Explainer: When Georgia lawmakers do — and don’t — know the cost of their votes
By Maggie Lee
In an hourslong Gold Dome debate over how Georgia should replace its generation-old computer voting system, the cost kept coming up, with figures on two sides of a chasm. About like the divide between Democrats and Republicans on the issue.
But Georgia legislators often don’t have a nonpartisan official estimate of what their votes will mean for the state’s finances.
Take this voting machine case. Pretty much everybody agrees that Georgia needs to get rid of its paperless voting machines. Democrats, broadly, want hand-marked paper ballots. Republicans broadly supported the bill that’s now on Republican Gov. Brian Kemp’s desk: House Bill 316 would have the state buy new touch-screen machines that print voters’ choices to a piece of paper. The voter would review that paper and hand it in for tabulation.
Kemp’s draft budget for the year beginning in July would borrow $150 million via 20-year bond to buy such machines and train poll workers to use them. There will also be ongoing costs for software updates and maintenance.
Democrats, fighting the bill, said their preference would cost more like $30 million. Though that doesn’t count what it would cost counties to print paper ballots.
Democrats said Georgians don’t know the ongoing cost of the Republicans’ plan, and demanded a “fiscal note.”
A typical “fiscal note” is an official, nonpartisan estimate of what a piece of legislation would cost the state, generally for a few years out. The notes are signed by the State Auditor’s office and the state Office of Planning and Budget, though some of the work is farmed out to Georgia State University.
The nice thing about a fiscal note is that all sides consider it at least a good-faith estimate, free of industry or partisan spin. People who write fiscal notes aren’t trying to score points or win votes.
By law, a fiscal note is required for bills that have a “significant impact on the anticipated revenue or expenditure level” of any part of state government.
But that word “significant” isn’t defined. And there’s a lot of discretion left to chamber leaders or committee chairs, who are mostly Republicans, on whether to require or ask for a note. And “local” impact notes, which would add up the cost of a new state law to the counties that have to carry it out, are rare.
In the case of voting machines, House Speaker David Ralston, R-Blue Ridge, said HB 316 doesn’t require a fiscal note, saying it’s a capital expenditure and a specific item in the budget. (The budget itself starts months before the session, with evaluations over in the executive branch; and it’s the topic of dozens of hearings.)
So there is no official, nonpartisan estimate on ongoing cost of anybody’s voting scenario to the state or counties. And that goes for a lot of bills in the Legislature.
Fiscal notes can also cover the opposite of spending money — they can lay out the costs of cutting taxes or of tax breaks.
For example, a bill this year would extend a tax break that airlines get on jet fuel. Delta would be the biggest beneficiary.
If the state were collecting that tax, it would be worth something like $40 million per year to the state’s general fund by 2024, according to the fiscal note.
After they’re enacted, tax breaks also get tracked some.
For example, Georgia’s marquee income tax credit for film-making has been expanded several times since its modest beginning in 2005.
If Georgia collected those taxes, it would be worth $474 million this for the year that begins in July, according to the 199-page latest Georgia Tax Expenditure Report.
So then, another question is whether Georgia gets a good deal for forgiving those taxes.
Every year, lobbyists for those who make films, repair yachts, operate locomotives or any of a bunch of other industries come and make the same argument: that if their own industry could get a lower tax bill, the benefits to the public or the economy would be greater than the taxes lost.
You hear the phrase that these tax breaks don’t take a piece out of the pie — they “make the pie bigger.”
Maybe tax breaks do pay off; and maybe they don’t. But the state doesn’t make a systematic effort to check.
A pair of state Senate bills would set up a review of the business case for tax breaks.
The bills “make sure we measure those adequately at the beginning as well as on the back end,” said state Sen. John Albers, R-Alpharetta, presenting his legislation in committee late last month.
There’s similar language in both his bills: set up an “economic analysis” of each tax incentive. Do the analysis before the tax break gets a vote, and do a similar review periodically afterward.
Auditors would need to figure out how the incentive changes state revenue, state expenses, economic activity and public benefit.
In other words, nonpartisan auditors who are not representing any industry would need to ask: did a tax break linked to yacht repair attract so many broken yachts to the state that Georgia’s got a new, robust industry where it didn’t before? Is a tax break for restoring old buildings a good value in terms of the public good of preserving Georgia heritage? Could the money foregone be better used in another way?
A study committee Albers chaired in 2017 did look at six tax incentives and exemptions, as sort of a pilot program. Some, of the incentives he said, were extremely beneficial. And some weren’t. Some didn’t even have any takers. Legislators repealed three last year.
It now remains to be seen if the state House takes them up.
Fiscal notes are posted here and sometimes on a bill’s legis.ga.gov page. Make sure there’s a match between the “LC” version numbers on the fiscal note and in the top-right corner of the bill.
Report from the 2017 state Senate Study Committee on Special Tax Exemption