Capitol Recap: New surplus could mean more rebates for Georgia taxpayers

Tax collections outperform woeful projections for fiscal year

Georgia taxpayers could receive a third rebate in three years, as all signs point to another huge state surplus for the fiscal year that just ended.

An exact total isn’t available yet. That won’t be known until all the bills are paid and state agencies return funds they did not use. But administration officials said it could top $5 billion.

That comes after a record $6.6 billion state surplus in fiscal 2022 that funded tax rebates of $250 to $500 that the state started sending out to most taxpayers in May.

The newest surplus is, in a sense, the product of lowered expectations.

Gov. Brian Kemp’s team projected a huge decline in revenue for the fiscal year, including a $3 billion drop from last year in revenue from capital gains taxes and an additional $600 million decrease in corporate taxes.

It made sense.

Taxes paid in fiscal 2022 were based on earnings from 2021, when the S&P 500 index returned 26.61%. Last year, however, the markets slumped, falling nearly 20%, so Kemp’s economic team was expecting investors to pay far less this spring when taxes came due. They also expected a rough year for corporate income tax collections.

Once the governor’s estimate was in, it set a ceiling on how much lawmakers could budget to spend for schools, public safety, road construction and other services. So, based on Kemp’s projection, lawmakers in March approved a $32.5 billion midyear budget.

But fiscal 2023 defied the projections.

Individual income tax collections fell, but only by $1.3 billion, rather than the $3 billion Kemp & Co. predicted. Meanwhile, corporations paid $1.3 billion more than expected as the state’s economy continued to grow. And revenue from sales taxes climbed by 8.4%, in part because products cost more due to inflation.

So the state is going to have more money than it planned for.

Senate Appropriations Chairman Blake Tillery, R-Vidalia, said the state should again look to refund some of the tax surplus if possible.

“I think we have some liabilities, but I think it’s important that we remember where the money came from and every time we can we should return it to where it came from,” he said.

So far this year, Kemp has remained in belt-tightening mode, repeatedly saying there is economic uncertainty ahead. In May, he angered legislators from both parties when he vetoed or told agencies to ignore about $230 million in spending that they had included in the fiscal 2024 state budget.

Credit: Arvin Temkar/AJC

Credit: Arvin Temkar/AJC

Kemp discourages talk of presidential bid, but he’s still raising a lot of money

It doesn’t sound like he’s running for president, but Gov. Brian Kemp is piling up a lot of cash.

Kemp’s name had been dangled recently by GOP strategists and donors — wary of another run by Donald Trump — as a potential challenger to the former president as enthusiasm appeared to dwindle for numerous other Republican candidates, such as Florida Gov. Ron DeSantis.

While Kemp let that talk hang in the air for a while, he went a long way in discouraging it this past week.

“There’s a lot of good people running for president right now on the Republican side,” Kemp told News 95.5 and AM 750 WSB host Scott Slade, “and I think having me or anybody else get in the race right now really undermines our ability to be able to win and beat Joe Biden, which we absolutely must do.”

Many of Kemp’s closest allies see another run for public office in his future, but they think that’s more likely to be a bid in 2026 for Democratic U.S. Sen. Jon Ossoff’s seat.

Still, Kemp won’t sit idle in 2024.

He plans to be a factor in the election, most likely using his leadership committee — a fundraising tool available only to him and a few others in the state to take in unlimited amounts of campaign donations — to help other Republicans win their races.

Kemp has turned his committee, the Georgians First Leadership Committee, into an alternative to the state GOP after former party Chair David Shafer openly supported Trump-backed challengers to the governor and other Republican incumbents in the 2022 primaries.

The governor has used the committee to support vulnerable Republicans in the state Legislature and challenge Democrats in swing districts, helping hire campaign operatives and spurring voter turnout.

It could have an even bigger role next year, as Republicans hope to put Georgia — now considered one of the few battleground states in the upcoming presidential election — back in their column.

So he’s stocking up cash.

In financial records released this past week, Kemp reported that the fund had about $3.7 million on hand and an additional $1.5 million in investments.

