Soon after the traditional paper storm settled on the 2016 legislative session Gov. Nathan Deal’s swift veto of the so-called religious liberty bill grabbed the headlines. It’s understandable if you lost track of the fate of other important legislation at the end of the whirlwind 2016 session. While social issues seemed to dominate this year’s big debates, GBPI kept careful watch on the progress of less-heralded legislation, both promising and worrisome.
Perhaps the most worrisome proposals of all threatened major budget-busting income tax cuts, allowed to die in the House after senators stuck representatives with the job. Given that 2016 is an election year, halting this reckless legislation is a significant feat. It provides encouraging evidence Georgia’s leaders embrace the importance of maintaining a stable budget that allows future lawmakers to invest in priorities key to thriving communities that include education, health care, transportation and more.
Proposals to upend Georgia’s tax system will probably return in 2017. Our team remains committed to showing ways to improve Georgia’s revenue structure and help hard-working Georgians. We’ll continue to stress how critical it is that Georgia maintains the ability to meet the demands of a growing state, in part by building its rainy day fund and protecting its top-notch credit rating.
Scuttling bad legislation is worth noting, but we’re also happy to give credit where it’s due. Georgia’s legislative leaders made progress on a criminal justice reform package that eliminates a food stamp ban for former drug-offenders who serve their time and follow the rules once they leave prison. Two-thirds of the 10,000 people who might be affected every year have children. The change promises a boost of about $17 million to Georgia’s economy, while helping people make a more successful transition post-incarceration.
From the good news, bad news department, legislators engaged in a conversation about the shortcomings of Georgia’s health care system and ways to fix it. An obvious solution is to close Georgia’s coverage gap through the federal health law and extend insurance to up to 500,000 Georgians. Instead lawmakers settled for a tax credit to encourage individuals or corporations to contribute to rural hospitals. The plan got better as lawmakers fixed some of the original bill’s flaws. Still, the version sent to the governor’s desk proposes an inefficient use of tax breaks to subtract money from the state treasury and falls far short of what’s needed to increase patients’ access to care in rural communities. It also offers next to nothing for people who need medical treatment in Georgia’s cities and suburban communities.
You may have heard Georgia’s 2017 budget that begins in July is the state’s largest ever. Sometimes that news omitted the context that the state’s growing population and recovery from its lingering recession hangover explain the record budget. Still, Georgia’s investment in education and health care and other measures of quality of life ranks among the lowest of all states. Factor in Georgia’s inflation and population growth the last decade and Georgia’s 2017 spending plan really just gets Georgia back to pre-recession levels. That includes the new transportation-related investment passed in the 2015 session that accounts for nearly $1 billion of the $23.7 overall budget.
The final budget the Legislature sent for the governor’s final review hews closely to the versions passed by each individual chamber. The governor can approve it as is, or veto items at his discretion. You can count on GBPI to publish our annual in-depth analysis of the budget in July, a primer to provide more details of the signed budget.
The budget at this writing adds $300 million to continue efforts to eliminate the education austerity reduction, though the 2017 budget still cuts about $167 million from the school funding formula and also underfunds school transportation and sparsity grants.
The budget also directs nearly $34 million to raise payment rates for health care providers serving Medicaid patients and adds $86 million to boost a variety of programs in the Department of Human Services.
In sum, lawmakers resisted the temptation to create long-term financial risk to the state by upending our tax system. Still, missed opportunities to better shore up education and health care funding are also the legacy of the 2016 General Assembly.