Capitol Recap: Top legislators target Georgia’s lucrative film tax credit

Top officials in the General Assembly say they will back a plan to tighten the requirements to obtain Georgia’s film tax credits, among the most lucrative in the country.

Credit: File photo

Credit: File photo

Top officials in the General Assembly say they will back a plan to tighten the requirements to obtain Georgia’s film tax credits, among the most lucrative in the country.

Measure would require bigger investments to qualify for tax break

Some of the General Assembly’s biggest players are looking to tighten the requirements to obtain Georgia’s film tax credits, among the most lucrative in the country.

Lt. Gov. Burt Jones, House Speaker Jon Burns and the heads of the chambers’ two tax-writing committees — Senate Finance Chair Chuck Hufstetler and House Ways and Means Chair Shaw Blackmon — announced the proposal at a Capitol press conference.

Under the proposal, the state would raise the minimum required investment to be eligible for the credit from $500,000 to $1 million.

The most recent state audit to examine the credit — released in December — said the industry will earn $1.35 billion worth of credits this fiscal year, rising to $1.4 billion by 2029.

That same audit said Georgia’s growing film industry creates far fewer jobs than boosters say, and the credit costs taxpayers $59,455 per job.

The film industry counters that it produces about $4.4 billion a year in direct spending in the state, and that 92% of the film work done in Georgia depends on receiving those tax breaks.

A key to the proposal is a cap on how much the filmmakers can sell in credits to individuals seeking a break on their taxes. In its first year, the cap would likely be set at a little more than $900 million.

Sales of the credits are a big boost to the bottom lines of the companies that produce film and television projects in Georgia.

For instance, if a film company spends $3.3 million in Georgia and meets all the necessary state criteria, it can earn a 30% tax credit worth $1 million.

Many of those companies, however, aren’t based in Georgia and owe little or nothing in state taxes. So they sell the credit at a slight discount to a person or company that owes state taxes.

The buyer may pay $900,000 for a $1 million credit. The film company gets $900,000, and the buyer saves $100,000 in taxes.

An aerial photograph shows the construction site of a DataBank facility in Atlanta. A push is underway in the General Assembly to suspend the tax break the state provides for data centers. One reason is that while they are massive in size, they don't employ that many people. (Hyosub Shin / Hyosub.Shin@ajc.com)

Credit: HYOSUB SHIN / AJC

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Credit: HYOSUB SHIN / AJC

Suspension in works for data center tax break

Leaders in the state House and Senate say they will back a suspension of the tax break the state currently awards for data centers.

Georgia has provided lucrative tax savings for large or “hyperscale” data centers since 2018.

The state usually ties its tax breaks to job creation, which doesn’t really apply much to data centers. They’re mammoth in size, but they only employ a few dozen workers.

House Ways and Means Chair Shaw Blackmon, R-Bonaire, said that if the tax exemption is brought back at some point, the House plan would increase the salary requirements for data center jobs to qualify.

The centers also place a great demand on resources, particularly the generation of electricity.

They operate around the clock, consuming huge amounts of power. The state’s largest utility, Georgia Power, says it needs to significantly boost the capacity of its system to keep up with the demand.

The utility has asked state regulators to allow it to add almost 3,400 megawatts of new capacity, equal to about three times the maximum output of one of the new nuclear reactors at Plant Vogtle. Georgia Power executives have testified that data centers are responsible for about 80% of its expected new load.

Microsoft, which operates multiple data centers in Georgia, said incentives are an important factor it considers when planning new facilities. Tax breaks, however, are just one of 35 criteria it takes into account, a company spokesperson said.

The midyear budget that the Georgia House approved this past week include $1.5 billion for road construction. (Hyosub Shin / Hyosub.Shin@ajc.com)

Credit: HYOSUB SHIN / AJC

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Credit: HYOSUB SHIN / AJC

House midyear budget comes into focus, boosting state spending by $5 billion

The House version of the midyear budget took shape this past week, adding $5 billion in spending.

That includes money for a new medical school at the University of Georgia, roads, rural airports, local water and sewer projects, and rural economic development programs.

The boost would bring total spending for fiscal 2024, which ends June 30, to $37.5 billion.

Of that new spending, $2 billion would come out of the state’s undesignated reserves, part of $16 billion that has been socked away after three years of huge surpluses.

For the most part, the budget tracks with the proposals Gov. Brian Kemp produced in January.

