Legislative Updates

The Georgia General Assembly ended its 2009 session at midnight on Friday, April 3rd, and many of the bills of interest to our members came to the wire for passage. Overall, it was a good session for Georgia Business, and there are many people to thank. First, we appreciate the Senators and Representatives who were willing to listen, to introduce business friendly legislation, and to work to push meaningful bills across the finish line.

State Budget:
House and Senate leaders came to an agreement on an $18.6 billion budget for Fiscal Year 2010 that reduces the size of the state government without creating new taxes.

Transportation:
In the waning hours of the 40th day a conference committee on transportation funding met a numerous times. Senate conferees were Senate Transportation Chairman Jeff Mullis, Senator John Wiles, and Senator Kasim Reed. The House conferees include House Transportation Chairman Vance Smith, Rep. Donna Sheldon, and Rep. Calvin Smyre. Ultimately, the conferees were not able to come to an agreement and the transportation funding push died at about 11:15 PM on Day 40. Unfortunately, Marta Funding failed to pass because of this deadlock. The passage of legislation would have eased on how the transit system can use revenue. There is talk that Marta may stop service of Fridays due to financial
problems.

The House passed HB277 and HR206 (sponsored by House Transportation Chairman Vance Smith, R), proposing a statewide 1% sales tax to fund transportation improvements in Georgia. This proposal would raise approximately $22 billion, and contains a long list of projects across the state of Georgia that would be eligible to be funded by those new dollars.

SB200 -Transforming Transportation Investment Act; create State Transportation Agency; definitions; purposes; abolish State Road/Tollway Authority: The bill, once over a hundred pages long, was whittled down to around twenty, DOT board members will continue to be elected, but the governor and legislators will have
much more influence over project funding and prioritization. The legislation which will dramatically change the way transportation projects are planned, funded and constructed was passed by both chambers. The bill provides for a new director of planning, appointed by the Governor, and gives the legislature a greater role in choosing which projects will be built. We believe sound governance is critical to our state's future transportation success and commends Governor Perdue, Lieutenant Governor Cagle and Speaker Richardson for their leadership on this important issue.

Economic Development:
HB481- Jobs, Opportunity, and Business Success Act of 2009; enact House Bill 481 makes several changes in our code to provide tax relief and encourage employment opportunities and business stimulation, and was passed in the final hours of the General Assembly.

The JOBS Act of 2009, introduced by Representative Tom Graves and shepherded in the Senate by Senator Chip Rogers, passed on both chambers and provides numerous incentives for business such as elimination of the state inventory tax, creation of tax credits for employees hired, a temporary suspension of filing fees for new businesses and a 50% reduction in the capital gains tax. The legislation will also provide a one year waiver of certain Secretary of State filing fees for corporations, limited partnerships, and LLCs which will be effective from
July 1, 2009 through June 30, 2010. This bill will be signed into law by Governor Perdue.

The existing BEST act was revised to include expanded tax credits for job creation
and retraining, research and development, imports and exports through Georgia ports, and a reduction in capital gains taxes. The legislation also provides for a "mega tax" credit for significant investment in Georgia.

Education:
HB 280 -New math and science teachers, which Georgia is experiencing a shortage currently, will be paid at the same rate as fifth-year teachers as a result of the passage of HB280, sponsored by Representative Brooks Coleman.

Trauma Care:
HB160 , sponsored by Representative Jim Cole and supported by Governor Perdue, will increase fines for "super speeders", providing an estimated $23
million annually to address the state's trauma care needs.

Small Business:
Another last minute bill SB82 which finally crossed the goal around 11:35 pm. The
bill seeks to combat the problem of metal theft by tightening regulations related to the purchase of scrap metal. The bill requires that a photo ID must be presented when selling scrap metal and the recycler must retain a photocopy of the ID. Aluminum forms and copper items, cash payments can only be made after a 24 hour wait. SB 82 also allows for prosecutors to consider the value of the stolen property in its undamaged condition rather than just its value as scrap.