That bounty includes about $1.2 million he collected in May while meeting with some of his top donors and allies during a three-day Sea Island retreat.

Georgia files suit against group, seeking proof to back claims of 2020 voter fraud

Enough talk. Prove it.

That’s essentially what the State Election Board told a Texas-based conservative election organization that has promoted allegations of ballot harvesting in Georgia but has resisted subpoenas seeking proof of its claims.

The State Election Board filed suit this past week in Fulton County Superior Court asking a judge to compel True the Vote to provide evidence to back its accusations of voter fraud in the 2020 presidential election.

True the Vote has alleged that several unnamed organizations paid unnamed individuals $10 per absentee ballot delivered to drop boxes across metro Atlanta.

The suit follows more than a year of attempts by the State Election Board to find out whether that allegation is true. True the Vote, however, has refused to provide details and documents to support its case, which was highlighted in the movie “2000 Mules.”

“Allegations of election irregularities need to be accompanied by evidence,” Secretary of State Brad Raffensperger said. “I encourage anyone with such evidence to turn it over and it will be fully investigated. But if you don’t have the evidence, don’t come into Georgia and make far-fetched and hyperbolic claims. It’s long past time to put up or shut up.”

True the Vote has objected to revealing information about an anonymous source who it alleges collected ballots and delivered them to drop boxes.

“True the Vote insists it has an obligation not to disclose the identity of confidential sources, out of concern for their physical safety,” attorney Michael Wynne wrote in a June 30 letter to Assistant Attorney General Elizabeth Vaughan.

Collecting multiple absentee ballots, a practice sometimes called ballot harvesting, is illegal in Georgia, with exceptions for family members and caregivers of disabled voters.

The State Election Board previously dismissed a case against voters who were accused of illegally returning multiple absentee ballots, finding that in each case the ballots belonged to family members in the same household. But True the Vote’s claim of a broad voter fraud conspiracy is still pending.

Credit: Natrice Miller/AJC

Republicans serve up a federal election proposal at Marietta eatery

The Marietta Diner, early this past week, offered a unique special of the day.

It was U.S. House Republicans’ new election bill, a 170-page proposal that would limit private funding for election administration, penalize states that allow noncitizens to vote in local elections and prohibit federal agencies from participating in voter registration activities.

The Republicans chose the eatery as the site to unveil the measure — modeled at least in part on Georgia’s voting laws — because they said the state can serve as an example for the rest of the country in the run-up to next year’s presidential election.

It was following Donald Trump’s narrow loss in the 2020 election that the GOP-controlled General Assembly made major changes to Georgia’s election laws.

Those changes may have satisfied some conservatives who questioned Trump’s loss, even after recounts, court cases and investigations upheld Democrat Joe Biden’s victory in the state by about 12,000 votes.

But they also spurred protests from Democrats who saw them as new barriers to voting.

Major League Baseball responded by moving its 2021 All-Star game from Cobb County’s Truist Park to Denver. That was a key reason Republicans introduced their bill at a Marietta restaurant, although the Big Chicken may have made for better pictures.

“I think it’s really important (to be in Cobb County),” U.S. Rep. Bryan Steil, a Wisconsin Republican and chairman of the House Administration Committee, “because as many of you know, two years ago, Major League Baseball pulled the All-Star game.”

Steil pointed to that decision as an error that became clear during the 2022 midterms.

“What we didn’t see was the narrative of the left materialize. What we saw was people had confidence in the election here in Georgia,” Steil said. “We saw people have a positive experience in voting here.”

It was certainly a positive experience for Republicans. They won nearly every statewide race.

Democratic U.S. Rep. Joe Morelle of New York criticized the proposal, saying it was “designed to appease extremist election deniers who have spent the last four years attacking our democracy.”

He also took aim at a part of the bill that would repeal limits on fundraising coordination between political candidates and political parties.

“It would restrict the fundamental right to vote, especially for voters of color, jeopardize the security of our elections, burden local election administrators and bring more dark money into our electoral process — opening the door to corruption,” Morelle said. “It’s anti-American.”

