2024 Capitol Update - Week 2

By Christy Tarallo

1/23/2024

January 23, 2024

Every second week of the Georgia legislative session is “Budget Week”. Lawmakers temporarily recess from the pre-set legislative calendar in order to host a marathon 3-day joint appropriations committee session, where state agency heads present the Governor’s recommendations for their budgets. The state annually deals with two budgets, the amended budget which revises the spending plan for the final 90 days of the current fiscal year, in this case FY 2024 ending on June 30, 2024, and the next fiscal year’s full budget—FY 2025 which runs from July 1, 2024 to June 30, 2025.

The state of Georgia should be, justifiably, the envy of the nation after fiscally conservative appropriations resulted in a surplus of $5 billion this past year fiscal year. This is coupled with two prior years of budget surpluses equating to north of $10 billion over the past three fiscal years.

Considering the surplus, the amended budget saw some dramatic recommendations for the use of those additional dollars. The FY 2024 budget originally totaled $32.4 billion, but the amended recommendation includes an additional $3.1 billion in spending. The new total for FY 2024, the largest in the state’s history, is now $37.5 billion.

The Governor recommends utilizing those new dollars in the amended FY 2024 (AFY 24) budget in unique ways, including:

$1.5 billion in dedicated funding for the Georgia Department of Transportation to fund priority projects for economic development sites and freight & logistics; including $667 million for construction projects in GDOT’s existing pipeline, $641 million for the freight movement improvement, and $200 million for Local Maintenance and Improvement Grants (LMIG). These amounts would be on top of GDOT’s regular annual budget as well as the Governor’s recommendation to backfill all of the lost revenue resulting from last year’s gas tax suspension.
Funding roughly $1.9 billion in capital projects—in cash. Typically, capital project recommendations range from $800 million to $1 billion, and are funded by bonds. This recommendation not only exceeds usual capital project recommendations, but utilizing cash to fund these projects has not been done in recent memory and will save the state an estimated $1.3 billion in interest over 20 years (these projects will be split between the AFY 24 budget and the FY 25 budget)
One-time funding for a new dental school at Georgia Southern University in the amount of $178 million and a new medical school at the University of Georgia in the amount of $50 million
$250 million for local water and sewer projects financed through the Georgia Environmental Finance Commission

It’s important to note here that the state has a policy of not utilizing surplus revenue to create long-term obligations, so all of the recommendations are one-time appropriations that won’t leave the state in dire straights if revenues collection were to take a turn for the worse.

The multi-year surpluses have also prompted the Governor to recommend the state quicken the state income tax reduction. The proposal is to decrease the income tax rate from 5.49% to 5.39% this year with a retroactive date of Jan 1, 2024. Ultimately, the goal is to reduce the income tax rate to 4.99% by 2029.

The Governor’s spending plan for FY 2025 totaled $36.1 billion and includes roughly $700 million in pay raises for state and university system employees, school teachers, state law enforcement officers, and child welfare workers. Other full budget highlights include:

Restoring a $66 million cut to public universities that the Senate recommended last year
$11 million in pre-k funding to cut class sizes from 22 to 20
Roughly $160 million in funding for elderly and disabled care
$205 million to “update the pupil transportation formula” to help modernize and update student transportation
$1.4 billion total in additional school funding for growth, teacher pay & benefits, and school security
$1.3 million for the Professional Engineers and Land Surveyors Board (up $300,000 from last year)

The week ahead: the legislature will meet for Legislative Days 6 through 10 this week. Don’t forget to save the date and register for our annual Engineers Day at the Capitol on February 13^th!

LEGISLATION ACEC GEORGIA IS FOLLOWING:

Industry & Professions

HB 267 by Representative Tyler Paul Smith (R-Bremen): would allow an individual to pursue a civil action and seek injunctive relief if an employer, other than a governmental entity, fails to withhold taxes properly from wages paid to an employee.

Status: Currently in the House Judiciary Committee after failing to receive consideration on the House floor.

ACEC Georgia is reviewing this legislation

HB 880 by Representative Bethany Ballard (R-Warner Robins): proposes to allow military spouses with an existing license in good standing from another state to bypass licensure board approval in order utilize their out-of-state license to work in Georgia. Numerous successful proposals have worked to create a more friendly licensure environment in Georgia for military spouses, including a 90 day shot-clock for board action after receiving a comity license application, and expedited licensure by endorsement, which simplifies the process of comity applications and requires these applications to be considered before any others may. We are opposed to any legislation that bypasses the licensure board and undermines the board’s authority to approve licenses, particularly for those licenses which exist to protect the health, safety, and welfare of the public.

Status: Assigned to the House Regulated Industries Committee

ACEC Georgia opposes this legislation.

SB 157 by Senator Brian Strickland (R-McDonough): proposes several changes relating to the application process for occupational licenses in Georgia by individuals with criminal records. This bill clarifies what types of crimes would disqualify an individual from receiving a license, creates an appeals process for an individual who may have been denied a license based on their criminal record or other unknown or undisclosed reason, and creates a “preclearance” process for determining whether an individual's criminal record will disqualify them from obtaining a license before paying and completing required education and training for that license. This bill aims to decrease regulatory burdens and streamline burdensome and onerous licensing processes.

Status: Passed the Senate Judiciary Committee. Passed the Senate by a vote of 55-0 in 2023. Currently in the House Judiciary Non-Civil Committee.

ACEC Georgia supports this legislation

SB 186 by Senator Greg Dolezal (R-Cumming): would revise the premises liability law to limit the cause of action currently available for individuals injured by an unrelated third party on a landowner’s property. The bill would require a plaintiff to prove that the landowner compelled the third party’s action, had knowledge of a specific threat, or could have reasonably intervened in the situation that resulted in injuries to the plaintiff. This would also create a process for apportionment of damages between the third party and landowner.

Status: Passed to the Senate Insurance & Labor Committee; sent back to the Insurance & Labor Committee. This bill may be reconsidered this session.

ACEC Georgia supports this legislation

SB 200 by Senator Bill Cowsert (R-Athens): is what is known as the “Apex Doctrine”. It would create a process for which a c-suite or other high-level executive within a corporation can petition a court to show that a requested deposition is unnecessary or burdensome. Under current law, if a company is the defendant in a suit, the plaintiff may request a deposition of top-level executives, even when they are not involved in any capacity.

Status: Passed the Senate Regulated Industries & Utilities Committee; sent back to the RI&U Committee. This bill may be reconsidered this session.

ACEC Georgia supports this legislation

Transportation

HB 307 by Representative Alan Powell (R-Hartwell): deals with the regulation of electric vehicle charging broadly. It creates a framework which aims to allow for “competitively neutral policies” between electric suppliers (such as Georgia Power or EMCs) and non-providers to promote private sector investment. The proposal would require electric suppliers to create a separate subsidiary for electric vehicle charging infrastructure and provide the same rates, terms, and conditions of service for non-providers as the subsidiary receives. It would also prohibit electric providers from recovering costs for implementation and execution of EV charging from its ratepayers. The bill also allows for charging by the kilowatt hour (there are discrepancies as to whether kilowatt hour charging is allowed under current law) and endows the Public Service Commission with the authority to provide oversight of the industry and entities engaging in charging infrastructure.

Status: Assigned to the House Technology and Infrastructure Innovation Committee.