Georgia Budget & Policy Institute
This Week in the Georgia Legislature
engraved GA
State Revenues  
 
State revenues for the first six months of this fiscal year are running 13.7 percent behind FY 2009 revenue collections. 
 
The governor's FY 2010 revised revenue estimate projects a decline in revenues of 8.9 percent. Revenues will need to increase by 1.4 percent over the remaining six months of the fiscal year in order to meet this estimate. 
 
The governor's FY 2011 revenue estimate, which includes new taxes and fees, is an increase of 8.1 percent compared to FY 2010 projected collections. Without adding in his new revenue proposals, the governor's FY 2011 revenue estimate projects a 3.9 percent increase. 
House and Senate Calendar 
This week, the House and Senate are scheduled to go into session for the 14th legislative day on Monday February 8th and remain in session through the 17th legislative day on Thursday, February 11th.   
State Budget: FY 2010 Amended and FY 2011
 
Process
 
The governor released his proposed budgets on January 15, 2010. The House and Senate held joint Appropriations Committee Hearings to hear from the governor and agency heads January 19th through 21st. Both the House and Senate Appropriations subcommittees have continued their budget hearings on the Amended FY 2010 budget. It is expected that the full House Appropriations Committee will take up the Amended FY 2010 budget next week.
 
Fiscal and Tax Policy 
 
Transparency for Tax Breaks 
 
Senate Bill 206, which would require an accounting of tax breaks currently in the tax system, remained in the House Appropriations Committee this week. The bill passed the Senate unanimously last year. Read information on the topic here. 
 
Legislators Introduce a Tax Cut Package  
 
On Monday, legislators introduced House Bill 1023, almost identical legislation to the so-called JOBS Act the governor vetoed last session. Rather than going to the House Ways and Means Committee, as is typical for tax bills, it was assigned to the Special Committee on Small Business Development and Job Creation.
 
The bill would provide a tax credit for hiring unemployed workers, give a holiday for business filing fees, eliminate the corporate net worth tax, create a $10 million angel investor tax credit, and reduce the tax on capital gains 50 percent, among other cuts.
 
The main changes are the angel investor tax credit and a trigger mechanism for the capital gains tax cut (the rainy day funds would have to return to $500 million for the cut to take place). Read the Institute's analysis of the cost of these cuts and how they would add to the deficit (analysis is of last year's bill). 
 
Additional legislation was introduced with individual components of the tax cut package, such as HB 998, which would repeal the corporate net worth tax. These bills were assigned to the House Ways and Means Committee.
 
Proposed Bills Would Raise Revenue or Improve Fairness 
 
Several bills were introduced and started through the first stages of the committee process this week, including:
  • HB 928/HR 1109 removes the sales tax exemption from lottery tickets and dedicates the new revenues to K-12 education.
  • HB 1066 adds a temporary one percent surcharge on income over $400,000.
  • HBs 1065, 1067, and 1068 would temporarily reduce the value of tax credits by 15 percent.
  • HBs 982, 983, and 986, among others, improve tax collections through electronic data management and also close a tax loophole.
 
Additionally, HB 39, which would raise the cigarette tax by $1, remains active from last session.
 
February 5, 2010
Alan's Signature
Annual Policy Conference Provides Solutions to State Budget Turmoil
 
By Bruce Borowsky and Sanchita Sarkar
 
For more info and reports, please visit:
 
GBPI in the News
 
 Alternatives to Budget Cuts
 

Georgia Should Raise its Taxes to Close the Budget Shortfall and Modernize the State  Commentary by Alan Essig, Exec. Dir., published in the AJC  

Georgia, Oregon Become Economic Test Case 
Atlanta Journal Constitution
  
 
Stimulus Package Puts Nearly $10 million in Floyd Pockets 
Rome News-Tribune
 
 
 Georgia Faces $4.6 Billion Deficit
Session 2010 Info:
 
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The Georgia Budget and Policy Institute, the state's leading independent, nonprofit, non-partisan organization, seeks to build a more prosperous Georgia. We rigorously analyze budget and tax policies and provide education to inspire informed debate and responsible decision-making, advancing our vision of a state in which economic opportunity and well-being are widely shared among all.