The bill is likely a nonstarter, facing obstacles similar to the ones that greeted congressional Democrats’ proposals following the 2020 presidential election.

The Democratic proposals — seeking to make Election Day a holiday, limit voter purges, allow people to register to vote and cast a ballot on the same day, and strengthen federal oversight of changes to state voting laws — were unable to get past a GOP filibuster in the U.S. Senate.

This time, the GOP bill may win passage in the House, but votes could be tough to find in the Democratic-led Senate.

Credit: Arvin Temkar/AJC

State House Democrat jumps to Republicans

State Rep. Mesha Mainor is a Democrat no more.

The lawmaker joined Republicans this past week after saying she faced “harassment and intimidation” from Democrats after breaking with the party during the past legislative session on several key votes.

Mainor, who represents a Westside Atlanta district where over 89% of voters backed Democrat Joe Biden in the 2020 presidential election, is believed to be the first Black woman to serve as a Republican in the Georgia General Assembly, according to state House officials. Her move gives Republicans a 102-78 majority in the House.

The lawmaker, joined at a Georgia Capitol press conference by state GOP Chair Josh McKoon, said Democrats “slandered me in every way imaginable.”

Among her heavier critics was state Sen. Josh McLaurin, a Democrat from Sandy Springs who earlier this year posted a picture of a $1,000 check on Twitter that he would give to anyone who challenged Mainor in next year’s Democratic primary.

He was just as tough on her this past week.

“This was an inevitable result of her narcissism, and many of us saw it coming,” McLaurin said. “Good riddance.”

Mainor veered away from the Democratic Party’s positions on numerous issues earlier this year, particularly in supporting a failed bill that would have allowed $6,500 private school vouchers.

She also backed measures to create a state board to investigate district attorneys, ban COVID-19 vaccination requirements, prevent local governments from passing budgets that “defund” the police and remove bipartisan appointments to a local elections board in South Georgia.

Mainor had previously said she wouldn’t switch parties, saying instead that she hoped to persuade skeptical Democrats to join her stance on education and public safety issues.

Republicans were happy to see her join them.

McKoon saw the switch as an endorsement of the party’s stance “for empowering parents to be advocates for giving their children the best education possible.”

Political expedience

Clyde takes aim at electric vehicles: U.S. Rep. Andrew Clyde has introduced legislation to roll back a proposed rule by the Environmental Protection Agency on emissions that would favor electric vehicles. The Athens Republican told Fox News that EVs “are costly, less efficient and more dependent on Chinese supply chains than traditional gas-powered cars.” Clyde could be headed for a collision with Gov. Brian Kemp’s vision of the state becoming the “electric mobility capital of America” after it persuaded Hyundai and Rivian to build major factories employing thousands in Georgia to produce electric vehicles.
CNBC ranks Georgia No. 4 for business: On the campaign trail, Govs. Brian Kemp and Nathan Deal often touted Georgia’s ranking in a magazine called Site Selection as the No. 1 state to do business. CNBC sees it a little differently. In a new ranking, the business network put the state at fourth in the nation. Actually, Georgia also came in fourth in the South, trailing North Carolina, Tennessee and Virginia on the CNBC list.
Morehouse celebration of Lewis timed with sale of stamp: Morehouse College will play host to an event celebrating the legacy of the late U.S. Rep. John Lewis on Friday, the same day a commemorative stamp honoring the civil rights icon will go on sale. Participants in the event will include Lewis’ son, John-Miles Lewis, and Oscar-nominated actress Alfre Woodard. Pre-orders of the stamp are already underway via the U.S. Postal Service’s website. Stamps will also be sold nationwide, including at the main post office in Atlanta, which will soon bear Lewis’ name.
UGA fund to bear Ralston’s name: The University of Georgia has created a memorial fund to honor the late state House Speaker David Ralston that will support scholarships, summer fellowships and other programs at his alma mater. Joel Wooten, a 1975 graduate of the law school and close friend of Ralston’s, established the fund. The University of Georgia Foundation is providing matching funds. Ralston’s son Matthew said the fund will help recipients “serve the rural parts of the state after receiving a world-class legal education.”