This Week in the Georgia Legislature
Considering the governor lowered FY 2012 revenue estimate to 4.25 from 4.5 percent, the FY 2013 revenue estimate is still projected at 5.2 percent growth over the FY 2012 revenue estimate. The omnibus tax bill (HB 386), passed this week, has a projected loss of $49 million revenue in FY 2013. The governor has not adjusted his revenue estimate accordingly. The Georgia State University Economic Forecasting Center’s February quarterly forecast projects FY 2013 revenue growth of only 4.0 percent.
House and Senate Calendar
The House and Senate are scheduled to go into session for the 38th legislative day on Monday March 26, the 39th legislative day on March 27 and the 40th and last legislative day (Sine Die) on Thursday March 29.
State Budget: FY 2013
The Senate passed their version of the FY 2013 budget on Wednesday, March 21 by a vote of 53-0.
Highlights from the Senate budget:
- Reduces $13.1 million in state funds savings ($300,000 greater than House) by assuming that FY 2012 surplus funds will be available to Dept. of Community Health in FY 2013.
- Disagreed with the House and governor on moving funds ($127.7 million) for Pupil Transportation to the Quality Basic Education (QBE) program.
- Disagreed with the House and governor on removing funding for charter system grants; instead, added funds for growth ($2.8 million) and directed that existing base funding be reflected in the QBE program.
- Directed the Department of Education to fund virtual charter schools at the level of $3,200 per FTE (full time equivalent). Funding would be made available in the Amended FY 2013 Amended Budget.
- Authorized the Governor’s Office of Workforce Development to utilize Workforce Investment Act federal funds to create a needs-based grant program in technical schools to train commercial driver’s license applicants and law enforcement applicants.
- Disagreed with the House in creating a separate Georgia Vocational Rehabilitation Agency. Instead programs are transferred from Department of Labor to Human Services as recommended by governor.
- Added $500,000 to Department of Public Health for tuberculosis detection, prevention, and treatment.
- Reduced Board of Regents funding by $2.5 million to recognize savings attributed to proposed campus consolidations.
- Added language that allows lottery-funded higher education low interest loan program to cover HOPE Public Scholarship recipients who had the full scholarship at the start of their college career.
Download FY 2013 Budget Analyses of Governor’s Budget Proposal:
Fiscal and Tax Policy
ALERT! SR 20, The Taxpayer Bill of Rights (TABOR), may come up in Ways and Means committee on Monday and be considered by the House in the final three legislative days. Check out GBPI’s REPORT and FACTSHEET that outlines why Georgia does not need TABOR. SR 20 is flawed legislation that would amend the Georgia State Constitution to limit the growth of state revenues and expenditures to a formula of population plus government inflation growth. Colorado, the only state to implement TABOR, has since suspended it because it contributed to systemic underfunding of education, healthcare, and transportation.
The major news this week was the introduction and rapid passage of an omnibus tax package, HB 386, which moved rapidly through the General Assembly and now awaits signature by Governor Deal. As explained in GBPI’s new analysis and blog statement on the bill, HB 386 falls well short of the comprehensive tax reform proposed by the Special Council on Tax Reform and Fairness for Georgians. Official projections estimate it will cost the state $86 million over the next two budget years, before increasing them by $22 million in year three. Although the fiscal impact in later years is much less clear, certain aspects of the bill – namely the changes to Georgia’s retirement income exclusion and taxation of automobiles – appear likely to increase state revenues long-term, perhaps considerably. Lawmakers will have to return to the table in coming years to take up the more fundamental reform that Georgia still needs.
HB 868 originally contained costly expansions of Georgia’s jobs tax credits, but the House reduced it to a series of technical changes unlikely to affect revenues. Read more: CBS news article. Status: Awaits governor’s signature after passing both chambers.
HB 48 enables counties, via referendum, to cut their inventory taxes (a taxes paid by businesses on their stock of unsold goods) up to 100 percent. A similar measure was vetoed in 2010 by Governor Perdue. Status: Awaits governor’s signature after passing both chambers.
HB 811 was designed to restrict legislators’ ability to divert the revenue collected from special-purpose fees (e.g. hazardous waste, police training), was approved by the Senate on Thursday after undergoing significant revisions from the original House version. Although the basics of the bill are still intact, the new version contains provisions that will greatly weaken the actual force of the law (read more: http://www.ajc.com/news/georgia-government/senate-waters-down-bill-1383759.html). Status: The House will now have to either agree to the changes or appoint a conference committee.
