Will Parents or Politicians Decide Georgia Charter Schools Future?
Mike Klein
Last week’s State Capitol hearing about whether voters should be allowed to decide school choice in Georgia had nearly concluded when this final question was posed: In the event that no constitutional amendment is passed, and no other action is taken by the General Assembly, would the state be unable to intervene in any local school board decisions that are deemed to be harmful to children?
The answer in a moment, but first here is some perspective. Georgia thought it decided one aspect of school choice four years ago when the General Assembly created a charter schools commission, but last spring the state Supreme Court ruled the commission unconstitutional in a 4-to-3 opinion. That vote has placed literally thousands of students in jeopardy; they could lose their charter schools.
Georgia Cyber Academy is the state’s largest blended learning charter; it has 10,000 students who live in all but two of the state’s 159 counties. In theory, Georgia Cyber could be forced to apply for individual charters from every county. Currently, the Cyber Academy is operating as a state special school.
Ivy Preparatory Academy recently had its 2012 charter request rejected by the Gwinnett County local board. The Fulton County local school board rejected Fulton Science Academy, which received a 2011 National Blue Ribbon School Award from the U.S. Department of Department of Education. Ivy Prep and Fulton Science would need state special school charters to open again next fall.
House Speaker Pro Tem Jan Jones
House Resolution 1162 seeks to reinstate the state’s ability to authorize charter schools, and it would also create a vehicle to direct state funds to support those students. The chief sponsor for HR 1162 is House Speaker Pro Tem Jan Jones, who also was chief sponsor of the charter school bill four years ago.
Last Thursday Jones told a near overflow committee hearing room that the state has 29,000 students in startup charter schools, a pittance among the 1.6 million total public school pupils statewide. “To say we want that kind of framework is simply not to be in support of charter schools,” Jones said. Click here to view the House TV video archive.
The proposed constitutional amendment has adamant supporters and opponents. Supporters must gain two-thirds approval in both the Senate and House to get the amendment onto the November ballot. Opponents can prevail if HR 1162 comes up just one vote shy in the Senate or House, meaning voters would not get to decide this school choice question in Georgia.
As to the question that began this discussion – what might happen if no action is taken – here was the powerful response from House Majority Whip Ed Lindsey who also is a co-sponsor of HR 1162:
“Quite frankly, we worked very hard with a lot of legal scholars who said (charter schools commission legislation) was constitutional. Three justices agreed with us and one of them wrote a damn fine 75-page minority decision that I ask all of you to read,” Lindsey said.
“The fact of the matter is, what’s contained in that decision needs to make anyone who is concerned about any of the state reform packages that we’ve passed, or any of these state initiatives that we have, including teacher pay scales and everything else, it better give you pause because the language is expansive. The language does say that basically our job is to write a check and shut up, and I’m not even sure that we should be writing a check.
“You may have some very distinguished attorneys out there who say, oh, it’s not that broad, it only applies narrowly. Well, folks, I’m here to tell you, we had an awful lot of good legal scholars who told us four years ago that HB 881 was perfectly constitutional.
House Majority Whip Ed Lindsey
“The best way not to have to deal with that issue is to pass this constitutional amendment. I’ve had some folks tell me, well, let’s just pass legislation and try to fix what the Supreme Court says. Well, here’s the problem. You’re going to end up with three more years of litigation before the case gets back to the Supreme Court and then we find out again,” Lindsey said.
“And in that meantime, we’re going to spend three years with different organizations around the state, different parents around the state not certain whether the charter school they are sending their children to is constitutional in terms of the funding as opposed to clearing that up right now.
“I’ve been a litigator for 27 years. This is a piece of advice I give to all my clients. The best lawsuit is one that we don’t have to file because we come up with some a resolution to avoid a case. You’re only in court because you have no other alternative,” Lindsey said.
Lindsey held up the HR 1162 resolution. “This or some version that we come up with because we work our way through it together, is the alternative to paying a lot of lawyers on both sides a lot of money and leaving children and their parents uncertain for three years. To do the alternative is, my opinion, irresponsible.”
Organizations that testified in favor of HR 1162 include the Council for an Educated Georgia, Georgia Chamber of Commerce, 100 Dads, Georgia Charter Schools Association, and the Georgia chapter of the Students First organization. Organizations that opposed the bill include the Professional Association of Georgia Educators, Georgia School Boards Association, Georgia School Superintendents Association, and the Georgia Education Coalition.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
Tax Foundation: Georgia 34th for Best Business Tax Climate
Mike Klein
This morning the conservative Tax Foundation released its comprehensive analysis of state tax structure policies that impact business growth. The message for Georgia: We Can Do Better. Georgia is ranked No. 34 nationally, unchanged from one year ago. Georgia lawmakers continue to struggle with how to enact comprehensive revenue neutral tax reform.
