Mike Klein Online

Georgia Legislature Passes FY 2013 Budget by Wide Margins

Mike Klein

Georgia legislators overwhelmingly approved next year’s budget early Tuesday afternoon, just one day after they voted to pass significant pension investment reform.

Next year’s $19.342 billion budget that passed both chambers Tuesday is 5 percent higher than $18.2 billion current fiscal year funding.  Governor Nathan Deal’s office recently increased the revenue estimate by $177 million.  “While this is positive affirmation that we are recovering slowly, it should be understood that this growth does not begin to regain all the lost ground from our high water mark in Fiscal 2008,” said House appropriations chair Terry England.

“At that point (during fiscal year 2008) our budget was some $2 billion larger than it is today with a half million less people.  In fact, the fiscal year 2013 base budget proposes state operations at 20 percent lower per capita than one decade ago,” England said.

The fiscal year begins July 1.  The new budget has a strong economic development focus with $44 million in new One Georgia Authority funds and $67 million for REBA – Regional Economic Business Assistance – primarily from Georgia’s receipts from the national mortgage settlement.

Senate appropriations chair Jack Hill told the chamber those funds will “front-load our economic development efforts.  If we have the opportunity to bring in new industry nothing will stop us from the standpoint of a new rail spur or a new road, whatever is needed for that community and the state to bring new jobs to Georgia.”

The House voted 143 – 24 and the Senate voted 45 – 0.  The bill contains no across-the-board state employee salary increases, except for some increases for Georgia Bureau of Investigation agents and Department of Natural Resources rangers.  The bill fully funds pre-K salaries and operating expenses for 170 days; there was concern earlier in the session that pre-K teacher salaries were addressed but operating expenses were overlooked.

Significant public sector pension reform was approved on Monday when the House passed SB 402 by a 104 – 53 margin.  The bill allows for the allocation of up to 5 percent of Employee Retirement System assets into alternative investments such as venture capital funds. The state Teachers Retirement System is exempt.  The bill does not require any specific alternative investment; it merely establishes the framework and defines the investments.

The budget that will be sent by Governor Deal would restore funding to the Morehouse and Mercer University Schools of Medicine.  It would also expand new physician residency slots statewide, restore $4.3 million for substance abuse programs, add $1.2 million for GBI scientists who conduct drug tests and fund new judges in the Bell-Forsyth and Piedmont judicial circuits. Ten million dollars is provided to fund accountability courts as part of criminal justice reform.

Other highlights include funds to open a new trade office in China; $108 million in bonds for the Technical College System, $75 million for reservoir development, and $29.8 million to comply with the federal court agreement on behavioral health programs.  Autism treatment funds would be allocated for the Marcus Center, Emory University and a facility in Savannah.

The Plains and Sylvania welcome centers would remain open.  The budget also restores funds that were in jeopardy for cooperative extension county offices and 4-H programs.

Click here to read the budget legislation tracking sheet.

Click here to read the final budget legislation.

Click here to read the pension reform bill.

(Mike Klein is Editor at the Georgia Public Policy Foundation)

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March 27, 2012 - Posted by | Uncategorized | , , ,

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