Welfare Watch - May 11, 2009 - Governor Vetoes HB 481

Everyone loves tax breaks but sometimes they just do not make sense.  This is the finding of the Governor with HB 481 that offered a tax credit to companies that hire the unemployed (oxymoron) but added a late amendment to cut the state's capital gains tax in half.  Governor Perdue did not see the wisdom in doing that.  He said, "Unlike the federal government, who can run a deficit, Georgia is a balance-budget state and we cannot run a deficit." 

Supporters of HB 481 argued that the bill would have stimulated the economy by creating jobs and spending.  The facts as expressed by the State's own fiscal note stated the opposite.  There would be a significant lost of state revenue.  By their estimate, the total loss of revenue would approach $800 million over the next several years. 

In light of March and April revenue numbers, Governor Perdue did the prudent action.  His review of the April numbers indicated that they were not encouraging.  This was an understatement.  The April numbers for  revenue collections for the month (FY09) totaled $1,399,047,000 compared to $1,761,180,000 for April 2008 (FY08).  This is a decrease of $362,133,000 or 20.6 percent.  The percentage decrease year-to-date for FY09 compared to FY08 is 9.5 percent. 

Further cuts to the budget could be forthcoming if the revenue of the State does not meet the estimates projected by the Governor.  Vulnerable citizens of Georgia took significant cuts in the FY10 budget.  Some included:

The action of the Governor was courageous in light of the delight and pleasure that all of us get from receiving a tax cut and the pressure placed on him by those who would like to see a tax cut.  A balanced budget and meeting the needs of Georgia's citizens are more important and we praise him for this courageous act of leadership. 

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 Welfare Watch, an email newsletter of the
Georgia Association of Homes
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                            Normer Adams, Editor
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