HB 920 a vital piece of reform designed to maximize the effectiveness of tax-side spending, was held in the House Rules Committee before Crossover Day. Lawmakers should reconsider the vital piece of reform next year. Status: Dead for this legislative session.
HB 1027 closes some loopholes in Georgia’s film tax credits and makes some small changes in eligibility that will bring in an estimated $11 million in revenue over the next three fiscal years. Status: In the Senate Finance Committee.
HB 318 and HB 334 revive two small sales tax exemptions designed to aid in hunger relief. HB 318 exempts food that restaurants or grocery stores donate to qualified nonprofits, while HB 338 exempts food that is purchased by Georgia food banks. Status: Both are in the Senate Finance Committee.
HB 743 extends the exemption from motor fuel taxes currently enjoyed by public transit and campus vehicles, which has been in existence since 1978. Extending the exemption will cost around $3 million per year. Status: In the Senate Finance Committee.
SB 402 would reform Georgia’s pension system to allow the state’s Employees Retirement Fund to invest in various “alternative investments,” such as venture capital. A maximum of five percent of pension assets could be invested in alternatives, and teacher pensions would be excluded from the reform altogether. Status: Currently in the House Rules Committee after passing the Senate.
HB 1166 requires health insurers operating in Georgia’s individual health insurance market to offer policies for child-only coverage. The bill also sets up rules for how these policies should be offered and notably establishes an “open enrollment” period of January 1 – 31, 2013 for families to sign up for coverage. Currently, none of the health insurers offering coverage through the individual market offer child-only plans. Status: The bill is on Senate Rules Calendar for Monday, March 26.
Friday, March 23 Marks 2nd Anniversary of Affordable Care Act
Today, thousands of Georgians benefit from the federal healthcare law. With the Affordable Care Act, nearly 1,500 Georgians now have coverage through the Pre-Existing Conditions Plan and approximately 85,000 young Georgians have coverage under their parents’ health insurance. On Monday, GBPI will release a report that will highlight several ways Georgia benefits from the ACA and provide an overview of many of the health care programs.
HR 1162 (LC 33 4555s) proposes amendment to state constitution that clarifies state’s authority regarding K-12 education. The substitute version of original House Resolution 1162 (HR 1162 LC 33 4555S) proposes an amendment to Georgia’s state constitution. The amendment would explicitly state the General Assembly’s role in establishing state-wide education policies for public education. The amendment would also restate the state’s authority to establish special schools – which would include charter schools – in response to the ruling by Georgia’s Supreme Court in 2011 that the now-defunct Georgia Charter Schools Commission is unconstitutional. If HR 1162 passes both the House and Senate, the amendment would be presented to the citizens of Georgia, who would vote for or against the measure. Status: House passed on Feb. 8. Senate favorably passed resolution on March 19. Voters will vote on proposed amendment to state constitution in November 2012.
HB 760 makes several changes to the K-12 education Capital Outlay Program. Currently, the program consists of four sub-programs: Exceptional Growth Program, Regular Program, Advanced Funding Program, and Low-Wealth Program. Status: Bill has been sent to governor for final signature.
HB 797 is the enabling legislation for House Resolution 1162, which proposes amending the state constitution to allow for the creation of a state charter school commission. HB 797 articulates the authorities and responsibilities of the proposed state charter school commission – which would consist of seven appointment members – as well as the mechanism for funding authorized state charter schools. Status: The House favorably passed bill on March 7. The bill is now on Senate Rules calendar and can be brought up for consideration anytime.
HB 824: makes changes to the state’s equalization grants program funding formula. The bill attempts to ensure that equalization funding is effectively directed to low-wealth school systems across Georgia. The house favorably passed the bill, which will now move to the Senate for consideration. For additional information, download the HB 824 Fact Sheet. Status: House favorably passed bill on February 17 2012. Bill is now on Senate Rules calendar and can be brought up for consideration anytime.
Human Services Policy
Drug Testing of Applicants for Public Assistance (TANF, Medicaid and UI)
Several bills have been introduced that require drug testing (mandatory or random) of adult applicants or recipients of Temporary Assistance for Needy Families, Medicaid, State Unemployment Insurance, and possibly other “state or state-administered federal public assistance”. The bills generally require the applicant or recipient to pay for the cost of the drug test, which is reimbursed if the test result is negative, using federal funds. These bills may not be constitutional (e.g., if considered suspicion-less searches) or may not be allowable under current federal law that governs public assistance (e.g., current unemployment law does not allow drug testing).
