Capitol Recap: Georgia tax collections continue pointing to strong economy

Strong tax collections indicate that Gov. Brian Kemp will be able to fulfill a 2018 campaign promise, just in time for his 2022 campaign for reelection, to raise state educators' pay by $5,000. Kemp got the educators the first $3,000 during his first legislative session as governor. But plans for the remaining $2,000 were put on hold when the General Assembly passed a budget that cut spending during the early days of the COVID-19 pandemic, fearing it would significantly damage the state's economy. (Alyssa Pointer/Atlanta Journal Constitution)

Credit: Alyssa Pointer

Credit: Alyssa Pointer

Strong tax collections indicate that Gov. Brian Kemp will be able to fulfill a 2018 campaign promise, just in time for his 2022 campaign for reelection, to raise state educators' pay by $5,000. Kemp got the educators the first $3,000 during his first legislative session as governor. But plans for the remaining $2,000 were put on hold when the General Assembly passed a budget that cut spending during the early days of the COVID-19 pandemic, fearing it would significantly damage the state's economy. (Alyssa Pointer/Atlanta Journal Constitution)

Continued gains could shape strategies for next year’s elections

Georgia tax collections defied expectations and the delta variant in August, increasing by 12.7% over the same period last year and pointing to continued growth of the state’s economy.

“Everything in modern economics you might as well throw out the window at this point because nothing is making sense,” said longtime state House Appropriations Chairman Terry England, a Republican from Auburn who keeps a sharp eye on Georgia’s economy.

COVID-19 cases and hospitalizations, powered by the delta variant, climbed in August to levels very close to the January surge. The seven-day rolling average for new confirmed and probable cases began the month at 3,021, and it tripled to more than 9,500 before September began.

Similar increases across the country drew blame for the nation’s disappointing jobs report for August.

But Georgia’s revenue growth remained strong. Income tax collections were up 13.9%, and the state’s gross take from the sales tax finished 15.9% over August 2020.

The two taxes are the state’s largest sources of revenue and are generally seen as a strong indicator of the state’s economic health.

The continued gains — following what’s expected to be a huge surplus for fiscal 2021, which ended June 30 — gives Gov. Brian Kemp and legislators a lot to think about as they head into an election year.

A priority for the governor will be fulfilling a campaign promise from 2018 to raise the state’s 100,000 educators’ pay by $5,000. He got $3,000 of that in his first year in office. His plans to get the remaining $2,000 ran into a roadblock when the pandemic hit because state officials expected a recession.

Now, it looks like Kemp has a great opportunity to keep that promise, which would cost the state’s taxpayers about $360 million a year.

Kemp may also consider other voter-friendly ideas, such as raising the scholarship awards given to HOPE students — money that would come from lottery sales — and exempting retirement income from state taxes for ex-military and former first responders, such as paramedics, firefighters and police officers.

The state already exempts some retirement income — such as money from pensions — for Georgians starting at age 62.

Republican lawmakers, if their track record means anything, will also likely push for tax cuts.

Democrats, meanwhile, will continue to back expanding Medicaid to get more Georgians in the public health care program for the poor and disabled, and they will call for a boost in spending on education.

But budget writers, because they are budget writers, will urge legislators to be cautious, warning them that inflation, worker shortages and supply problems could still slow Georgia’s economy.

And don’t count out COVID-19′s chances of dampening consumer spending, especially in a state with a relatively low vaccination rate.

Donald Trump's most recent rally in Georgia was in January in Dalton, when he was campaigning for then-U.S. Sens. Kelly Loeffler and David Perdue. The former president is planning a return to the state Sept. 25 at the Georgia National Fairgrounds in Perry. (Curtis Compton / Curtis.Compton@ajc.com)

Credit: Curtis Compton / curtis.compton@ajc.com

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Credit: Curtis Compton / curtis.compton@ajc.com

Trump plans return to Georgia later this month

He’s a little early, but former President Donald Trump plans to fulfill a campaign promise by returning to Georgia later this month.

“I’ll be here in about a year and a half campaigning against your governor, I guarantee you,” Trump told a crowd in Dalton back in January during a rally supporting the campaigns of then-U.S. Sens. Kelly Loeffler and David Perdue.

