COVINGTON - Georgia House Speaker Glenn Richardson pledged to the Covington Rotary Club on Wednesday that he would not seek to raise taxes, but instead would seek cuts in services in order to address the state's budget crisis.
Richardson, R-Hiram, admitted the state budget is in trouble following a dip in state revenue that began in May and continued to slide through August. However, September revenue figures were up, though not nearly enough to cover the budget gap.
Richardson said he, Gov. Sonny Perdue and Lt. Gov. Casey Cagle have agreed that they will work to not raise taxes but to "tighten our belts" through cuts to balance the budget.
"We started a plan to make some significant cuts, and they are going to be painful," Richardson said. "There's going to be people from all over the state who will say, 'Why did you cut that?' or 'Why didn't you cut this or cut that.' We're going to make some tough decisions."
Perdue has already ordered most state agencies to make 6 percent cuts in their current budgets. He also withheld $428 million in scheduled homestead tax relief to local governments in August. There remains uncertainty if that money would be released or if the tax relief grant program will continue.
The move has cost Rockdale County $2.25 million and Newton County $1.85 million this year. Local city governments and school systems also had homestead exemptions cuts.
Richardson offered little hope that the program would continue past the next General Assembly session and reiterated Perdue's opinion that the program was not meeting its original purpose to help homeowners.
"The intent of it was to give homeowners a break, but the fact is that since that was put in place homeowners' taxes have increased dramatically, way more than inflation," he said. "The intended effect has not been to help homeowners. It's been to fund other projects."
Officials in Rockdale and Newton counties have disagreed, noting that the state homestead exemption appears on property owners' tax bills and are factored into taxes assessed.
On his failed tax reform package this past year, dubbed the GREAT plan, Richardson defended his position and said he hoped he can "slowly turn that ship in a different direction."
The tax plan would eliminate automobile and education property taxes. In exchange, Richardson's plan would charge sales taxes on a broader list of goods and services. The tax reform package went through some revisions, eventually being limited to replacing automobile ad valorem taxes, but did not come to a vote before the session ended.
"I've sometimes been criticized that I've jumped out in front of some issues, say property taxes, and I should not have done that," Richardson said. "I don't regret making that decision. I still think property taxes are inherently unfair."
In that vein, Richardson said he will work to bring a vote to the House floor in the upcoming General Assembly on a Constitutional amendment that would tie property values with the rate of inflation or 3 percent, whichever is less.
"Property taxes are rising at greater than the rate of inflation, 20 percent one year and 10 percent the next, and greater than the ability of property owners to pay them," he said. "That's why the best tax policy is to spread out tax on 9.5 million Georgians, so a lot pay a little rather than a little pay a lot."
Jay Jones can be reached at firstname.lastname@example.org