Governor Nathan Deal laid out his vision, goals and agenda for 2013 and an annual budget of $19.8 billion budget that includes roughly $800 million for new construction projects. Sounds like a lot of money, and it is, but due to a lagging economy and sluggish state revenues the governor’s budget total is largely reflective of the amount spent the last few years (technically a $500 million increase over last year but still down $1 billion from 2008’s budget).
Highlights of the governor’s address and areas of emphasis for his legislative agenda include:
- Ethics – a hot topic for the last year and a half around the capitol, Gov. Deal went a step further than what the legislature has discussed with regard to a cap or ban on lobbyist gifts by suggesting that any gift/cap should apply to all elected officials from the state to the local level. The Georgia Senate on the first day of session this year passed new rules governing the body which included a lobbyist gift “cap.” House Speaker David Ralston has referred to it as a “gimmick” and “more of a sun visor than a cap” in remarks and has signaled the House may pass an outright ban. All of this is part of a broader push to clean up the image of Georgia state government and to help prevent the perception of impropriety.
- Healthcare/Medicaid – Georgia faces a $700 million shortfall in funding the state portion of Medicaid due in part to the expiration of the state “bed tax” or fee that hospitals pay back to the government as a way to “draw down” more federal matching dollars (Medicaid is a joint operation of the state and federal government whereby the feds have different schemes for states to bring in more money). Gov. Deal has advocated, and the Senate passed this week, legislation to re-authorize the “bed tax” by shifting the authority to the Department of Community Health. The legislation passed with a strong bi-partisan majority and will now move to the House where the governor will push for swift passage.
- Of note with respect to Medicaid, Gov. Deal has rejected calls from advocates and Democrats to expand Medicaid eligibility (as allowed for under Obamacare) to 133% of the federal poverty level. While the Democrats in the legislature and many advocates cry foul over a big pot of money the feds have dangled over the states to further expand this entitlement program, Governor Deal has pointed to a $4 billion price tag for Georgia taxpayers. NFIB/Georgia members in the 2013 Member Ballot overwhelmingly (90% oppose) support Gov. Deal’s position of not expanding Medicaid. In the recent effort to renew the “bed tax” Democrats in the Senate unsuccessfully tried to amend the bill to expand Medicaid and that vote may be a part of the NFIB/Georgia Legislative Voting Record.
- School funding/education – Georgia’s schools will see a slight bump in funding with an extra $300 million in new funds dedicated to poorer districts and to help fund the growth in enrollment in K-12, but cost of living increases for teachers and major new investments are not included in the governor’s plan. The governor did include some money for new school construction and pledged to return the popular pre-K program to 180 days.
- Government cuts – Credit to Gov. Deal for continuing to cut government in lieu of tax increases. While some of his counterparts have targeted tax increases on small business, the governor remains steadfast in his refusal to balance the state budget on the back of small business and instead has directed agencies to cut an additional 3% out of their budgets.
Things to watch:
The legislature, having burned four days this week, will take next week off to focus on budgetary hearings in the House. In the meantime, many big issues await the General Assembly upon their return:
1) Ethics – the Senate has passed rules, the House wants legislation, and the governor wants parity between state/local elected officials. Meanwhile the state ethics commission remains underfunded and barely capable of accomplishing their current mission.
2) Medicaid/The “Bed Tax” – The Senate has passed a bill with bi-partisan support but now the House must act. With 37 new representatives, many elected with conservative, Tea Party platforms, will House Republicans go along with reauthorizing this tax?
3) Falcons Rise Up in a New Stadium? – Much has been made of the Atlanta Falcons and owner Arthur Blank’s move to build a new retractable roof stadium in downtown Atlanta to replace the aging, albeit serviceable Georgia Dome. The public/private partnership will use approximately $300 million in hotel/motel tax revenues paid by visitors to the Atlanta area, but in order to build a new stadium, the GeorgiaWorldCongressCenter, the authority that runs and manages the current Dome and would manage the new stadium, needs the legislature to approve an increase in its borrowing authority. Many conservative Republicans and some Democrats have publicly balked at this move over a myriad of concerns from cost, return on investment, timing and best use of public dollars. This issue will be one to watch going forward.
4) The State Budget – with an uncertain climate in DC, a shaky economy, and uneven tax revenues, budget writers this year are faced with a difficult task of funding state government. Forecasters will be watching state revenues and projections closely as they try to assemble a budget that funds the basics and some key projects such as the deepening of the Port of Savannah.
Next week I’ll lay out the agenda NFIB/Georgia will be pursuing in the 2013 session and talk about some issues where our members have now weighed in.