Here are some of the biggest tickets in the big-ticket spending:

  • $1.5 billion for road building and maintenance.
  • $500 million to prop up the state’s pension system for retired state workers.
  • $450 million for a new prison in Washington County.
  • $315 million to provide the $1,000 retention bonuses Kemp announced shortly before Christmas for more than 300,000 teachers, school workers and state agency staffers.
  • $100 million to support rural economic development projects.

One wrinkle in this year’s midyear budget is a decision to pay cash for new college buildings, agency facilities and maintenance programs that the state typically funds through borrowing. The Kemp administration projects that to save the state $1.3 billion over 20 years.

The midyear budget is now in the Senate’s hands.

Susan McWethy,  from Decatur, speaks against the use of bar codes and QR codes in vote printouts during a public comment period in 2018. Republicans in the Georgia Senate approved Senate Bill 189 this past week, which would remove QR codes from the state's ballots. The bill is now under consideration in the state House. BOB ANDRES  /BANDRES@AJC.COM

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Republicans advance bill to remove QR codes from Georgia ballots

Georgia Republican senators, in a party-line vote, advanced legislation that would scrub bar codes off ballots.

Under Senate Bill 189, ballot scanners would count votes directly from the ballot text or a machine mark, such as a computer-printed oval filled in with voters’ choices. The text or bubbles would become the official vote rather than the QR code.

It’s unlikely that the change could be made in time for this year’s presidential election.

Supporters of the bill said it would improve election security by reducing the risk of hacks or tampering that could flip votes. There’s no indication that Georgia’s voting machines have been breached during an election, and Secretary of State Brad Raffensperger has repeatedly said the state’s voting system is secure without the change.

Under Georgia’s current system, using technology manufactured by Dominion Voting Systems, in-person voters fill out their ballots on touchscreens, which are attached to printers that create a paper ballot. The ballot displays voters’ choices in text alongside a QR code that is counted by scanning machines.

Democrats said the proposal would be expensive.

The cost of technology changes needed under the proposed system starts at $15 million — possibly growing much higher — to pay for thousands of new ballot printers and election computers across the state. So far, lawmakers haven’t appropriated money in the state budget for replacement election equipment, although the proposed state budget includes $5 million for technology to audit and verify elections without using QR codes.

The Georgia Senate in a party-line vote, with Republicans in favor, approved Senate Bill 344, which would establish a five-day tax holiday on the sale of firearms, ammunition and gun accessories that would be timed with the beginning of the state's hunting season in October. The measure is now under consideration in the state House. (Ethan Miller/Getty Images/TNS)

Credit: TNS

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Credit: TNS

Tax holiday on gun sales gains backing of Senate

The Georgia Senate voted this past week to create a five-day tax holiday for the purchase of firearms, ammunition and other gun accessories.

The tax break would be timed with the first week of hunting season in October.

Senate Bill 344 was approved 30-22 on a party-line vote, with Republicans supporting the measure.

The bill’s sponsor, state Sen. Jason Anavitarte, R-Dallas, initially sought an 11-day tax holiday that he said would have cost the state between $1.3 million and $3.3 million. He did not provide updated numbers on the shorter time window.

During the holiday, the sales tax would be suspended for sales of guns, ammunition, gun safes, trigger locks and accessories, such as scopes and magazines. It would operate much like a tax holiday the state used to offer several years ago on school supplies, which the General Assembly didn’t renew.

Democratic state Sen. Jason Esteves of Atlanta said the tax break “is not about hunting, it’s about politics.”

“Ultimately, what this is intended to do is to score political points at the expense of Georgia families,” he said.

The House will now consider SB 344.

Final approval given to bill expanding on offenses requiring cash bail for release

The state House gave final approval to a bill that would add dozens of misdemeanor and felony offenses to the list of charges that make cash bail a requirement for release.

Senate Bill 63′s sponsor, state Sen. Randy Robertson, a Cataula Republican and former Muscogee County sheriff’s deputy, said the bill aims to ensure that people who have been arrested and released on bond return for their trial. It would add low-level crimes such as trespassing and failure to appear for a traffic citation on the second offense to the list of violations that require bail.

The bill is a departure from efforts across the country over the past decade to move away from requiring people arrested on certain nonviolent misdemeanor charges to pay money to bond out of jail. Some criminal justice advocates say it is unfair for people to end up staying in jail for long periods only because they are unable to pay a cash bond.

