Panel not keen about tax reform

COVINGTON - State tax reform stakeholders met Tuesday night at a panel discussion to speak about a proposed legislation that could hurt school system revenue.

The Newton-Rockdale League of Women Voters held an information session and panel discussion Tuesday night at the Newton County Library to discuss tax reform in Georgia, mainly focusing on a package introduced by House Speaker Glenn Richardson.

"Our main problem ... for many of the proposals has been that whatever happens to the tax system here, we have to have enough money to at least run the state we have now," said Peter Armstrong, community education and outreach coordinator for the Georgia Budget and Policy Institute, during his presentation at Tuesday's meeting. "The fact of the matter is there's no free lunch. ... We can pass any type of bills ... but it will cost approximately $22 billion to support Georgia next year, and if we don't raise enough money, we'll have to make cuts somewhere."

He said Georgia is a low-tax state that provides mostly for education and health costs.

"There's not as much fat (to cut) as one may think," he said.

He said Richardson's package, which was formerly known as the GREAT - Georgia's Repeal of Every Ad Valorem Tax - Plan, would eliminate automobile ad valorem taxes and education property taxes and primarily rely on sales taxes to fund those state programs.

"It could leave a $5- to $9- billion hole in the state budget," Armstrong said to an audience comprised of a couple of dozen seniors, educational stakeholders and other community members. "Our children and their children will have to deal with this if we mess it up."

Even though he doesn't agree with the bulk of Richardson's proposal, he said most of the issues can be worked out and that some form of tax reform is something that needs to happen in Georgia because its current system is outdated.

"We need to make sure the economy reflects the new type of economic base in Georgia," he said. "Tax reform discussions need to get beyond politics and special interests and focus on advancing opportunities for Georgians. ... There is some unfairness in the current tax system, but there is no need to rush."

One of Tuesday's panelists, Conyers Mayor Randy Mills said he gives Richardson an "A" for effort but an "F" for some major parts of the plan.

"He's got passion for this," Mills said. "There's so many holes in this. It's a real local control issue - I don't want to have somebody in the state decide."

Mills said he's glad the proposal has Georgians talking about and interested in tax reform, but he doesn't think the bill will pass.

Newton County Schools Superintendent Steven Whatley, another panelist for the night, said he "might" give Richardson an "A" for piquing the public's interest in tax reform, but he's worried about the money that the school system could lose from the plan if it does pass.

"We don't have the base here for supporting it," he said. "Sales tax fluctuates here. Sales tax is a concern for stability."

He said Newton County Schools' net November SPLOST II distribution was a decrease of more than $77,000 from October, which was surprising to him since November was supposed to be a high volume shopping month.

"Somebody's got to bring in that money that is lost," he said.

Rockdale County Board of Education Chairman Jeff Dugan said the idea of eliminating property taxes sounds "wonderful" to most homeowners, but he's worried about who will pay to run Georgia schools.

"I believe public schools are our greatest resources," he said. "I don't think this is something we can play around with ... saying let's cut this and maybe we will have enough to run our schools. ... I think there's a lot to be questioned - I'd rather the speaker slow down."

Dugan said he doesn't mind changing the current tax system as long as it keeps it a stable tax system and the state does its homework beforehand.

"The state doesn't know how much it costs to educate a child in Georgia - get that right first," he said. "I don't want to have to lay teachers off because that means children aren't going to get the same education. ... The consequences could be drastic."

Michelle Floyd can be reached at michelle.floyd@ newtoncitizen.com.