ATLANTA - Georgia lawmakers agreed Friday to a budget that promises sharp cuts but is supposed to avoid unpaid employee furloughs and layoffs in one of the closing acts of the 2020 session of the General Assembly.
The final vote by the House on the $25.9 billion budget passed 104-62, with Democrats again arguing Republicans were overly focused on cuts and weren’t doing enough to maintain or raise tax revenue for needed programs.
House Bill 793 went to Gov. Brian Kemp for his signature with fewer than five days before the 2021 budget year begins on Wednesday.
“In light of the drastic downturn in the economy and the drastic downturn in the revenues, I think we’ve got a much better budget than anybody thought we’d have, you know, a month and a half ago,” the Republican Kemp told reporters Friday.
Universities and K-12 schools will have to set their own budgets now that they know how much they’re getting from the state.
“It’s tough to cut 10%. There’s nothing easy about cutting 10% out of the budget,” House Appropriations Committee Chairman Terry England, an Auburn Republican, told representatives.
The cuts are deep, but had once been projected to be as high as 14%. Kemp let lawmakers spend $250 million out of the state’s savings account and increased projected tobacco tax revenue by $50 million earlier this week. That and an improving economic outlook led to smaller reductions.
“If there’s ever been a time to use the rainy day fund, it is right now,” Kemp said.
Combined with $15.1 billion in federal money and $11.4 billion in non-tax revenue, Georgia’s government plans to spend a total of $52.5 billion.
Kemp had to revise his revenue estimate, which sets a ceiling on what lawmakers can spend, after state revenues tumbled during the COVID-19 pandemic.
England said the cuts were necessary because of the decline in revenues, noting the downturn happened in just a few months, compared to the multi-year budget agony of the Great Recession more than a decade ago.
“It was necessary when $2 billion, or $2.5 billion, disappeared out of the revenue stream almost overnight,” he said.
Lawmakers have been considering proposals to increase revenue, including eliminating hundreds of millions in tax breaks and increasing taxes on cigarettes. There are also last-minute efforts to expand gambling. But none of those measures have passed even one legislative chamber and Republican budget writers said they included none of those plans.
Budget writers say they have found enough money to train new state troopers, avoid cutting aid to county health departments, and spend $19 million to pay for six months of Medicaid health insurance for indigent mothers after birth, up from two. They also say there’s enough money for the Department of Public Health and Georgia’s child welfare agencies to fill some vacant positions instead of eliminating every unfilled job. There are no cuts to the Department of Labor, which is struggling against a tide of unemployment claims.
There’s still a $900 million cut to the state’s K-12 funding formula, although budget writers will pay for the state’s share of enrollment growth, yearly teacher pay raises, running school buses and aid to school districts that don’t have much valuable property to tax.
Lawmakers are urging school districts to spend savings they have built up in recent years to avoid cutting teacher pay or instructional days. England said Georgia’s 180 public school districts hold $3.3 billion in reserves, although some of that money is restricted.
“Our school superintendents realized they had been caught short and realized they could do better,” England said, praising the reserve buildup.