Trump vowed then to seek revenge against Gov. Brian Kemp, one of a number of Georgia Republicans that the former president blames for his loss in the state during last year’s election.

The former president plans to headline a rally at the Georgia National Fairgrounds in Perry on Sept. 25, several organizers said. It will be one of a string of political events Trump has mapped out across the nation through his Save America PAC.

The rally will likely feature some stage time for Herschel Walker, state Sen. Burt Jones and U.S. Rep. Jody Hice.

Walker, at Trump’s urging, is running for the U.S. Senate. Jones has launched a bid for lieutenant governor, and Hice is aiming to replace Secretary of State Brad Raffensperger, another Republican who has drawn Trump’s scorn for refusing to help him overturn the results of the 2020 election.

Trump has already endorsed Walker, Jones and Hice.

What’s not clear is whether he will endorse a Republican challenger to Kemp.

So far, he’s fallen short in efforts to persuade Perdue to enter the race or coax any other high-profile Republicans to launch a bid for the Governor’s Mansion.

Some anti-Kemp Republicans are promoting the candidacy of ex-legislator Vernon Jones, who backed Trump during a speech at last year’s Republican National Convention. But the former president, so far, has withheld his blessing for the onetime Democrat, who has opposed numerous GOP policies.

Based on what happened following Trump’s last appearances in Georgia — at the Dalton rally and an earlier campaign gathering in Valdosta leading up to the Senate runoffs — he may want to reshape his message.

Trump used each of those gatherings to focus on his baseless grievances about voting irregularities in November costing him reelection. Hundreds of thousands of Republicans who voted in November didn’t return to the polls in January to vote for Loeffler and Perdue, allowing Democrats to sweep the two Senate seats and gain control of the chamber. The most severe drop-offs were in the regions around Dalton and Valdosta.

Fulton County investigators continue to dig as they try to determine whether then-President Donald Trump violated state laws by trying to overturn the results in Georgia for the presidential election. (Brandon Bell/Getty Images/TNS)

Credit: TNS

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Credit: TNS

Work continues on Fulton investigation into Trump

At least four officials in the Georgia secretary of state’s office have talked to Fulton County investigators who are trying to determine whether then-President Donald Trump violated state laws by trying to overturn the results here for the presidential election.

The Daily Beast reported that, so far, investigators have interviewed office attorney Ryan Germany, communications specialist Ari Schaffer, Chief Operating Officer Gabriel Sterling and Outreach Director Sam Teasley.

District Attorney Fani Willis’ office is focusing on the phone call Trump placed Jan. 2 to Georgia Secretary of State Brad Raffensperger, during which the president urged his fellow Republican to “find” votes to deny Democrat Joe Biden’s win in the state.

Raffensperger has apparently yet to be interviewed.

The website quoted Raffensperger confirming that Fulton investigators have requested documents from his office.

“They’ve talked to some of our folks,” Raffensperger said, “and we’ll cooperate fully.”

The Fulton investigators are also coordinating with federal lawmakers probing the Jan. 6 insurrection at the U.S. Capitol. That could involve sharing documents that could be useful to the state probe, a person with direct knowledge of the discussions told The Daily Beast.

The investigation also could extend to Trump attorney Rudy Giuliani, who promoted lies about election fraud during a state legislative hearing; and U.S. Sen. Lindsey Graham of South Carolina, who was accused by Raffensperger of urging him to toss mail-in ballots in certain counties.

Graham and Giuliani have denied any wrongdoing.

Ruling knocks down restrictions on third-party candidates

It just got a lot easier for third-party candidates to get on the ballot for the U.S. House and other elections in Georgia.

Previously, because of a 1943 state law, petitions to be listed on a ballot by third-party candidates — your Libertarians, your Green Party members and anyone else who wasn’t a Democrat or Republican — required signatures from at least 5% of registered voters.

U.S. District Judge Leigh Martin May has ordered Georgia to reset the bar at 1% of registered voters for third-party candidates running for nonstatewide offices, the same percentage of signatures needed for statewide candidates.

She wrote that her decision “would alleviate the unconstitutional burden” placed on third-party candidates. In contrast, Democrats and Republicans automatically appear on the ballot once they’ve been nominated by their parties.

