As we near the 2011 Session of the General Assembly, discussion topics get tougher because we are getting closer to the time we must either “fish or cut bait.”
The General Assembly spent three days at the Carl Vinson Institute of Government being briefed on the economy, tax revenues, budget shortfall, HOPE, water, Special Council for Tax Reform and Fairness for Georgians, etc.
This was followed by two days at the Capitol discussing HOPE pre-K funding and other subjects.
Our first briefing on Sunday afternoon was on the budget and revenue projections. Revenue growth these past six months has been positive, even a little more than anticipated. The net revenue collections for the month of November 2010 (Fiscal Year 2011) totaled $1,268,525,000 compared to $1,188,879,000 for November 2009 (Fiscal Year 2010), an increase of $79,646,000 or 6.7 percent. The percentage increase for FY 2011 compared to FY 2010 is 7.4 percent. Even with this good news, there is still a hole of $1.6 billion to be filled (cut) in the FY 2012 Budget.
I have already written several articles on HOPE, and you have provided many suggestions for keeping the program viable. Until Governor-elect Nathan Deal provides additional guidance, there is little more to add. Dawson and Lumpkin School systems are two of the best in Georgia, but grade inflation in other parts of the state have caused us to waste millions of lottery and taxpayer dollars supporting students who really should not be in the University System.
One of the best briefings we received was by the chairman of the Special Council for Tax Reform and Fairness for Georgians, former banker A. D. Frazier. He said the panel will probably recommend broadening taxes on goods and services. Frazier also indicated that this tax could be partially offset by lowering the individual income tax rate. The final report is due to the General Assembly on Jan. 10, 2011, and any thoughts on what items will be included would be pure speculation.
Roger Tutterlow, an economist from Mercer University, said back in April that when Governor Zell Miller took the sales tax off groceries: “We took out of our tax base one of the most stable components of our sales tax collections.”
Since Tutterlow is on the council, we might speculate that some of the members could recommend putting State Sales Tax back on food.
Governor-elect Deal has said he’s against it. At our meeting in Athens, he “hedged his bet” with comments about mitigating that tax with rebates. I don’t really understand why we at the state level must dance around sales tax on groceries. The next time you buy groceries look closely at your sales receipt and you will note that while there is no state sales tax, all of your county and school taxes are applied. Of the 7 percent you pay on other goods, you continue to pay 3 percent on your food. If the counties and school systems continue to tax groceries, why not the state?
It should be noted that since Georgia has moved from being primarily a goods producing state to services, the mix of services and goods could produce a lot more sales tax revenues with a lower tax rate. Counties and cities could offset property taxes with additional revenues from taxing services.
As we enter the last week before Christmas, I wish for you all the best Christmas season and happy New Year ever. As the 2011 Session of the General Assembly starts on Jan. 10, I ask that you keep us on your prayer list.
We will have two sessions in 2011, because next summer will require a Special Session for Redistricting.
Rep. Amos Amerson can be reached at 689 N. Chestatee Street, Dahlonega, GA 30533; (706) 864-6589; e-mail email@example.com. Or call Gerald Lewy at (706) 344-7788.