Revenue Growth Leaves Ga. Budget With Possible ‘Wiggle Room’ | WABE 90.1 FM

Revenue Growth Leaves Ga. Budget With Possible ‘Wiggle Room’

Jan 11, 2016

Georgia lawmakers head into the 2016 legislative session Monday with stronger growth in revenues than in recent years, which could mean a chance for the state to catch up from the recession, experts say. 

“I think things are, at long last, looking pretty good,” said Carolyn Bourdeaux, director of the Center for State and Local Finance at Georgia State University. “The state has been through a really long, tough period.”

According to Georgia's Department of Revenue, tax revenues were up 7.5 percent in November 2015, compared to the year before. Bourdeaux said good revenue growth means Georgia lawmakers will have some space this year to restore some of the funding that was cut during the recession. 

“At last, they have wiggle room to make policy changes as opposed to just treading water,” she said. 

There’s now some room, for example, for substantial pay increases for state employees or getting rid of the state’s “austerity” education cut, she said. 

But it isn't time to "re-gild the Dome," Bourdeaux said, as the state still has a ways to go to catch up to pre-recession levels. On a real per capita basis, tax and fee revenues are still 14 percent below the 2001 peak, according to the Center for State and Local Finance.    

The current revenue growth is a start for the state to draw closer to where it was before the recession, said State Rep. Terry England, chairman of the House Appropriations Committee.

“It does mean that we’re able to start catching up on things that, for several years, we’ve had to put off,” England said.

He said state employee salaries had be put on ice for the last seven to eight years, and the state's been losing good employees to the private industry. Last year, the legislature approved a budget that gave state agencies funding for a 1 percent pay increase for employees. 

"It's certainly one of our goals in the General Assembly as well to see if there's something we can do to actually make a difference," he said. 

England said, still, it’ll probably take a couple of more years to try to get state service-levels closer to what they were like before the Great Recession. He said the revenue growth gives the state a chance now to continue replenishing its reserve fund in case of another economic downturn. 

Gov. Nathan Deal is expected to outline his priorities in the State of the State address Wednesday, and is scheduled to hold a budget briefing Thursday.