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Gold Dome Nuggets: Tax overhaul on ice for 2011?

By   /   January 31, 2011  /   Comments

It appears, at least for this year, that the proposal submitted by the Special Council on Tax Reform and Fairness for All Georgians is dead. Gov. Nathan Deal expressed concerns this week about attempting to reform the state’s tax code at a time when Georgia is struggling economically.

The proposal had received praise from the Wall Street Journal for moving in the direction of a broad-based consumption model. However, it drew admonition from the National Taxpayers Union and Grover Norquist’s Americans for Tax Reform for being, in their view, a net tax hike on Georgians. Both groups acknowledge that some of the reforms were good public policy.

Norquist attended the Georgia Center-Right meeting on Friday at the Capitol to discuss the proposal reforms with the tax council’s chairman A.D. Frazier. Norquist left the meeting with an understanding that the proposal wasn’t intended to be a tax increase. According to the Atlanta Journal-Constitution, Norquist said, “They were very clear: ‘We mean this to be revenue-neutral. We’ll see what they put together, but that sounds pretty good.”

Analysis: Signaling this isn’t a good year for a tax overhaul that includes tax increases, Governor Nathan Deal told Larry Peterson of the Savannah Morning News, “We’re not going to sign anything that is a tax increase … in this climate, no matter how intentioned it is.”  That would include, among others, increases in the grocery tax and the cigarette tax.  Deal’s reluctance to voice support for the tax increases the tax reform council recommended may spell its doom, not just for this year, but completely.  However, an economic turnaround may at some point revive the council’s recommendations and have them get a second look.  But that could be years away.

Immigration Bill

Legislation expected to be filed Rep. Matt Ramsey (R-Peachtree City) to deal with immigration is expected to be tougher than the law passed last year in Arizona, which has come under scrutiny in court.

Ramsey’s bill, dubbed the Illegal Immigration Reform and Enforcement Act of 2011, will require private employers to use E-Verify to determine whether prospective employees are in the state legally.

The legislation will also require “verifiable identification” to receive taxpayer-funded benefits. And like Arizona’s law, it allows local law enforcement more latitude when dealing with a suspected illegal immigrant during a lawful stop or detention.

According to Ramsey’s press release, his proposal also “creates criminal penalties for any individual that encourages an illegal alien to come to Georgia or that’s transports or harbors an illegal alien once they arrive.” Supporters of the legislation say that this particular provision will be dropped in committee.

Rumor has it House Speaker David Ralston is cool to the legislation, preferring instead to have legislators focus on the budget.

Rival legislation introduced by Sen. Jack Murphy (R-Cumming) would “tweak” Georgia’s immigration laws. Murphy’s legislation would exclude the agriculture community.

In 2006, the legislature passed SB 529, which was considered the toughest immigration law in the country; at least until Arizona’s new law. According to the National Conference of State Legislatures, the Georgia Security and Immigration Compliance Act required “public employers to participate in a federal work authorization program for all new employees beginning July 1, 2007; subcontractors must also register and participate (section 2). The bill increases the penalties for human trafficking (section 3).

The bill authorizes the state to negotiate a memorandum of understanding with the U.S. Department of Justice or U.S. Department of Homeland Security regarding enforcement of federal immigration and customs laws (section 4). If a person is charged with a felony or drunk driving and confined to jail, an effort shall be made to determine the nationality; if the person is a foreign national, a reasonable effort shall be made to determine that the person has been admitted into the United States lawfully (section 5).

The bill also establishes and enforces standards of ethics by those that provide immigration assistance services who are not licensed attorneys (section 6). The bill denies certain deductible business expenses unless the worker has been authorized and verified to work in the U.S., beginning in 2008 (section 7). The bill requires income tax withholding at 6 percent for those who failed to provide a correct taxpayer identification number (section 8). State agencies must also verify the lawful presence of an individual before awarding certain benefits; emergency assistance, vaccines and other programs are exempted (section 9).”

Analysis: While immigration is one of the priorities Gov. Deal mentioned in his State of the State speeches, it remains to be seen if Ramsey’s version is what he or other members of the legislature want.  As mentioned, the Speaker is rumored not to be that keen on immigration as a key issue, much less this fairly drastic overhaul of the state’s law.  He may lean more toward Sen. Murphy’s “tweak” as something that can be quickly done in the House, if passed in the Senate, and have the House return to the work of the budget while having met the Governor’s priority.

There is also building resistance to the Ramsey bill among the agricultural community.  Farmers aren’t particularly enamored with much of the language of the bill or the mandates it places on them.

