WEEKLY LEGISLATIVE REPORT – January 16, 2009

Legislative session opens amid concerns over budget

By Sen. Tim Golden

The 2009 session of the Georgia General Assembly got under way Jan. 12 as lawmakers returned to Atlanta knowing that our No. 1 challenge is to balance the new state budget in the toughest economic conditions we have faced in any of our lifetimes.

As secretary of the Senate Appropriations Committee, I will be working with my colleagues Jan. 21-23 on the first steps of the legislative budget process when state agency heads make their formal funding requests during hearings at the State Capitol. We got a preview of those hearings during the first week of the session when Gov. Perdue address a joint legislative session to outline his budget proposals for the remainder of fiscal year 2009 as well as the annual budget for fiscal year 2010.

To address the $2.2 billion revenue shortfall the state is facing this year, the governor made the following proposals:

• A 10 percent cut in spending between now and June 30, reducing the current year’s budget from $21.2 billion to $19.2 billion.
• Elimination of $428 million in tax relief grants to local governments, costing the average homeowner $200 to $300 in additional property taxes.
• No pay increase for educators or other state employees next year.
• Elimination of funding for school nurses and supplements to teachers who receive national board certification.
• A cut of $185.8 million this year and $197 million next year in Quality Basic Education funding for public schools, forcing local systems to cut programs or raise property taxes.
• A new 1.6 percent provider tax on hospitals and HMOs to help fund trauma care and Medicaid reimbursements. I will provide more details on this proposal next week.
• A bond package of $1.2 million in new state borrowing for the construction of new schools, college buildings and other facilities.
• Dipping into the state’s reserve fund, $50 million this year and $408 million next year, taking more than one third of the total available “rainy day” funds.
• A $176 million cut in basic instruction funding for the University System of Georgia.
• Elimination of funding for state golf courses and eight swimming pools at Georgia parks.

In addition to the governor’s proposal, a wide range of legislative measures have been introduced or announced that would increase state revenues: allowing Sunday alcohol sales, eliminating the sales tax exemption for food, legalizing video and/or casino gambling, a tax increase on tobacco products, raising the state sales tax by a penny and even a special tax on the patrons of adult entertainment establishments.

Some of these ideas seem far fetched and will likely never get out of committee, but in dire circumstances like these, everything appears to be on the table. Over the next several weeks, the job of legislative budget writers will be to determine the right priorities for the people of Georgia and the right path to balancing the budget while still providing the core services demanded of state government.

The problem we face is that at the national and state levels, the economic news may very well get worse before it gets better. Georgia Labor Commissioner Michael Thurmond told me last week that his offices are working overtime to handle the shockingly high number of new unemployment cases. Our state has lost hundreds of thousands of jobs the past seven years, and this is a trend we simply must reverse.

Helping Georgia manufacturers create more job opportunities is critical to the future of our state. We made some strides in this area during the 2008 legislative session, but we cannot stop there. As co-chairman of the special Senate Committee on the Future of Manufacturing in Georgia, creating an employment-friendly environment continues to be my top priority. Fixing our state’s economy is the best way to deal with our budget problems now and in the long run.

Thank you for the opportunity to represent you in the state Senate. In addition to the Appropriations Committee, I am also serving on the Finance, Government Oversight, Higher Education and Insurance & Labor committees. I was also re-elected by my colleagues as chairman of the Senate Democratic Caucus.

Throughout the 2009 session, I will keep you informed on the progress of the budget and the other major issues addressed in the Senate. Please contact me whenever I can be of service.