The Tax Foundation annual report compares states against each other in five tax categories: corporate, personal income, sales, unemployment insurance and personal property. Georgia collects all five; some states do not. With no personal income tax, Florida ranked fifth nationally. Three states have no personal or corporate income taxes. Some states impose no sales tax.
The Tax Foundation wrote, “The lesson is simple: a state that raises sufficient revenue without one of the major taxes will, all things being equal, have an advantage over those states that levy every tax in the state tax collector’s arsenal.” The Foundation ranked Georgia ninth best for corporate income tax, 12th for general sales tax, 22nd for unemployment insurance tax paid by employers, 39th for personal property tax and 40th for individual income tax.
The Tax Foundation said ten southern states rank ahead of Georgia: Florida (5), Texas (9), Tennessee (14), Missouri (15), Mississippi (17), Alabama (20), Kentucky (22), West Virginia (23), Virginia (26) and Louisiana (32). (By virtual of editorial discretion Missouri is included here because next year it plays Big Boy Football in the Southeastern Conference.) Only South Carolina (36) and North Carolina (44) finished lower than Georgia among southern states.
It would be somewhat surprising if the General Assembly does not agree this year to eliminate the sales tax on energy used in manufacturing. All the momentum is in that direction. Governor Nathan Deal made it a priority. He also wants sales and use tax exemptions for construction materials used in what the Governor has described as “projects of regional significance.”
Much less clear is whether the Georgia Legislature can agree on changes to general sales and personal income taxes, which likely would be tied in a revenue neutral conversation. The state unemployment taxes structure is perhaps the thorniest briar in the patch.
Georgia has borrowed $721 million from Washington since December 2009 to help pay monthly unemployment benefits. Some perspective on that number; Georgia’s emergency fund is $328 million, less than half the amount owed to the federal government. This year Georgia will also make a $33 million interest payment that will not reduce the principal amount.
Unemployment insurance benefits are funded by taxes on employers. States set tax rates and they determine the maximum taxable wage base. Georgia’s maximum tax rate is tied for lowest in the country and the wage base is almost lowest in the country. More taxes paid by Georgia businesses and reduced unemployment benefits are both possible this year.
The Tax Foundation said last year the index was downloaded 487,000 times, cited in hundreds of news reports and mentioned by four governors in their State of the State addresses. Here is a link to the 2012 Tax Foundation business tax climate index report.
Georgia Tech: “This Time We Are In the Room”
Michael Meyer, Georgia Tech School of Civil and Environmental Engineering
Georgia Tech’s Michael Meyer was understandably still pretty excited when we spoke this week while he attends a conference in Washington, D.C. Meyer will coordinate the Georgia – Florida – Alabama, ten-university national transportation research center housed at Tech’s School of Civil and Environmental Engineering.
“I’ve been at Georgia Tech for 23 years. When we won the (regional) transportation center four years ago, that was a foot in the door to let folks know we really are good at what we do,” Meyer said. “This time we are in the room. I’m at this conference and everyone up here is basically saying, Georgia Tech was the big winner.”
The $7 million public-private partnership brings together seven Georgia universities plus two from Florida and one from Alabama. The project focus will be on transportation infrastructure, safety and economic development from more than just a local perspective. That means best business practices to reduce fatalities, how to evaluate infrastructure priorities and much more.
Meyer posed his own questions: “How do we define success. Is it the amount of vehicles or people who can be handled? Is it the level of satisfaction or the level of dissatisfaction? What we have to offer is a national and international perspective on what has worked or not worked elsewhere.” Atlanta HOT lanes – subject of recent debate – will be on the table for review.
Meyer said the immediate challenge will be coordinating researchers from the ten universities and designing their unique projects. He noted Georgia State has an expertise in finance while the two Florida schools – Central Florida and Florida International – are noted for research into how people respond when they use driving simulators. The project is funded for two years with half from a federal grant and half in matching funds. The Woodruff Foundation stepped up with $300,000. “Woodruff was a fantastic shot in the arm,” Meyer said.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
HOPE Should Not Become Just Another Government Spending Program
Mike Klein
HOPE, Again: About those reports that the HOPE scholarship could face a new economic tsunami because so many Georgia kids are qualifying for the full tuition Zell Miller Scholarship: Really? Are these kids nothing like the 50 percent who lose HOPE after one school year? And if we suddenly have so many super smart kids, why do our national test scores still suffer?
