Budget takes center stage as session's days dwindle

With only four days left in the 2010 legislative session, lawmakers return to Atlanta on Tuesday very close to passing a budget.

But as the session continues to crawl at a snail’s pace -- the last four days could take at least two more weeks -- there is still some heavy lifting that has to be done before the massive spending plan is finalized.

Last Wednesday, the Georgia General Assembly saw one of its most intense days of the session as bills flew back and forth between the House and the Senate at a breakneck pace.

When it was over, the House passed a cobbled-together $17.8 billion budget that drew upon a combination of fee and tax increases to avoid some of the drastic cuts that many considered earlier in the year.

“Certainly we are in unchartered territory as it relates to the economic condition of this state. That’s the environment we find ourselves in. So what do you do? You make do with what you’ve got,” said Rep. Mickey Channell (R-Greensboro), an 18-year member of the House. “Has it been difficult? Of course. Yes. We’ve had to reduce funding for education. We’ve had to reduce funding for everything in this state. We don’t have the alternatives they have in Washington -- where you can just go to spending our kids', grandkids' and great-grandkids' funds.”

In what is becoming one of the longest legislative sessions in history, lawmakers have been struggling for months to come up with ways to fill a nearly $800 million budget shortfall, because of declining revenues.

One example of the cuts that were avoided or smaller than predicted was in higher education. The Board of Regents initially faced up to $600 million in cuts for fiscal year 2011, which would have forced the system to hike tuition, drop course sections and eliminate popular programs like 4-H.

Instead, they are looking at net cuts in the neighborhood of $280 million -- drastic, but not tragic.

John Millsaps, associate vice chancellor for media for the Board of Regents, said the cuts are “reasonable,” considering the “state budget is not in good shape.”

“We were certainly supportive of the governor’s recommendations and appreciative of the House version of the budget, which seems to track the governor’s version,” Millsaps said. “We feel like the recommendations put forward helps us meet our mission. But obviously, we have to continue to do some more cutting.”

The budget, which still needs to pass the Senate, is now bound for a committee of negotiators of the House and Senate before facing final approval in the next two weeks.

Lt. Gov. and Senate President Casey Cagle said the top priority now is balancing a budget that promotes job creation, helps working families and provides a foundation for future economic growth.

"While we will have to make some very difficult budget decisions, we are positioning our state for greater flexibility in the future. The Senate will take a hard look at how we spend every tax dollar and will provide a budget that is focused on essential services,” Cagle said. “At the end of the day, we will have cut state government by nearly 24 percent. And when you consider that 80 percent of the budget is comprised of k-12 education, higher education, corrections and health care, our choices are not easy."

In terms of choices, the House included $10 million to help pay for the new College Football Hall of Fame, which is relocating to Atlanta from South Bend, Ind., but rejected a $9 million plan to expand horse facilities at the state fairgrounds. Standardized testing for first- and second-graders, as well as free PSAT and Advanced Placement tests for older students, has been ripped from the budget.

As part of crafting the spending plan, lawmakers in the House also voted 107-63 to offer new tax cuts for wealthy seniors and property owners. But with the tax cuts, the House also tacked on dozens of fee increases and the controversial hospital bed tax. The Senate passed that portion of the bill, as well, by 39-12. The bill would raise $96 million in fees.

One provision of the bill would eliminate a small portion of property taxes that go to the state, saving property owners a few dollars a year by some estimates. The second would eventually eliminate all state income taxes on retirement income for residents age 65 and over. Currently, senior citizens who have retirement income of $35,000 a year or less, or $70,000 for a couple, aren’t taxed.

Combined, the tax breaks would cost the state $387 million over the five years, but seniors and property owners will still have to wait until 2012 before they start seeing any savings and 2016 before the full tax breaks kick in.

But there are still pockets of resistance to the plan.

House Minority Leader DuBose Porter (D-Dublin), a candidate for governor, called the budget “irresponsible.”

“It’s harmful to every working Georgian,” he said, referring to the fee increases and the bed taxes. “I don’t care if you put sunglasses on it, a wig on it or an overcoat -- you can’t disguise it as anything but a tax increase on the most vulnerable, the sick. We’re just not accepting the responsibility we have.”

Rep. Lee Thompson (D-Lawrenceville) questioned why lawmakers are funding a tax break on fuel for Delta Air Lines, but set aside no money to fulfill a pledge of a 10 percent salary increase for the state’s 2,033 National Board Certified teachers. He called it “poor priorities.”

Rep. Alan Powell (D-Hartwell) was even more blunt.

“For six straight years, we raised the budget from $14 billion to $22 billion,” Powell said. “Did a billion dollars in bonded debt each year. Then all the sudden, we woke up one day with an empty pocket. And we said, ‘Whoa, this must be because of the depression.’ No, ladies and gentlemen, we all caused this problem."

Staff writers Nancy Badertscher and Aaron Gould Sheinin contributed to this article.

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