Republicans enter the 2009 session of the Georgia General Assembly still in the majority, but with

two less members than the previous session.

After two contentious sessions, Republicans in the House have been promised a “kinder and
gentler Speaker” who has promised to turn policy making decisions over to the House caucus, as
opposed to leadership driving the agenda.

Democrats, after what can be considered a successful election, will be much more partisan than
in recent sessions. It may also make them friendlier to our party’s agenda in regards to ballot
access reform, especially given the results of the US Senate race.

Immediate Legislative Issues

Budget and Spending: Georgia has one of the worst budget shortfalls in the nation, currently
sitting at $2 billion in the red. Legislators will amend the FY 2009 budget to cut spending to
current budget forecasts. The FY 2010 budget will likely be around $22 billion, though I’ve heard
that House leaders want to go as low as $18 or $19 billion. However, the Governor sets the
budget based on revenue projections.

Appropriators are seriously considering giving up Local Assistance Grants (LAGs), the
Assembly’s version of earmarks, presumably until the economy improves and revenues pick back
up. Although LAGs are a small portion of the budget and they are certainly not the only examples
of pork, they represent the wasteful spending and vote buying that is rampant in the legislature.

Taxes: It’s appropriate for taxes to come behind the budget because with the current budget
shortfall there will be a push for at least one tax increase. Privately, Gov. Perdue is being pushed
for an increase in taxes by different departments and agencies within state government. It is
possible Perdue could push a tax increase in the same manner as the $752 million tax increase
in 2003 (ie. increased taxes on cigarettes and alcohol and fees). Support for a tax increase isn’t
there inside his party, but the Governor could increase the state’s portion of the property tax
without legislative approval.

State Rep. Ron Stephens introduced legislation last year to increase the sales tax on cigarettes
by $1. It went nowhere, but it could resurface with support from Democrats if shortfalls arise in
PeachCare funding. If this arises, so would a debate over Certificate of Need. It’s a fight
Republicans have avoided, but may ultimately have to address if revenue and funding problems
continue.

A proposal to freeze property taxes and adjust increases to inflation will be presented by the
Speaker. It is likely to pass and be signed by Gov. Perdue. However, the Governor has withheld
funding for and has pushed for a repeal of the Homeowner Tax Relief Grant which was part of the
FY 2009 budget. House leaders have rejected this move, but may look for cover if forced by the
economy.

Legislation may also be introduced to stabilize the gas tax. The current formula sets the gas tax
st st
on two different dates during the year, January 1 and July 1 . The higher gas prices go, the
higher the gas tax.

Everything depends on whether our current economic carries over to next year and through the
legislative session.

Transportation: This issue goes almost hand-in-hand with the tax issue. The Georgia
Department of Transportation has what is perceived to be a long-term funding shortfall of $100
billion. The reason I say it is perceived as a funding shortfall is because GDOT is inefficient,
wasteful and overly political. Despite some reasonable attempts by Commissioner Gena Evans to
prioritize road projects, there is almost no hope for GDOT.

House and Senate leaders have expressed support T-SPLOST that would be dedicated for
transportation projects for counties in a specific region. This proposal cleared the House in the
final hours on Sine Die in 2008, but was rejected by three votes in the Senate after Lt. Gov.
Casey Cagle and the Speaker clashed over tax reform.

The original proposal, introduced by State Rep. Vance Smith, was a 1-cent sales tax that would
be implemented statewide for ten years and would bring in $22.2 billion. That would have been
the largest tax increase in state history. It was scrapped over objections raised by legislators from
South Georgia.

The proposal passed in House created regions where counties could join into the potential T-
SPLOST. The catch is that there were only two ways to defeat the proposal. Either a county’s
Board of Commission would need to decide not to enter into it or it would have to be defeated in a
collective vote by the counties with the question on the ballot. One county defeating the proposal
is not enough to kill it or to avoid participation in the county voting it down.

The proposal, a constitutional amendment and separate statutory legislation, is being pushed
very hard by the rentseeking business community and very likely to pass this year.

TADs: A constitutional amendment was passed this year that allows for Tax Allocation
Districts or TADs. School boards are allowed to use property ad-velorum taxes to buy bonds for
re-development of property or improvements to infrastructure, such as the Atlanta Beltline.

Supporters of the proposal use Atlantic Station as an example of TAD use. They rarely mention
that the bonds were purchased through an AIG subsidiary, whose financial problems are well
documented, and property values have dropped by over 15%, meaning that the taxpayers are
losing money off the “investment.”

TADs could also reignite the threat of eminent domain, which will be discussed later, due to
weaknesses in the constitutional amendment passed in 2006.

There has also been discussion of regional TADs, which would be setup similar to the T-
SPLOST.

Secondary Issues

Ballot Access & Runoffs: Legislation can and should be introduced to ease ballot access
requirements. As in the past, movement through the legislature will be tough. Some legislators
have been open to the idea. It may be possible to slide in as part of a larger package dealing with
election law.

Legislation will be introduced to eliminate the 50%+1 requirement for a candidate to win an
election, presidential elections excluded. This was pushed through the House in 2007, but was
stalled in the Senate on Sine Die.

Secretary of State Karen Handel opposes the change in the threshold to be elected to office,
however, final approval rests with Gov. Perdue.

No-Knock Warrants: This was taken up in the last session. Legislation was introduced by Sen.
Vincent Fort (D). A somewhat watered-down version was passed in the Senate, but died in the
House.
Incrementalism is the best policy on this issue. Members of the General Assembly, especially
Republicans, like to give off the perception that they are “tough on crime.” If so much as an inch is
given, we should take it.

Eminent Domain: Two years after the passage of the constitutional amendment to protect
Georgians from the threat of eminent domain, the potential for abuse still exists because of the
wording of the amendment. It points to “general law” to define “public use.” The definition of
“public use” can be changed by a simple majority vote anytime the legislature is in session. Given
the business climate in the state, the potential for abuse is real and should continue to be
addressed.

What Can We Do?

The Libertarian Party of Georgia has a unique opportunity to address these issues and more
during the 2009 legislative session, especially if the contentious relationship between Perdue,
Richardson and Cagle continues to spill over into the public.

We must put as much pressure as we can on legislative leaders to cut wasteful spending out of
the budget and demand responsibility, accountability and prioritization inside the Georgia
Department of Transportation.

There are studies and tools available to present viable alternatives to tax increases and so-called
“smart-growth” policies. We should take advantage of these tools from organizations like the
Reason Foundation, Cato Institute, among others and issue weekly or twice weekly press
releases highlighting the issues brought forward during the legislative session and engaging in
the issues and challenging legislative leaders to do something other than raise taxes or involve
government in some other aspect of our lives that they deem as “fixing” some problem that may
or may not really exist.

Report prepared and submitted by Jason Pye, Legislative Director, Libertarian Party of Georgia.