New proposals are already being floated to address HOPE financial stability one year after the General Assembly thought it had bought the scholarship program some time. While all those numbers are being crunched, perhaps someone should look at why more than half lose the scholarship after one year, two-thirds after two years and nearly three-fourths after three years.
HOPE matters. But HOPE should not become just another government spending program.
Congratulations: Georgia Virtual School science department chair Asherrie Yisrael has been selected as a finalist for National Online Teacher of the Year. The award has two sponsoring entities: the Southern Regional Education Board and the International Association for K-12 Online Learning.
Asherrie Yisrael, National Online Teacher of the Year Finalist
Yisrael was honored as the 2010 – 2011 Georgia Virtual School Teacher of the Year. Her specialties are advanced placement physics, forensic science and physical science. Georgia Virtual School (GAVS) is the state Department of Education online learning program resource. It has about 10,000 students who select online courses from a broad-based curriculum.
Thirty-nine online teachers from 26 states were nominated for the SREB – iNACOL award. The winner will be announced on March 1 during SREB’s virtual learning conference in Atlanta. Other finalists are Leslie Fetzer from North Carolina and Tracey Seiler from South Carolina.
SREB and iNACOL established the national online teacher award two years ago. Yisrael is the second Georgia teacher nominated. Gabrielle Bray of Gwinnett County was nominated in 2010.
School Choice Rally: It’s looking like at least 1,500 will rally for School Choice outside the State Capitol at 10:00am Wednesday. And perhaps the weather will cooperate — mild and partly cloudy!
Georgia legislators will address alternate authorization for charter schools during the current General Assembly. The latest negative headlines include Gwinnett County again turning down a charter for Ivy Preparatory Academy whose students have an outstanding academic record, and Fulton County’s rejection of the Fulton Science Academy which was named a 2011 National Blue Ribbon School Award recipient by the U.S. Department of Education.
The Americans for Prosperity Georgia chapter will present screenings of its new film “Making The Grade in Georgia” hourly start at 2:00pm in the Georgia Room of the Twin Towers office building directly across the street from the State Capitol. Here is a link with more information.
Georgia Tax Climate: Wednesday morning the conservative Tax Foundation will release its 2012 business climate index that measures how states compare in five categories: corporate tax, personal income tax, sales tax, unemployment insurance tax and property tax. Data is based on tax policies as they existed last July 1 when most states began their new fiscal years.
The Tax Foundation ranking is not against any specific baseline. States can move up or down even if they make no changes because revisions in other states can affect overall rankings.
The Tax Foundation ranked Georgia No. 34 nationally last year. Foundation economists found 33 states with overall better business tax climates and 16 that were worse. Georgia tax reform remains a work in progress this year after the 2011 Legislature was unable to enact reform.
Unemployment insurance tax gets less attention than it deserves. Georgia began to borrow federal funds starting in December 2009 because the state could no longer afford to write unemployment benefit checks. Georgia owes $721 million in principal plus tens of millions of dollars in annual interest. Options to find repayment dollars include imposing higher taxes on employers and reducing benefits, which could mean fewer weeks, smaller checks or both.
The Tax Foundation business tax climate index will be released at 10:00am Wednesday.
Yellow Jackets 1, Volunteers 0: Friday’s announcement that Georgia Tech will become a national tier one university transportation research center means the state made a better case than our nearest northern neighbor. Tennessee would have located a national think tank at the Center for Transportation Research on the University of Tennessee campus in Knoxville.
Governor Nathan Deal announced Georgia’s plan to pursue the transportation research center initiative last May when he addressed the state Logistics Summit in Atlanta. Georgia Tech will coordinate research by seven state universities plus three in Alabama and Florida. Tech was also named to participate in a regional initiative coordinated by the University of Florida.
Here’s a salute to the Woodruff Foundation that provided essential local startup seed money. The total investment for two years will be $7 million with half from the federal government.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
The Whale in the Room: Federal Health Care Reform
Mike Klein
There was a whale in the room Thursday morning at the State Capitol.
THE PATIENT PROTECTION AND AFFORDABLE CARE ACT.