SB 292 requires drug tests for approved TANF applicants and Medicaid applicants. The substitute allows for a cotton swab test, only tests one parent, and does not delay benefits. In addition, the substitute states that “No testing shall be required… for any person who the department (DCH) determines is significantly hindered, because of a physical or mental handicap or developmental disability, from doing so. Status: The Senate Health & Human Services Subcommittee for Health Care Delivery passed a substitute to SB292 (by a 2-1 vote) on Wednesday, Feb. 15. The Senate Health & Human Services Committee passed SB 292 on Monday, Feb. 27. The Senate passed SB 292 on March 7. The House Judiciary Committee passed a substitute to SB 292 on March 21 that converts the bill to the version of HB 861 that passed the House with exemptions for applicants in long-term care and victims of domestic violence who live in shelters. The substitute bill also included a clarifying amendment related to random drug testing. The bill now goes to the House floor for consideration.
HB 861, includes drug testing of TANF applicants, random drug testing of TANF recipients, and drug testing of TANF recipients who have been arrested for drug-related offenses. The bill language states that the Department of Human Services “shall establish a procedure by which law enforcement agencies may report arrests for drug related offenses.” The bill appears to charge TANF recipients who pass their drug test with the costs of administering the test. Status: The Lane Subcommittee Judiciary Civil passed HB 861 on February 21. The House Judiciary Committee passed an amended HB 861 that removed the law enforcement reporting language and added an effective date of July 1, 2013. HB 861, as amended, passed the House on March 7. Senate Health & Human Services Committee passed a substitute to HB 861 on March 21 that converts the bill to the version of SB 292 as it passed the Senate. The bill now goes to Senate floor for consideration.
SB 312 requires food stamp applicants to “engage in professional development activities,” such as “working toward a general education development (GED) diploma, if not a high school graduate, pursuing technical education; attending self-development classes; and enrolling in an adult literacy class.” The substitute bill includes exemptions for those who are:
- Under age 16 or over age 59,
- Developmentally disabled,
- Caretakers with a child under age 6 or for an incapacitated adult,
- Working at least 30 hours a week,
- Participants in drug/alcohol rehabilitation program,
- Students who are at least part-time, or
- Unemployed insurance benefit recipients.
SB 312 would be piloted in five counties (to be decided by the Department of Human Services) and the bill’s effective date is contingent upon appropriations the DHS. No fiscal note has been made available on the substitute bill. Status: The Senate Health & Human Services Committee passed SB 312 on Wednesday, Feb 29. The substitute bill passed on the Senate on March 7. The House Judiciary Committee passed SB 312 with an amendment to raise the age of child to 16 for parent to be exempt. The bill now goes to the House floor for consideration.
Proposed Transfer of Rehabilitation Services
HB 1146 proposes moving the Division of Rehabilitation Services from the Department of Labor to a newly created agency (Georgia Vocational Rehabilitation Agency) that would be attached to the Department of Human Services, effective July 1, 2012. The agency would be assigned to DHS for administrative purposes only. The bill also creates a Georgia Vocational Rehabilitation Services Board, appointed by the governor, consisting of nine members with vocational rehabilitation experience including five members who either have disabilities or have family members with disabilities. The executive director of the new agency would be nominated by the governor and approved by the Board. Status: Passed the House. Senate passed on March 20. The bill now goes to the governor for signature.
Proposed Cuts to Unemployment Benefits
SB 447 makes drastic cuts to unemployment benefits and makes small changes to the funding of the Georgia unemployment trust fund.
For the unemployed, who lost their jobs through no fault of their own, SB 447 would:
- Impose a waiting week to delay payment of the first week unemployment compensation (which would eliminate a week of unemployment benefits for half of unemployment benefit recipients),
- Reduce the maximum number of weeks of unemployment benefits from 26 weeks to a sliding scale of 12 to 20 weeks, which is less than any other state in the country,
- Continue to suppress the increased tax rate that would be in place, keeping the surcharge at 50 percent until the $757 million federal loan is repaid and there is a $1 Billion balance in the Trust Fund, and
- Raise the taxable wage base from $8,500 to $9,500 in 2013.
Status: The bill passed the Senate on Friday, Feb. 24. On March 19, the House Industrial Relations Committee held a hearing on SB 447. No vote was taken.
For additional information download the SB 477 Fact Sheet.