2026, this workaround is a standard part of state fiscal toolkits, and Georgia — like other states — has monitored or implemented elective entity‑level tax options in recent years. If you are a small‑business owner or investor, verify whether your entity is eligible and whether the state has amended rules for 2026; the net benefit depends on your taxable income profile and federal tax brackets.

Municipal Bonds: What Investors Should Watch

Municipal bond investors need to treat an $1.8B toll‑and‑highway plan as a credit story. Key considerations:

Revenue vs. GO bonds

Revenue bonds (toll‑backed) depend on traffic and toll collections; stress‑test traffic volume, elasticity, and competition (alternate routes or transit). GO bonds are usually safer but expose issuers to voter backlash if taxes rise.

Credit metrics and covenants

• Debt service coverage ratios (DSCRs) for revenue pledges.
• Maintenance reserve requirements and replacement funds.
• Non‑compete clauses (which can prevent governments from building competing free lanes) and how they are enforced.
• Covenant strength on toll rate setting and senior liens.

Market context (2025–2026)

Through late 2025 and into 2026, many municipal issuers navigated higher interest‑rate regimes and more cautious demand relative to earlier decade lows, making careful structuring important. For individual investors, laddering maturities, evaluating tax‑equivalent yields considering your federal tax bracket, and preferring highly rated GO bonds for core allocations remain prudent strategies.

Actionable Checklist: What Homeowners Should Do Today

1. Monitor public notices. County assessor and board of commissioners agendas often announce planned projects, TSPLOST referenda, or bond authorizations.
2. Estimate assessment impact. Use recent sales of similarly improved areas (comps) to gauge potential upward valuation pressure on your property.
3. Check exemptions. Apply for or verify homestead and senior exemptions, circuit breaker programs, or disabled veteran credits that reduce taxable value.
4. Prepare to appeal. If you receive a higher valuation, gather comps, photographs, and income/expense docs (for investment property) and file an appeal promptly — appeal windows are short.
5. Budget for higher carrying costs. Build potential tax increases into mortgage or investment yield stress tests for the next 3–5 years.

Actionable Checklist: What Real Estate and Municipal Bond Investors Should Do

1. Stress‑test cash flows. For rental properties, recalc net operating income (NOI) with a range of increased property tax scenarios and potential toll‑driven demand shifts.
2. Review bond docs. If buying toll‑revenue bonds, read offering statements, traffic studies, DSCR covenants, and non‑compete terms.
3. Consider tax strategies. Evaluate whether entity‑level tax elections or state PTE structures fit your ownership plan in 2026.
4. Watch local referenda. Sales tax or bond measures that fund transportation can materially change the financing mix; vote and lobby through trade groups if outcomes affect your holdings.
5. Consult advisors early. Talk to a CPA experienced in SALT planning and a property‑tax attorney if reassessments or special districts are likely.

Three Advanced Strategies (For Sophisticated Investors)

• Buy the credit, not the headline: Analyze issuer credit fundamentals — not just project size. Heavy reliance on variable toll revenue requires conservative underwriting.
• Use tax‑equivalent yield calculations: For high‑income taxpayers constrained by the SALT cap, municipal bonds’ tax advantages can still make sense when comparing after‑tax yield to taxable options.
• Negotiate PILOT or TIF offsets: Large developers sometimes negotiate Payments In Lieu Of Taxes (PILOTs) or Tax Increment Financing (TIF) that change the property‑tax trajectory of a district — factor these into long‑term valuation models.

What to Watch in Georgia Specifically (2026 Signals)

Key local indicators that will show how much of the $1.8B burden falls on homeowners or drivers:

• Will the state issue toll‑revenue bonds or pursue a P3 concession? Toll revenue means direct user charges rather than property taxes.
• Will counties push a TSPLOST or other local sales tax referendum? That would spread costs to consumers and could avoid property tax hikes.
• Are GO bond referenda on the ballot? Voter authorization of GO debt would be a signal that property owner tax bills could rise if local governments choose higher millage to meet obligations.
• County assessor reassessment schedules and provisional revaluations after project approval — check Henry and Clayton county assessor websites for notices.

Final Takeaways — What to Do in the Next 90 Days

1. Sign up for county assessor and commissioner alerts in Henry and Clayton counties.
2. Run a 3‑scenario cash‑flow model for your property or muni bond portfolio: (a) no change; (b) moderate reassessment + tolls; (c) high reassessment + millage increases.
3. Contact your CPA about SALT workarounds and whether an entity‑level election makes sense for 2026.
4. If you own muni bonds or plan to buy, read the official statement and traffic studies for toll projects before investing.
5. If you are an owner‑occupant in the corridor, confirm your homestead exemption and eligible credits.

Why This Matters Beyond Georgia

The Georgia I‑75 plan illustrates broader 2026 trends: more states are combining tolling, P3s, and targeted sales taxes to finance major transportation upgrades. That financing mix shifts tax burdens in different ways — some to drivers, some to consumers, and some directly to property owners. For taxpayers and investors, the takeaways are universal: monitor local funding choices, prepare for reassessments, and use tax planning tools to limit unexpected hits to cash flow.

Call to Action

Don’t wait for the tax bill to arrive. Start by signing up for assessor and commission alerts in your county, run a 3‑scenario tax & cash‑flow model for your properties, and book a short consult with a CPA who specializes in SALT strategies and municipal bond credits. If you want a practical worksheet we use with clients to estimate reassessment impacts and SALT exposure, request it through our newsletter or contact our advisory desk for a tailored review.

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