Community Health commissioner David Cook had nearly finished his hour-long budget testimony when a question came from the floor: In years ahead, what is the expected fiscal impact of federal health care reform? “The 2014 budget is going to be a whale,” Cook said. “We’re going to have to be prepared to answer a lot of questions. Where we come up with the money is going to be a challenge.”
Cook said new projections are the ACA will cost $2.5 billion additional dollars between 2014 and 2019, and up to $5 billion between 2019 and 2023. “As the Act becomes more mature, there is less and less federal money to support it,” Cook said. “The biggest part of the Affordable Care Act is the expansion of the Medicaid population. We estimate 650,000 additional people. We’ve got 1.7 million now.”
Georgia’s $7.8 billion annual Medicaid budget is a combination of state and federal funds. Medicaid payments cost the state $11.5 million per day. Fifty-nine percent of Georgia births are Medicaid babies. Some 1.7 million Georgians use Medicaid. The good news – always look for any good news – is Cook said the state 5.2 percent Medicaid annual growth rate is less than the 7.3 percent national growth rate.
Georgia is among more than two dozen states that filed suit to overturn the Affordable Care Act. The U.S. Supreme Court will hear arguments this spring and a summer opinion is anticipated.
The State Health Benefit Plan is the other big business model at Community Health. SHBP is actually three plans to cover state employees, teachers and non-certified school personnel. The program faced several hundred million dollars of deficits over Fiscal 2012 and 2013, but Cook said changes that include higher premiums and the elimination of some medical options have significantly pared down the deficit.
“Today our State Health Benefit Plan is on a better financial footing,” Cook said. He said changes were considered essential for Georgia to maintain its triple AAA bond rating.
Thursday morning’s third and final day of annual budget hearings focused heavily on social service and health care agencies. Human Services commissioner Clyde Reese told legislators the state expects to lose $37 million next year in federal support for Temporary Assistance to Needy Families, welfare. “We’ve been told that money is going to go away,” Reese said. He also said the state food stamp caseload is up 52 percent since 2007, with some 1.65 million active food stamp assistance recipients.
State Office of Planning and Budget Director Debbie Dlugolenski said the Governor’s Office will continue to ask state agencies for budget cuts going forward, even in years when revenue improves.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
Governor Deal Defends $19.2 Million Budget During Capitol Hearing
Mike Klein
Governor Nathan Deal opened three days of House-Senate appropriations hearings by taking exception to media reports that suggest his budget is a significant spending increase.
Deal proposed a $19.2 million Fiscal 2013 budget, up from $18.3 million this year. Increases would fully fund anticipated K-12 enrollment growth, required pension and the state employee health care benefit obligations, improve Medicaid funding and enable the state to purchase new prison beds “for those who truly need to be locked up,” the Governor said.
“Other than funding these areas of growth, my budget calls for funding increases of three-tenths of 1 percent,” Deal told assembled legislators at the State Capitol, “not the figure that you have seen in some of the media reports.” Deal added $4.2 million to support residency slots for physicians, $10 million for One Georgia rural economic development, $10 million for accountability courts and $3.7 million for school nurses.
The Governor said 14,000 state positions were taken off the books since last year and the total state workforce is down 7.7 percent since 2001 to about 96,800 employees. “When adjusted for inflation per capita spending in my budget recommendation for fiscal year 2013 is 20 and one-half percent less than Fiscal Year 2002,” Deal said. “In that same time period state population grew by approximately 1.5 million. Therefore, we are providing more services with fewer resources.”
Governor Nathan Deal
The State Personnel Administration would be phased out under Deal’s 2013 budget with its staff and resources transferred to other state agencies. There would be sweeping changes at the Department of Labor. DOL state funds would be reduced by $23.3 million and many services would be transferred to other agencies. Deal has also proposed selling state fixed wing aircraft and transferring Georgia Aviation Authority budget, staff and resources to other agencies.
“There are no new taxes being proposed and this is small government that is focused on doing the things that government is expected to do and to do them well,” Deal told legislators.
Using phrases like “relatively good news for a change” Georgia state fiscal economist Kenneth Heaghney testified that recovery to pre-recession levels is still three years away, the state housing industry is still weak and Europe could be a big drain on the U.S. and Georgia economies for years to come.
Heaghney presented a mixed but overall an upbeat report. “All in all, the news has been good,” the Georgia State University economist told the Senate-House Joint Appropriations Committee. “The outlook is positive. We do expect the economy to strengthen.” He said state monthly tax revenues have been consistently stronger and that trend is expected to continue.
