The slide in state revenues continued in February as total revenues were slightly positive at 0.5 percent. The key monthly indicator, individual income taxes, was up only 1.7 percent. Sales taxes were negative at minus-2.4 percent. Corporate income taxes were up from $6 million in 2007 to $18 million in 2008.
Year to date, revenues are up slightly at 1.9 percent, a figure that is tied closely to the slide in individual income taxes, which are up only 2.9 percent YTD. Sales taxes, about one-third of total revenues, are only showing an increase of 0.6 percent.
The state budget for FY2008, which ends in June is based on a growth rate of 2.94 percent, which indicates that the revenues for the balance of this year might not reach the revenue estimate. As a result, the governor reduced the revenue figure for FY08 by $65 million and suggested eliminating $30 million for school technology and $25 million for school buses.
Governor reduces 2009 revenue estimate
Additionally, Gov. Sonny Perdue reduced the revenue estimate for FY09 by some $245 million as a precaution in case revenues do not turn around over the next few months.
A list of suggested cuts equal to $245 million include:
• Partial reduction of the proposed COLA for state employees, teachers, and Regents faculty from 2.5 percent to 2 percent.
• Elimination of the $16.9 million in funding for the Health Insurance Partnership.
• Elimination of funding for the Department of Corrections day care centers at $5.2 million and additional bed space at county correctional institutions of $8 million.
• Reducing funding for the Very Important Parent (VIP) recruiter program initiative by $5.5 million.
• Reduction of the grant in aid to county health departments by $7.1 million.
• Bonding of major repairs and renovations funds for Regents and technical and adult institutions of $47 million.
• Elimination of bond projects — converting the former World of Coke building to a state museum; and one airplane and three helicopter purchases.
• $17 million for the matching funds for the Georgia Ports Authority Savannah River deepening project.
Bills of interest
The following bills and resolutions passed the Senate this week:
• S.B. 196: Grants college scholarships to Georgia residents 25 years or younger whose parent(s) sustained qualified combat-related injuries.
• S.B. 327: States that any bill requiring a public retirement system to divest or refrain from investing in specific investments or classes of investments may only be introduced in the first year of the biennial session.
• S.B. 461: Redefines the term “bullying” and expands the scope of the required policies that must be adopted by local school boards that prohibit bullying.
• S.B. 519: Requires written notice before foreclosure.
• S.B. 535: Requires local school systems to maintain accreditation in order to receive QBE funds.
• S.B. 537: Puts the present Office of Inspector General into state code.
• S.B. 539: Creates a certificate of need exemption for continuing care retirement communities.
• S.B. 547: Expands the offense for which a fine add-on is required with the funds going to the Brain & Spinal Injury Trust Fund. This bill is related to S.R. 1074, a constitutional amendment which dedicates those funds.
• S.B. 548: Expands penalties for misuse of purchasing authority by state employees. Misuse or personal purchase under $500 is a misdemeanor and misuse over $500 is a felony.
• S.R. 515: A constitutional amendment that would exempt homesteads of teachers, firefighters, and law enforcement officers from ad valorem taxation up to $250,000. In urban areas, this is an attempt to keep those people in local neighborhoods.
• H.B. 291: Creates the Georgia Arts Alliance, its board of trustees, and their advisory committee.
• H.B. 301: Increases penalties for training dogs for fighting, organizing bets, and advertising exhibitions.
• H.B. 1088: Promotes the development and maintenance of agricultural tourist attractions by limiting the liability of the farmer.
To find out more about any legislation, visit the Legislature’s home page at www.legis.state.ga.us