Georgia’s state economist is warning lawmakers that a recession could drive down state tax collections in coming months, while Gov. Brian Kemp is again portraying his budget as a way to spur further economic growth.
Speaking to lawmakers by video from Davos, Switzerland, where he is attending the World Economic Forum, the Republican governor on Tuesday told a joint House-Senate meeting of budget writers that Georgia should use its accumulated surplus to pay down debt while cutting taxes and boosting employee pay. He also touted his proposal to invest in transportation projects.
“Our fiscally conservative approach has served us well,” Kemp said. “And as a result, we have the opportunity to make an unprecedented investment in our state while at the same time enacting the largest tax cut in state history.”
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Kemp wants to allot $1.5 billion in cash to the Georgia Department of Transportation before June 30 to speed planned roadwork and establish a freight infrastructure program. Of that money, $200 million would go to cities and counties, increasing what the state sends local governments to maintain their own roads and bridges. He also wants to pay cash for other construction projects and spend $500 million to pay down debt in one of the state’s employee pension funds.
Public school teachers would get a $2,500 raise beginning July 1, in addition to a $1,000 bonus that Kemp sent out in December. State and public university employees would get a 4% raise on top of their $1,000 bonuses.
The governor also touted his support for speeding up a state income tax, which is projected to cost $1.1 billion in foregone revenue.
“Because we chose the smart, fiscally conservative path, we’re returning money to the people while meeting all of our liabilities,” Kemp said. “And we need to stay on that path, or else we risk going the way of these failed blue states.”
Kemp’s administration predicts that tax revenue for the current…
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