State Economist Kenneth Heaghney
Heaghney said several factors will determine the pace of recovery. “Consumers are still trying to adjust to declines in their housing wealth and their equity wealth. We see Europe probably falling into recession,” he said. “China’s growth is slowing so there is a slowdown in the overall global economy. There are still headwinds and we expect the recovery to be improving but still not the kind of robust growth we’ve seen coming out of other recessions.”
Heaghney said the national economy ended last year with upticks in GDP growth and lower jobless claims along with improvement in manufacturing, professional and business services, education and health care sectors. He said the U.S. broader national economy was resilient despite oil price instability, European and U.S. debt crises and the Japanese earthquake.
Heaghney predicted state government revenue will not return to pre-recession levels until Fiscal 2015. Here is what he said about the state housing downturn: “It’s really tough to find any good news in Georgia.” Heaghney said real estate values declined 3 percent nationally last year but 12 percent in Atlanta. “That suggests that probably distressed sales are making up a bigger portion of the market.” Heaghney predicted bank foreclosures will increase going forward.
Despite those realities, Georgia continues to demonstrate slow but steady economic growth. State government month-to-month revenue increased for 18 straight months until last month when it posted a decline because of unusually high December 2010 corporate audit payments. Fiscal year revenue is up 5.2 percent with an expectation that it will continue to improve.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
At Least One Republican Supports Health Insurance Exchange
Mike Klein
Republicans seem almost united that the General Assembly should not consider legislation this session to create a health insurance exchange. “The House, the Senate and the Governor have all agreed to wait on that,” Sen. Renee Unterman said Thursday morning.
Well, united with at least one exception. Former lawmaker and second-year Insurance Commissioner Ralph Hudgens said, “I would like to see the legislature move forward with an exchange,” when he sat next to Unterman at “Health Care Unscrambled” hosted by Georgians for a Healthy Future. Think of it as “Eggs and Aspirin” under dim lighting at the Freight Depot.
“Wait on that” means wait for this summer’s hotly anticipated U.S. Supreme Court opinion that will decide whether the federal health care reform law survives a constitutional challenge. Unterman started a spirited conversation that was the highlight of the morning conference.
“I was dismayed to hear, as you just heard, the Senator (Unterman) say there will be no health exchange legislation this year,” Democratic Sen. Nan Orrock said moments later. “We are headed for a cliff. There are those who oppose (the Affordable Care Act) and those who are for it. I am for it. We move forward when we can bring different ends of the political spectrum together. We’re missing the boat to keep kicking the ball down the field.”
Orrock found an apparent insurance exchange soul mate in commissioner Hudgens who said, “I don’t want the federal government setting up an exchange in Georgia. I want Georgia setting up an exchange for Georgia. I don’t think moving forward with an exchange is giving tacit approval to the Affordable Care Act. I’m just telling you where I stand.”
Orrick: “Mr. Commissioner, I vote with you on that. That exactly makes my point.” Hudgens: “Well, that’s rare, isn’t it!” As politicians of different political feathers, Orrock and Hudgens agreed that they seldom agree but on this issue, both said Georgia should move toward implementation of a health insurance exchange.
If upheld by the Supreme Court, the health care reform law requires that states must create health insurance exchanges before 2014 or the federal government will impose an exchange.
The National Conference on State Legislatures maintains a comprehensive website that says 13 states have enacted exchange laws. Nineteen states including Georgia considered but did not pass legislation. Bills are pending in five states and the District of Columbia.
Governor Nathan Deal did not discuss health insurance exchanges Tuesday during his State of the State address. Last month an advisory committee created by the General Assembly said Georgia should establish a health insurance marketplace authority, but it did not call for 2012 legislation. Cindy Zeldin, who is executive director of Georgians for a Healthy Future, wrote the committee minority report that recommended moving forward with an exchange now.
“Georgia has an unprecedented opportunity to address our high rate of uninsurance by developing a health insurance exchange for individual consumers,” Zeldin wrote. “Federal dollars and resources are on the table to help us craft a Georgia solution. We should seize this opportunity.” Nearly two million Georgia residents have no health insurance.
Georgians for a Healthy Future unveiled a seven-point legislative agenda that includes trying to plug an insurance hole created by federal health care reform. Health insurance policies written only for children have dried up in the state’s insurance marketplace.
