Sen. Loudermilk's 'Taxpayer Relief Act' Carries Over to 2014

Although the "Taxpayer Relief Act" sponsored by Sen. Barry Loudermilk (R-Cassville) to encourage fiscally responsible state spending didn't pass during the recently adjourned legislative session, it will be up for consideration in the 2014 session.

“SR 594 places on the 2014 general election ballot, an amendment to the State Constitution that would limit future government spending based on the increase in population and the rate of inflation. If state revenues outpace the growth of our population, surpluses would be dedicated to paying off debt and reducing the state income tax on individuals and businesses,” said Sen. Loudermilk in a release from the Senate recently.

Senate Resolution 594 passed out of the Senate Rules Committee after Crossover Day, and will carry over for consideration during the 2014 session.

If approved by voters, this legislation would mandate spending limits for the State of Georgia based upon the state’s overall fiscal health, particularly as it pertains to current fiscal year spending compared to the previous year. According to this resolution, all fiscal year spending must not exceed the spending from the previous fiscal year, which is adjusted annually to account for inflation or population growth, according to the release.

When general state revenues exceed the spending limit for the current fiscal year, the excess will be appropriated to the following areas:

• Increased population growth in local school systems
• Funding for the Revenue Shortfall Reserve (RSR)
• Satisfying existing state general obligation bond debt
• Reduction of state income tax

In addition, revenue shortfall reserve funds that account for more than 15 percent of the previous year’s fiscal year spending, will reduce the state income tax by one-fourth of one percent.

The limits set forth as part of this amendment can only be exceeded if the General Assembly adopts a joint resolution by a two-thirds majority vote, and the Revenue Shortfall Reserve is exhausted.

“Unlike the Federal government, the State of Georgia has done a good job of handling the budget during the current economic downturn. Instead of incurring massive debt and huge deficits, the Georgia General Assembly has maintained a balanced budget and a AAA bond rating. As the economic recovery continues, state revenues will inevitably begin to increase; however, it is important that Georgia maintain its current position of fiscal responsibility and prioritization of government spending,” said Sen. Loudermilk.

States generally require themselves to have balanced budgets in their Constitutions.

Senate Resolution 594 will remain active for consideration during the 2014 Legislative Session.

Do you agree with Sen. Loudermilk's plan to control spending by the state, and where any excess funding should be spent? Tell us in the comments below.