Revenue estimate makes budget work tough
HOUSE OF REPRESENTATIVES
By REP. MICKEY CHANNELL Georgia District 116

With Spring here, tax cuts continue to be a topic of discussion in the Capitol halls. This week, the House and the Senate finally reached an agreement on the Fiscal Year 2008 Amended Budget and we also completed our work on the Fiscal Year 2009 Budget. I am happy to report that we were able to restore equalization grants and the majority of the austerity cuts to education.

Our work on the state budgets this year has been difficult due to a decreased revenue estimate. We found ourselves in a position of having to make some difficultcuts while still funding our state's priorities, especially in education. Nationally, Georgia ranks 49th in per capita spending but ninth in overall education spending. I believe this is evidence of our continued commitment to fiscally conservative policies while funding our educational needs. I can tell you that my colleagues on the House Appropriations Committee worked tirelessly on these two budgets and I am proud to report to you that we have succeeded in funding our priorities.

In the FY08 Amended Budget, the original House proposal included $30 million in equalization grants for Georgia's school systems. Our final agreement did include $20 million for those grants and we have funded the additional $10 million in the FY09 budget. We also funded over $50 million for trauma care to help hospitals like Grady in Atlanta that treat the critically injured, $2.7 million to the public defender program to ensure all Georgians receive fair legal representation regardless of their ability to pay, and $40 million for reservoir projects to meet Georgia's future water needs. This midyear budget also included $210 million in bonds for school construction projects around the state. This budget was adopted by both the House and the Senate last week and signed by the Governor last Friday.

Earlier this session, I laid out for you the priorities of the House as we moved through the budget process. We have remained committed to funding education, healthcare, public safety and natural resources despite a $245 million cut in es- timated revenue. Our top priority was to restore the $141 million in austerity cuts to education and after many weeks with long nights, we did restore $90 million of those cuts. We also funded a 2.5 percent pay raise for our teachers and state employees, a pay raise for our public safety officersincluding those under the Department of Natural Resources, community health centers, and of course that final $10 million in equalization grants for our schools. As Chairman of the Health Sub-Committee, I am pleased that this budget contains over $200 million in badly needed and long overdue medical rate increases. Our hospitals and doctors still provide medical care to Medicaid patients at less than their cost but this is a step in the right direction. This budget was immediately transmitted to the Senate for consideration.

Both of these budgets are fiscally conservative and meet the needs of our citizens. The Governor must act within six days on the FY08 Amended Budget, and I hope the Senate also moves quickly on the FY09 Budget and mirrors the House's commitment to restoring austerity cuts.

You may recall that last week the House adopted House Resolution 1246 that would allow Georgians to vote to eliminate the 'birthday tax' on personal vehicles over a two year period, eliminate the state's portion of the ad valorem taxes on personal vehicles and property, and cap assessments on personal property at 2% per year and commercial property at 3% per year. Tied to this was a measure that would have provided for a $10 fee on every vehicle registered in Georgia to fund a statewide trauma care network. This tax cut would have saved Georgians over $750 million making it the largest in our history. More importantly, this tax cut would have permanently and completely eliminated a tax on our citizens.

This week in a Senate committee, they stripped from the bill the provision that eliminates the birthday tax leaving Georgians to continue to bear this burden every year. The Senate has offered a different tax cut but it is not permanent and it does not completely eliminate any tax burden on Georgians. The Senate has announced its intention to introduce a measure to reduce the income tax Georgians pay but the Senate's plan offers only a partial reduction and does not make that reduction permanent. While I do believe that we need to further explore this idea, the House has spent more than a year holding hearings and meeting with Georgians on this issue of tax cuts. And what we heard loud and clear was that Georgians no longer want to pay a tax on their birthday. I hope that over the next legislative recess we can hold hearings on reducing or eliminating the income tax, but for now we need the complete and permanent elimination of the birthday tax.

I will continue to keep you up to date on our actions as the legislative session progresses. Should you have any questions or concerns, please do not hesitate to contact me at my Capitol office. I look forward to hearing from you soon.

(Representative Mickey Channell represents Greene, Putnam, Oglethorpe and Wilkes counties. During the Session he may be contacted at: 401 State Capitol; Atlanta, GA 30334. Office:404-656-7855.

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