Tax:
After this fiscal year, the homeowner's tax relief grant will no longer be funded.
Legislation to double the homeowner's exemption failed. Attempts to end the corporate income tax and the annual ad valorum tax on cars also failed.

HB46 - Off Road Diesel Fuel Sales tax Suspension: This bill formally ratifies the Governor's suspension of the sales tax on off-road fuel which became effective last May. However, the suspension is about to expire, depending on when the Governor signs the bill. The bill was amended to end the suspension at the end of the month in which the bill is signed, but no later than May 31, 2009. A late amendment could cut the deadline to April 30 if the Governor signs the legislation this month. Should he wait until May1 or later, the sales tax exemption would run until May31 as intended. Either way, it is on the Governor's desk. We went to the
Governor's office and asked that the bill not be signed until May 1st to keep the additional month exemption.

HB318 - Motor vehicles; place of return for tax purposes; change certain provisions: Lawmakers cleared this bill late Friday after some adjustments were made to the section dealing with a limited heavy equipment ad valorem tax exemption. The original concept of the bill was to allow farm vehicles to be registered and taxed in the county where they are located, as opposed to the county where the owner claims homestead exemption. We appreciate House Ag Chairman Tom McCall for his leadership on this legislation. This legislation was amended to exempt ad valorem taxes on heavy equipment that is: 1) not licensed for highway use; 2) limits the deduction to $100,000 on ad valorem taxes in 2010; 3) is limited to individuals and not publicly traded companies; and 4) includes mining and construction eEquipment. Due to the efforts of Senator Chip
Pearson and Rep. Tom McCall this bill passed in the waning minutes of the General Assembly. There were really only two lobbyists that helped pass this legislation over the opposition of the General Municipal Association. We hope the Governor will sign this legislation that will financially help many of our contractors.

SB55 - Ad Valorem Taxation; change factors to be considered in determining fair market value of real property: This bill by Senator Chip Pearson adds foreclosure, net taxable value declarations from real estate transfers, and decreased value from conservation easements into the criteria for tax assessors to consider for fair market value property assessments. It also extends the signup deadline for the Forest Land Protection Act from April 1 to June 1.

Environmental:
HB207- Off Road Vehicles: This bill makes it illegal to operate an off road vehicle in any navigable or non-navigable stream unless directly crossing it. Current code includes farm exemptions and the revision adds "other vehicles used exclusively for agricultural purposes."

HR471 and SR433 - Oppose Clean Water Act Expansion: These similar resolutions urge Congress to oppose expansion of the federal Clean Water Act. An expansion of CWA would grant the EPA and the Army Corps of Engineers jurisdiction over all waters within the states as well as all activities affecting these waters, public and private. As urging resolutions, they have no force of law, but rather express the will of the Georgia General Assembly to the Georgia Congressional delegation.

SB155 - Soil Erosion and Sedimentation; 25 foot buffers along state waters; change certain provisions: This bill by Senator Chip Pearson reached the finish line this week as the minor changes made last week were agreed to by the Senate. If signed into law, this bill will clearly articulate that 25 foot buffers for wet weather ditches are not required.

SR667 -Diesel Engines: This resolution creates a Senate study committee to evaluate the impacts and feasibility of retrofitting diesel engines.

Energy:
HB473 - Clean Energy Grant Program: This legislation sets up a clean energy grant program administered by GEFA, if and only if, federal appropriations are provided to GEFA. Currently, GEFA receives approximately $1 million annually from the Dept. of Energy under its State Energy Program (SEP); GEFA is estimated to receive approximately $80 million for SEP through the stimulus bill. The grant program applies to commercial installations under the same terms and conditions of the current law. The applicant can not apply for both the grant and the state income tax credit. Therefore, commercial investors in clean energy property will most likely choose the grant options in lieu of the tax credit option.