“This is a market in which parents would buy a health insurance plan for their child but not themselves,” Zeldin told the Public Policy Foundation. “It might happen if the parent has a plan at work but is not offered dependent coverage, or if they cannot afford a family policy.”
Zeldin said companies pulled out of the child only market after health care reform mandated that they could not deny coverage to children because of pre-existing conditions. Zeldin said her organization and others have been trying to identify the number of children affected in Georgia.
“We would like to follow the footsteps of several other states that have addressed this issue by passing legislation requiring insurance companies” to offer child only coverage, Zeldin said. Colorado passed a bill for that purpose.
There may be bipartisan support. Conference panelist Rep. Richard Smith, who is Republican chair of the House Insurance Committee, cited stand alone child policies and giving Georgians the right to purchase health insurance across state lines as two possible priorities for the 2012 General Assembly.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
Governor Deal Proposes $700 Million Bonds Package
Mike Klein
Governor Nathan Deal’s Fiscal 2013 proposed budget includes $700 million in new bonded projects with $235 million for the University System, $177 million for the state Board of Education and $55 million for the Technical College System. The overall bonds package is larger than $563 million proposed by the Governor last year.
The largest pieces of the University System bonds package are $59 million to design and construct an engineered biosystems building at Georgia Tech; $52.3 million for a new veterinary medical learning center at the University of Georgia; $35 million for general improvements; $28 million for a medical education commons at the Georgia Health Sciences University in Augusta; and, $25.2 million for a new health building at Georgia Gwinnett College.
Other pieces inside the University System bonds package include $8 million for the Georgia Research Alliance to purchase equipment and fund research and development infrastructure in Atlanta, Athens and Augusta. The Georgia Building Authority would receive $24.4 million to purchase Fort McPherson property from the federal government and a separate $4 million package to retrofit the Fort McPherson Reserve Command building for eventual state use.
The Governor recommended a Georgia Public Broadcasting $3.48 million bonds package; $1.78 million for communications and information system upgrades, and $1.7 million for roof replacement and cooling system upgrades. GPB is attached to the University System for budgetary purposes.
Bonds projects at the Department of Education include $25 million to purchase 320 school buses, $9.4 million for vocational equipment and $4.7 million for improvements at multiple locations. The rest of DOE’s $177 million package is described as statewide capital outlays.
Most of the Technical College System $55 million is facilities repairs – there are lots of roofs, heating and air conditioning systems on the horizon. A new training center would be constructed for $14 million.
Governor Nathan Deal
Deal announced $46.7 million in bonds for the Savannah River harbor deepening project during his Georgia Chamber of Commerce and State of the State addresses on Tuesday. Georgia and folks up north in South Carolina are vying for federal dollars to deepen harbors because larger ships will begin to pass through the Panama Canal in just two years. Savannah and Charleston are not ready to handle larger ships.
The Department of Community Affairs would get $25 million for water supply projects. The Department of Economic Development would get $18.37 million in bonds for the Georgia World Congress Center to acquire land and make renovations. The Governor proposed $15.26 million for the Department of Natural Resources for repairs, renovations and land acquisition for wildlife management areas and parks.
Justice and public safety agencies would receive $14.3 million for the Corrections to replace 187 motor vehicles; make facilities repairs and enhance cell phone interdiction measures statewide; $8.7 million for repairs and improvements at the Department of Juvenile Justice; and, $8.5 million for Public Safety to replace 100 State Patrol cars, two helicopters and also to make repairs and renovations.
Elsewhere in Governor Deal’s proposed budget:
Year-to-year general revenue is estimated to increase from $18.55 billion current year to $19.22 billion next year. Most of that increase is anticipated growth from individual income tax revenue, plus some improvement from general sales and use tax revenues.
Health care expenses continue to grow. Medicaid and PeachCare are funded at $252 million. The breakdown is $159.8 million for existing enrollment, $68 million for anticipated new enrollment and $19 million to offset a reduction in federal contributions. The Governor’s Office estimates that 21,000 children of state employees will become newly eligible for PeachCare.
More than $33 million in state funds would be set aside to pay interest to the federal government on a $721 million loan Georgia took to help pay unemployment compensation benefits during the recession. The Governor’s Office Emergency Fund would appropriate $27.2 million and the remainder would come from within the Department of Labor’s state-funded budget. The interest payment is due September 30 and it would not reduce the full principal also owed back to Washington.
