Examples abound and are everywhere visible even if few citizens appear able to connect the dots that create a single picture. The state government is increasingly held together with baling wire and chewing gum even as some parts and services and functions and facilities have completely fallen off.
The billions the lottery brings in are suddenly insufficient to fully fund the HOPE scholarship as promised because the state constantly reduces support levels given to higher education, thus forcing colleges to raise tuition to plug the gap. The $4 billion Georgia is getting in tobacco settlement money that was supposed to go to anti-smoking education and cancer research is now instead used to defray Medicaid expenses. And so forth.
Against that background it is hardly a surprise that cities and counties, being comparatively nickeled and dimed to death by this diversion trick, have formed a united front to try to stop some of this from continuing. They are going to push for a constitutional amendment to block fees being assessed for specific purposes and then dumped into the state’s general fund instead.
The result has been that supposed improvements to be paid for in this manner — teen-driver education, hazardous and solid-waste cleanups, police training and indigent defense — either never are done or city/county taxpayers have to figure out how to accomplish such mandates from existing local taxes or by figuring out how to squeeze more revenue drops out of stony-faced hometown constituents.
AND THAT doesn’t even count the unknown impact of coming shifting state sands such at next year’s whopping increases in car-title fees that will go to the state, to replace the smaller fees plus sales-tax share that local governments receive. The state promises it will return sufficient money to make counties whole. If that’s anything like the theory that our motor-fuel taxes will come back ... ouch!
Citizens should wish the Georgia Municipal Association and the Association County Commissioners of Georgia good luck in this effort — and also start worrying about getting more than they might wish for if the effort is successful. Such an amendment almost passed the General Assembly in the last session, so there is sentiment in support of it. However, there’s no way the state would give up any penny it is now using for purposes different than intended without at the same time replacing it.
While a massive and fundamental state tax restructuring has long obviously been needed — remember the big task force of a few years back that came up with a general plan now nowhere to be seen? — legislative leaders have already expressed reluctance to tinker with taxes this coming year. With much yet unknown regarding the same issue on the federal level this is understandable. When politics trumps sound governance the idea is to be positioned to blame others for anything viewed as negative rather than be blamed.
Oh sure, the General Assembly may again try to pick up loose change from isolated victims without much political clout or organization, such as smokers and the long-pushed $1 a pack cigarette increase.
AT THE SAME time, the ACCG suggested — quite properly — that the state should review its current 110 exemptions in the state tax codes to see if any of the current $2 billion a year in revenue being foregone can be retrieved. The chance of that is fat, meaning slim. Those exemptions largely go to organized special interests with political clout and loyal voting blocs.
As for the group’s other suggestion — a sales tax on services to expand the revenue base and help relieve the load on property taxes — ACCG is plainly thinking of the LOST, or local-option penny ride-on to the four-cent state levy on goods and products. If the LOST could be doubled to two cents, with property taxes strongly impacted downward, that might be worth considering. However, the state does not rely on property taxes. In exchange for this it would demand “its share” or four cents on the dollar upon services rendered.
As a fix for local revenue source limitations (the state has made it largely impossible for communities to have an income tax) such a shift might be worth a look. As a state-level bonanza that is four times what cities/counties would receive that is quite another … even before bringing up the issue of what the legislators would “exempt.” For example, given how many lawyers there are down there such a surcharge on lawyer fees seems dubious.
More worrisome still, if this approach is considered how’s about being honest about it? That’s not a tax on a “sale” but rather on a labor performed or a skill applied. Even if the provider doesn’t pay the new levy, it is still a skim off his/her income-generating ability with the certain outcome of raising the price of the service and perhaps lowering the demand for it. Unlike goods, skills largely have no manufacturing/wholesale/retail structure — no factory outlet price, or warehouse price, or store price for something like having a cancer removed or oil changed or tax-return prepared.
THAT MEANS this would be an entirely new type of taxation, a new foot in the door of the taxpayer’s wallet. Such should always be approached with immense caution.
Nonetheless, if Georgia’s cities and counties don’t soon gain some relief from the state’s revenue highwaymen the cumulative impact on either or both of local taxes or service losses will soon become unbearable.
Additionally, it is important to recognize that what cities/counties are enduring is actually only a portion — and a relatively small one — of an overall state pattern of much less than straight-forward bookkeeping that makes it almost impossible for citizen/auditors to figure out what is going on.
It is also a very sad commentary upon the state government’s competence, attitudes and disposition to note the obvious: No constitutional amendment should be necessary to make state legislators/bureaucrats do what they promised to do in approving legislation or setting policy or spending tax revenues.
If they were true to their word, nothing like this would even have to be contemplated.