Under May’s order, third-party candidates will need to submit 4,600 to 6,500 valid signatures — depending on the number of registered voters in a particular district — to run for Congress. That’s a decrease from more than 23,000 signatures previously required.

Up to now, no third-party House candidate has ever collected enough signatures to appear on a Georgia ballot.

May ruled in March that Georgia’s third-party signature requirements were “overbroad” and violated the First and 14th amendments of the U.S. Constitution.

Her newest ruling permanently blocks Secretary of State Brad Raffensperger from enforcing the state’s 5% signature requirement until the General Assembly enacts a permanent measure.

Attorneys for the state have said in court documents that they might appeal the ruling in advance of the 2022 election cycle.

Texan Cruz boasts about work he did with Warnock

Texas Republican U.S. Sen. Ted Cruz is bragging about work he did with Georgia Democratic U.S. Sen. Raphael Warnock.

The two managed to include I-14, a potential connector running from Georgia to Texas, in the latest infrastructure bill.

The Senate voted unanimously to insert the project as an amendment to the Biden administration’s $1.2 trillion infrastructure bill.

Cruz and Warnock co-wrote the amendment.

Cruz told The Houston Chronicle that he and Warnock worked together on the project because they both wanted to create jobs in their home states.

“I’m very proud that we were able to get a big legislative win for the Permian Basin in this time where Washington is so divided with partisan infighting,” Cruz told the Chronicle just before participating in some partisan infighting. “It’s good to see we can get some good things accomplished in addition to all the bad policy that’s being pushed by the current administration.”

Worker shortages persisted after end to federal unemployment subsidy

Georgia and 24 other states saw no bounce in employment figures after they cut short a federal unemployment subsidy for their residents, The Wall Street Journal reports.

In fact, they fell slightly behind the 25 states and the District of Columbia that continued to provide the extra $300 per week in benefits under the program that ended this past week.

The states that maintained the benefits saw nonfarm payrolls rise by 1.37% from April to July, compared with 1.33% for the states that ended the payments early, according to a Journal analysis of U.S. Labor Department data.

Early in the the coronavirus pandemic, the federal government added $600 to weekly jobless benefits. Once that program lapsed, the level of the subsidy varied. But in February, a COVID-19 relief package set the payments at $300 a week.

But in May, governors in many states started announcing that they planned to end or reduce the benefits during the summer. Those governors said the additional money was deterring some of their residents from returning to work, especially those who were receiving more in unemployment benefits than they would have earned on the job.

Kemp halted the extra payments to Georgia residents on June 26 after telling Fox News in May that they were “hurting our productivity not only in Georgia, but around the country.”

But studies at the time showed a mix of reasons for worker shortages. Some people were staying home with their children, and some feared that their jobs would expose them to COVID-19. Others with low incomes saw a financial incentive in delaying their return to the workforce.

Georgia's Fort Gordon is one of 12 U.S. military installations due for a change in name so they will no longer honor generals of the Confederacy. A federal commission involved in the renaming process is seeking suggestions from the public. HYOSUB SHIN/HSHIN@AJC.COM

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Base renaming commission seeks public input

A federal commission has set up a virtual suggestion box to help it play its part in finding new names for military bases that currently honor Confederate generals, including two in Georgia.

The Naming Commission, which will make its recommendations to Congress, is seeking submissions at https://www.thenamingcommission.gov/.

The changes were authorized in the most recent Department of Defense authorization bill.

In all, 12 military institutions are to be renamed, including Fort Benning and Fort Gordon in Georgia.

U.S. Rep. Austin Scott, R-Tifton, is the only member of Congress on the commission.

Candidates, endorsements, etc.:

— U.S. Rep. Jody Hice is throwing his support behind state Rep. Timothy Barr, a Republican from Lawrenceville, to take his seat in the U.S. House. The GOP primary in the 10th Congressional District features a crowded field. Also running are former U.S. Rep. Paul Broun; Mike Collins, whose father, Mac Collins, represented Georgia in Congress; former Georgia Revenue Commissioner David Curry; and Matt Richards, who forged a lucrative career in demolition. Hice is giving up the seat to run for Georgia secretary of state.