END OF SESSION REPORT – From GA Farm Bureau
(5/5/10)Difficult economic times have forced state government to tighten its belt. This session was one of the longest in history because legislators had to make tough decisions that required careful thought and research. While budget matters overshadowed the legislative session, the General Assembly also passed water legislation, a landmark transportation funding bill, legislation to evaluate Georgia’s tax structure, and other important legislation.
This year’s budget was especially difficult for legislators because of mid-year revisions in revenue estimates that were even lower than original estimates, and Georgia is constitutionally mandated to develop a balanced budget. Georgia’s revenue has shrunk from $22 billion a couple years ago to this year’s $17.8 billion. Therefore, lawmakers had to choose between the ugly choices of tax increases and cuts in services. The final budget passed in the evening hours of Day 40.Overall, agriculture fared well considering the budgetary situation. A few points from the final budget include:
- 10% cut to Cooperative Extension & 4-H
- 10% cut to Experiment Stations
- 9% cut to the Vocational Ag Education and Career Tech Education
- Elimination of funding for the Farmer’s and Consumer’s Market Bulletin. However, legislation was adopted allowing for subscription fees, donations, or other funds from the Department of Agriculture to be used to continue its publication if deemed appropriate.
- Full funding for the Vidalia Onion Research Project
- $10.5 million in funding for Forest Land Protection Grants. This constitutionally mandated funding helps to offset the loss in local revenue as a result of Forest Land Protection Act covenants.
Georgia Tax Study
Trying economic times sparked interest from legislators across the state to study and evaluate Georgia’s tax code. In response, House and Senate leadership authored HB 1405, a measure that creates a special council of qualified citizens who will evaluate sales tax exemptions and make recommendations to a newly-created committee of House and Senate leaders. The bill creates a “Council on Tax Reform and Fairness” and a “Special Joint Committee on Georgia Revenue Structure.” The Council consists of four economists, Governor Sonny Perdue, the 2010 chairperson of the Georgia Chamber of Commerce, the 2010 Georgia chairperson of the National Federation of Independent Business, two members appointed by the Lieutenant Governor and two members appointed by the Speaker of the House. They will meet over the summer and make recommendations by next January to the Lieutenant Governor and House
Speaker. If deemed appropriate, the “Special Joint Committee on Georgia Revenue Structure” will bring legislation to the floor of the House and then the Senate for an up or down vote without opportunity for amendment.
HB 1405 could have far-reaching consequences. Key leaders have made it plain that all issues are under consideration with respect to revenue generation and structure. Georgia Farm Bureau members must be ready to offer legislative input to their elected officials in the coming months as this process continues. It is vital to communicate the importance of farm input sales tax exemptions to legislators. For many farmers, the difference between farming and selling out could be the sales tax exemptions on feed, seed, chemicals, fertilizer, equipment, and other inputs.