Georgia was once a leader in that movement.

When Republican Nathan Deal was governor, he put much of his effort into overhauling the criminal justice system by focusing primarily on steering more nonviolent offenders from prison cells to treatment centers.

During Deal’s final legislative session as governor in 2018, lawmakers in both chambers of the General Assembly voted unanimously to require judges to consider a defendant’s financial status when setting bail and allow law enforcement officers to issue citations instead of filing criminal charges for low-level offenses.

Many of the same legislators who voted for that measure backed Robertson’s bill.

SB 63 now heads to Gov. Brian Kemp’s desk for his signature.

The American Civil Liberties Union of Georgia has pledged a court challenge if Kemp signs the bill into law.

Vice President Kamala Harris made her third visit to Georgia in the past two months when she was in Savannah this week to make a campaign appeal to support abortion rights. (Arvin Temkar/arvin.temkar@ajc.com)

Credit: Arvin Temkar/AJC

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Credit: Arvin Temkar/AJC

VP, first lady visit Georgia as presidential campaign gets in gear

Officials from the Biden administration have been piling up the frequent-flier miles to Georgia.

Vice President Kamala Harris was in Savannah on Tuesday to make an appeal in support of abortion rights as part of a campaign tour taking her to states that have increased restrictions on the procedure since Roe v. Wade was overturned in 2022.

She used the opportunity to label former President Donald Trump “the architect of this health care crisis” because he appointed three Supreme Court justices who voted to repeal Roe.

It was Harris’ third visit to the state Georgia in the past two months.

A day after Harris’ stop in Savannah, first lady Jill Biden traveled to Atlanta to speak about women’s health at the Morehouse School of Medicine.

As the presidential campaign heats up, more visits are likely in one of the few true battleground states in the contest. Biden won Georgia in 2020, defeating Trump by fewer than 12,000 votes.

Campaign finance reports reveal strengths and weaknesses for candidates

The campaign trail ahead for Cobb County Commissioner Jerica Richardson is a steep one in her bid for the U.S. House.

Her opponent in the 6th Congressional District’s Democratic primary, U.S. Rep. Lucy McBath, carries a significant edge in name recognition.

Advertising offers a way to combat that, but McBath also holds a huge advantage in fundraising.

The Marietta congresswoman, who is seeking the seat after she was drawn out of her district for the second time in two years, has $1 million stashed in her campaign war chest.

Richardson’s campaign finance report shows she has $3,515.35 in her account, along with $3,000 in debt.

Campaign finance reports also show:

  • U.S. Sen. Raphael Warnock, more than a year after he defeated Republican Herschel Walker, has stockpiled $5.2 million, even though he is not up for election again until 2028.
  • U.S. Sen. Jon Ossoff, who could face Gov. Brian Kemp when he runs for reelection in 2026, has about $3.2 million in cash on hand.
  • Lt. Gov. Burt Jones, a potential candidate for governor in 2026, has collected more than $1.8 million since winning election to Georgia’s No. 2 job in 2022. Jones took in money through his campaign and his leadership committee, a fundraising mechanism that the GOP-led General Assembly created in 2021 to allow certain officials, candidates and groups to raise and spend unlimited amounts of cash, even while the Legislature is in session.
  • U.S. Rep. Rich McCormick has about $390,000 in his account. The first-term Republican from Suwanee is now, after redistricting, in a safe district for Republicans, but the GOP primary is potentially a problem for him. McCormick could draw a Donald Trump-backed challenger after he initially endorsed Florida Gov. Ron DeSantis over the former president in this year’s run for the White House.

Political expedience

  • Voter deadline: Monday is the last day to register to vote in Georgia’s March 12 presidential primary. Voters can check their registration status and view sample ballots through the state’s My Voter Page at mvp.sos.ga.gov. Eligible Georgians can register online, and registration forms are available at libraries, post offices and county election offices. Early voting begins Feb. 19.
  • Discussion on democracy: Some big names will participate in a roundtable discussion on American democracy that the American Bar Association has scheduled for Feb. 13 at the State Bar of Georgia. They include former federal Judge Michael Luttig, a conservative who says former President Donald Trump should be disqualified from running again for the White House; former U.S. Secretary of Homeland Security Jeh Johnson; and Carly Fiorina, a longtime corporate executive and one-time presidential contender.


Capitol Recap: The 2024 Legislative Session

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