Zero-Based Budgeting

Despite the Senate overriding then-Gov. Sonny Perdue’s veto on SB 1, which would require the appropriators to implement zero-based budgeting; overhauling the budget once every four years. The House will likely not take it up. Instead, they will push HB 33, sponsored by Rep. Stephen Allison (R-Blairsville). The House is of the opinion it can write better legislation than SB1 on the issue.

Perdue vetoed the bill, sponsored by Sen. David Shafer (R-Duluth), last June due to “realities of Georgia’s and other states’ experiences have demonstrated few results worth the overhead associated with [zero-based budgeting].”

Analysis: Zero-based budgeting is a way of requiring government to “justify” it’s expenses periodically.  It is indeed a more expensive way to budget and thus not used yearly.  But the zero-based requirement every third or fourth year could be worth the cost and beneficial to the State’s bottom line because it would help identify, through the justification process, those areas of state government that could be scaled back, defunded, or eliminated (zero-based budgeting does not allow department heads to carry over unspent funds to the next year).  Additionally, it would help State auditors identify areas of potential waste, fraud and abuse.  Look for some form of zero-based budgeting to come into existence this year in a compromise between SB1 and HB 33.

Sunday alcohol sales

An InsiderAdvantage/Rosetta Stone Communications poll has found support for a bill which would allow local referendums on the question of Sunday alcohol sales is there.   By a margin of 52% to 40% with 8% having no opinion, the majority agree that the state should allow decentralized decision making on the question.  Governor Deal has indicated he would sign legislation allowing that.

Analysis: It should be noted that it might not be as easy as it seems given the numbers above.  When broken out by region, the Atlanta region is the only one which approves of the idea overwhelmingly, enough so that the poll reflects a majority “for” passage.  But getting the legislators in the regions not in favor of the legislation may not be easy. 25% of those surveyed said voting for the measure would be reason enough not to vote for that legislator in the next election.  While most in the Atlanta area think it is an idea whose time has come, much of more rural Georgia continues to be against it.

Also note that the law would not roll back the Sunday blue laws entirely.  The sale of alcohol wouldn’t be allowed until after 12:30pm on Sunday.

Savannah Port project update

Underscoring the importance of the Savannah Port project, Gov. Nathan Deal traveled to Savannah Friday with Sen. Saxby Chambliss.  The ostensible purpose of the trip was to get a look at one of the new larger container ships which is presently too large to fit through the Panama Canal.  The ship was delayed in arriving at Savannah and missed it’s tidal window.  That meant a 12 hour delay as it waited off shore for the next favorable tide and underscoring why deepening the harbor is so important.

Deal and Chambliss stressed the vital economic importance of the port and the equally important project to deepen Savannah harbor to allow those larger ships easier egress.  The pair was also using the day to stump for federal dollars necessary to do the project.

Chambliss made it clear that this was a “must do” project that would be an excellent way for the federal government to create jobs and generate exports.  Calling it an “economic engine”, Chambliss said he hoped to see funding for the Savannah port included in the next federal budget.

Chambliss called Savannah “the fastest growing port in the nation”.  According to the Georgia Ports executive director, Curtis Foltz, 12% of the nation’s container exports go through the port of Savannah.  Deepening the port is vital to maintaining and increasing that percentage.

Analysis: This particular project is extremely important economically, not only to Savannah in general, but to the state of Georgia.   The ripple effect of the increased traffic and commerce it will bring can’t be overemphasized.  The Governor’s decision to visit the port early in his administration accompanied by Sen. Chambliss emphasizes that importance and raises the project’s visibility – both important to ensuring the necessary dollars from the federal level will be budgeted this year.

What’s on tap?

Both chambers of the legislature will be in session on Monday. There are 34 days left in the session.