State-funded dollars for the Department of Labor would be significantly reduced from $37.7 million to $14.4 million, which reflects the transfer of some responsibilities to other state agencies. Federal dollars used to pay unemployment compensation benefits are the largest portion of the state DOL budget.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
Georgia Public Broadcasting Gets Zero-Based Budget Review
Mike Klein
Georgia Public Broadcasting was named in Governor Nathan Deal’s 2013 proposed budget as one of 35 programs that will participate in zero-based budget reviews. GPB is the only state authority whose name shows up in the zero-based budget review category. During his Tuesday evening State of the State address the Governor said 10 percent of all state programs would move to zero-based budgets.
Popularly known as GPB-TV and GPB Radio, the official name is Georgia Public Telecommunications Commission. The state public broadcaster is attached to the University System Board of Regents for budget purposes. Governor Deal’s 2013 proposed budget would give GPB a very slight budget trim to $12.3 million in state dollars, less than the two percent average reduction at other agencies, but still millions of dollars below the agency’s high water mark during pre-recession year budgets.
Governor Deal’s summary of zero based budget reviews is divided into five categories that were originally conceived under the now defunct Commission for a New Georgia: Educated Georgia, Healthy Georgia, Safe Georgia, Best Managed State and Growing Georgia.
The Governor’s proposed budget was published Wednesday morning. It states, “The purpose of the Zero Based Budgeting review is to assess a program against its statutory responsibilities, purpose, cost to provide services, and outcomes achieved. Ten percent of programs are examined each year, including a thorough evaluation of the activities and services provided by the program, the performance measures demonstrating program outcomes and effectiveness, and program spending trends. The total recommended reduction to the programs shown above is $8,890,376.”
Educated Georgia programs that identified for zero-based budget reviews include child care services at the Department of Early Care and Learning, technology and career education at the Department of Education, the central office at the Board of Regents and departmental administration at the Technical College System.
Healthy Georgia programs include adult forensic services at Behavioral Health and Developmental Disabilities, health care access and improvement at Community Health; adoption services and elder community living services at Human Services; the state trauma care network commission at Public Health and the state Veterans Memorial Cemetery at Veterans Services.
Safe Georgia programs include departmental administration and probation supervision at Corrections; youth education services at Defense; the criminal justice information system at the Georgia Bureau of Investigation; the youth detention centers secure commitment program at Juvenile Justice; and, the public safety training centers program at Public Safety.
Many programs were identified in the Best Managed State category, including state purchasing at the Department of Administrative Services. Three Governor’s Office programs were also named: the Governor’s Office for Children and Families, the Office of Student Achievement and the Office of Consumer Protection. Four programs were selected at the State Personnel Administration including system administration and workforce development and alignment.
Also in the Best Managed State category, the Department of Labor business enterprise program will undergo a zero-based budget review as will the archives program at the Secretary of State’s office
Growing Georgia programs include marketing and promotion at Agriculture, tourism at Economic Development and airport aid at Transportation.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
There Was Lots to Like About Deal’s State of the State Address
Mike Klein
Governor Nathan Deal looked to the stars for guidance Tuesday evening as he delivered his second State of the State address before the General Assembly in Atlanta. During a 42-minute address the Governor from Gainesville described his goal to achieve another world class medical college in Georgia, announced millions of new dollars for public education, threw a lifeline to former state commission charter schools, and he put his stamp firmly onto corrections reform. Before doing that, Deal turned to the stars.
“Georgians have charged us to set a course for our state and they have defined the stars that we must follow to expand opportunity; the star of education – we must provide great schools that will cultivate the minds of our young people – the star of transportation – we must provide safe roads and avenues of commerce – the star of security – we must give every Georgian the ability to live in a safe community – and the guiding star in our constellation, jobs – we must create a business climate that provides Georgians with their best shot at a good job! These are the stars on which our eyes must be focused as we chart the course for our great state!”
Deal said revenue stabilization – Georgia has 19 consecutive months of improved state revenue – will enable his Fiscal 2013 budget to increase K-12 schools funds by $146 million, increase technical schools and colleges funds by $11.3 million, increase school nurses funds by $3.7 million, and increase teacher salaries by $55.8 million based on training and experience.
As expected, Governor Deal also announced an increase in the number of pre-K school year days next year to 170 days, a ten-day improvement over this year. Deal said there would be no reductions to the QBE funding formula, equalization grants or other enrollment driven programs.
He announced a new reading program for young pupils. “Students must learn to read in order to be able to read to learn and when we fail to invest in our youngest students, we are forced to spend money on remediation for the remainder of their academic careers,” the Governor said. “To this end, my budget includes $1.6 million for a reading mentors program.”