House Committee Hearings

Date Time Committee Location
Monday, 1/31/11 TBD General Session (Day 7) Chamber
Monday, 1/31/11 9:00 Appropriations Public Safety Subcommittee 415 CLOB
Monday, 1/31/11 11:00 Judiciary Non-Civil 132 CAP
Monday, 1/31/11 3:00 Information & Audits 515 CLOB
Monday, 1/31/11 3:00 Public Safety & Homeland Security 415 CLOB
Tuesday, 2/1/11 TBD General Session (Day 8) Chamber
Tuesday, 2/1/11 8:00 Game, Fish & Parks 403 CAP
Tuesday, 2/1/11 8:30 Legislative and Congressional Reapportionment 406 CLOB
Tuesday, 2/1/11 1:00 Appropriations Public Safety Subcommittee 415 CLOB
Tuesday, 2/1/11 2:00 Higher Education 406 CLOB
Tuesday, 2/1/11 2:00 Insurance 606 CLOB
Tuesday, 2/1/11 2:00 Appropriations Econ. Development Subcommittee 341 CAP
Tuesday, 2/1/11 2:00 Children & Youth 403 CAP
Tuesday, 2/1/11 3:00 Ways & Means 606 CLOB
Wednesday, 2/3/11 TBD General Session (Day 9) Chamber
Wednesday, 2/3/11 8:00 Science & Technology 506 CLOB
Wednesday, 2/3/11 8:00 Agriculture and Consumer Affairs 403 CAP
Wednesday, 2/3/11 1:00 Special Rules 415 CLOB
Wednesday, 2/3/11 2:00 Regulated Industries 515 CLOB
Wednesday, 2/3/11 2:00 Retirement 403 CAP
Wednesday, 2/3/11 2:00 Economic Development & Tourism 406 CLOB
Thursday, 2/3/11 TBD General Session (Day 10) Chamber
Thursday, 2/3/11 2:00 Motor Vehicles 606 CLOB
Friday, 2/4/11 9:30 Judiciary Non-Civil 132 CAP

Senate Committee Hearings

Date Time Committee Location
Monday, 1/31/11 2:00 Veterans, Military & Homeland Security 125 CAP
Monday, 1/31/11 3:00 Judiciary 450 CAP
Monday, 1/31/11 4:00 Science & Technology 307 CLOB
Tuesday, 2/1/11 8:00 Appropriations Natural Resources Subcommittee 125 CAP
Tuesday, 2/1/11 1:00 Special Judiciary 125 CAP
Tuesday, 2/1/11 1:00 Transportation MEZZ 1
Tuesday, 2/1/11 2:00 Public Safety 450 CAP
Tuesday, 2/1/11 2:00 Retirement 125 CAP
Tuesday, 2/1/11 2:00 Appropriations Higher Education Subcommittee 310 CLOB
Tuesday, 2/1/11 3:00 Insurance & Labor 450 CAP
Tuesday, 2/1/11 3:00 Higher Education 125 CAP
Tuesday, 2/1/11 4:00 Agriculture & Consumer Affairs 125 CAP
Tuesday, 2/1/11 5:00 Rules 450 CAP
Wednesday, 2/2/11 1:00 Finance 310 CLOB
Wednesday, 2/2/11 1:00 State & Local Government Operations 307 CLOB
Wednesday, 2/2/11 2:00 Banking & Financial Institutions 307 CLOB
Wednesday, 2/2/11 2:00 Health & Human Services 450 CAP
Wednesday, 2/2/11 2:30 Appropriations Insurance Subcommittee 125 CAP
Wednesday, 2/2/11 3:00 Natural Resources & the Environment 450 CAP
Wednesday, 2/2/11 3:00 State Institutions & Property 310 CLOB
Wednesday, 2/2/11 4:00 Judiciary 310 CLOB
Wednesday, 2/2/11 5:00 Rules 450 CAP
Thursday, 2/3/11 8:00 Appropriations Agriculture Subcommittee 450 CAP
Thursday, 2/3/11 1:00 Transportation MEZZ 1
Thursday, 2/3/11 1:00 Insurance 125 CAP
Thursday, 2/3/11 2:00 Regulated Industries & Utilities 450 CAP
Thursday, 2/3/11 2:30 Appropriations Economic Development Subcommittee 310 CLOB
Thursday, 2/3/11 3:00 Ethics 307 CLOB
Thursday, 2/3/11 3:00 Government Oversight 125 CAP
Thursday, 2/3/11 4:00 Public Safety 450 CAP
Thursday, 2/3/11 5:00 Rules 450 CAP
Friday, 2/4/11 8:00 Appropriations Natural Resources Subcommittee 125 CAP
Friday, 2/4/11 9:00 Appropriations Community Health Subcommittee 450 CAP
Friday, 2/4/11 11:00 Appropriations Human Development Subcommittee 450 CAP
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  • Published: 1673 days ago on January 31, 2011
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  • Last Modified: January 31, 2011 @ 5:47 pm
  • Filed Under: Politics

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Owner / Editor / Writer

Tom Knighton is the publisher of The Albany Journal. In November, 2011, he became the first blogger to take over a newspaper anywhere in the world. In August of 2012, he made the difficult decision to take the Journal out of print circulation and become an online news agency, a first for the Albany area.

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