Governor Nathan Deal (File Photo)
Deal answered a big question about fall 2012 funding for charter schools that were affected by last spring’s Supreme Court decision that overturned the state charter schools commission. He will ask for $8.7 million in supplemental grants to help those schools stay open next year.
The Governor added, “This is not the long-term solution, and I look forward to working with you to ensure that charter schools can thrive in Georgia. We can do this and with your help we will.” The General Assembly is expected to consider ideas that would enable the state to become an alternate authorizer of schools that do not seek or cannot obtain a local school system charter.
On higher education, Deal came out firmly in support of a proposed consolidation of several state colleges. The Governor described consolidation as “doing more with less.” About medical education, he said, “Georgians deserve a world-class, public medical university and it will be a priority of this administration to have a medical college among the top 50 nationally.”
Deal said Georgia Health Sciences University in Augusta will seek to become the state’s second National Cancer Institute designated Cancer Center, alongside the Winship Cancer Center at Emory University. “Georgia’s annual death rate from cancer exceeds the national average,” Deal said “but I believe we have all of the ingredients necessary to be a destination for cancer research and a resource for every family battling this disease.” Georgia will invest $5 million toward that goal.
“In order to address the need for additional health professionals in Georgia, we have been investing in the expansion of undergraduate medical education for several years,” Deal said. “We must now take the next step in this process by increasing the number of graduate residency slots.” The Governor said his budget will fund 400 new residency positions.
Deal announced “Go Build Georgia” to assist workforce development. Deal said 13 million people are unemployed nationally but employers cannot find qualified personnel for some 1.3 million positions. “Right here in metro Atlanta, Siemens has been unable to fill approximately 200 skilled-trade positions in the fields of manufacturing automation, health care technology, transportation systems and technical services. It is time we begin work to boost our pipeline.”
On transportation, Deal said new southbound lanes will be added to Georgia 400 to alleviate congestion. The Governor said he supports ideas to alleviate Northwest corridor congestion along I-75 and I-575, but not the ideas in a recently abandoned plan. “I was, am and will be opposed to contracting away Georgia’s sovereignty for a period of 60 to 70 years over a transportation corridor that is so vital to our future,” Deal said.
The need to reform the state corrections system was a dominant theme when Deal addressed the General Assembly last year, and he returned to that theme with several announcements: $1.4 million to fund additional parole officers, $32.5 million for new prison beds, and three pre-release centers would be converted to residential substance abuse treatment centers at an initial cost of $5.7 million.
“We must make this investment,” Deal said. “If we fail to treat the addict’s drug addiction, we haven’t taken the first in breaking the cycle of crime – a cycle that destroys lives and wastes taxpayer resources. This is something we can do and with your help we will.”
Deal proposed $10 million in next year’s budget for new drug, DUI, mental health and veterans’ courts. Expanding accountability courts was a key recommendation made by this past year’s special council on criminal justice reform. With a focus on rehabilitating people and closing the revolving door back into prison, Deal asked that the religious community, non-profits and other charitable organizations help former prisoners transition back into the general population.
“Let me be clear so there is no misinterpretation. This is not a get out of jail free card,” Deal said. “These reforms do not in any way diminish the seriousness of the seven deadly sins. If you commit one of these, you will spend time in our prisons. In fact, this transformation of our corrections efforts will ensure that we have the space and resources to incarcerate high-risk and violent offenders going forward.”
The Governor concluded his address by returning to the economic agenda that he discussed during his speech to 2,500 at the Georgia Chamber of Commerce “Eggs and Issues” breakfast.
Deal’s agenda includes repeal of the sales tax on energy, new sales and use tax exemptions for construction materials used in “projects of regional significance,” and updating two jobs tax credit programs. “We will modernize our job tax credits to better incentivize small business growth and to help every Georgia community compete with their regional peers,” Deal said.
As mentioned above, Georgia finances have steadily improved since mid-2009 but the state is far from leaving the forest. Georgia now has a $328 million reserve fund, an increase of 183 percent, but well below more than $1 billion on hand several years ago. With an eye to change how the state manages money, Deal said 10 percent of all programs will begin zero-based budgeting, a process that requires justification for every line item in a budget before it is funded. This idea was considered but never enacted during Governor Sonny Perdue’s administration.
(Mike Klein is Editor at the Georgia Public Policy Foundation)
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