A week after an election was supposed to choose a new governor, the General Assembly will start a $40,000-a-day special session that the current governor probably didn’t need to call.
While Republican Brian Kemp prepares to replace Gov. Nathan Deal and Democrat Stacey Abrams continues to contest the outcome of the election, legislators will open a five-day session Tuesday called ostensibly to approve $270 million in cleanup costs after Hurricane Michael devastated southwest Georgia.
And, oh, by the way, to give their blessing to a tax break for Delta Air Lines and other air carriers that Deal wants finalized before he leaves office in January. At least through the end of June.
The call caused some lawmakers’ eyes to roll.
“Most members of the Legislature know we could have handled the needs of South Georgia without a special session,” said Senate Minority Leader Steve Henson, D-Stone Mountain.
What most legislators know — especially those in the state’s House and Senate leadership — is that there is a Fiscal Affairs Committee made up of lawmakers that can move money around in the state’s $26.2 billion budget to cover things such as the cost of emergency cleanups.
Deal’s chief of staff, Chris Riley, acknowledged as much last month when the governor announced plans for the special session.
“As you know, we could do it in Fiscal Affairs, but we want to do it all aboveboard and the governor wants to allow every member to vote instead of doing it in Fiscal Affairs where there are no questions,” Riley said.
House Speaker David Ralston, R-Blue Ridge, said much the same: it provides “greater transparency” to hold a special session.
“I don’t think you want to abdicate to a committee that which the Legislature can have input into,” Ralston said. “I strongly prefer doing it this way than doing it through Fiscal Affairs. We’re going to be out in the open, people are going to be able to comment on it, much more than if it were in that committee.”
But Sen. Josh McKoon, R-Columbus, asked, “If this was truly about desperately needed financial help for a storm that happened Oct. 11 … why didn’t we meet the following week? If it’s not desperately needed, why not wait until Jan. 14” when the next regular session begins?
The General Assembly convenes its regular session in two months, when lawmakers will consider a midyear budget used to cover expenses that come up during the fiscal year — such as emergency expenditures for hurricane cleanup.
However, Riley said the state needs the money now because local governments, state agencies and contractors have been incurring costs — for things such as debris removal and staff overtime — since the storm hit in October. The midyear budget typically isn’t approved until February or March, and federal aid, which will repay the state, may not arrive for months, if not years, he said.
“We don’t have the money in the budget (right now) to cover these costs, and they have to pay them,” Riley said. “There are bills that need to be paid now.”
Deal has squirreled away $2.5 billion in state reserves, but Riley said that money will be left for the next governor. Instead, Riley said, the state will use excess tax money that has come in so far this year.
Because Deal called lawmakers into a session — rather than have the Fiscal Affairs Committee handle the hurricane money transfer — legislators will also have to vote on whether to endorse or oppose state executive decisions that the governor has signed since the last session.
Deal signed an executive order in July suspending collection of the state sales tax on jet fuel. The tax break, and an earlier decision not to collect local jet-fuel taxes, could save Delta about $40 million a year. The executive order now goes before the General Assembly.
Georgia governors over the years have issued sparing calls — and plenty of threats — for special legislative sessions. When they do, governors have broad powers; state law lets governors strictly control the agenda that lawmakers consider.
A session costs taxpayers at least $40,000 a day in per diem paid to state lawmakers, along with any other costs associated with it, such as printing and staffing. Riley said it can be accomplished in as little as five legislative days, so it will likely be over next Monday or Tuesday.
Lawmakers had first given Delta a tax break in 2005 when the airline was facing financial problems. While Delta’s bottom line improved dramatically, legislators periodically re-upped the jet-fuel break, making a case that the state’s rate was among the highest in the country. They killed it in 2015 when Delta got on the wrong side of lawmakers.
The General Assembly appeared poised earlier this year to approve a tax break for all jet-fuel users until Delta broke marketing ties with the National Rifle Association, a move guaranteed to cause trouble in an election year. The decision followed the mass shooting at a Parkland, Fla., high school that left 17 people dead.
Delta’s action infuriated some conservatives and prompted each of the leading GOP candidates for governor to oppose the tax exemption. Lt. Gov. Casey Cagle, the Senate’s president and then a leading Republican candidate for governor, was the most aggressive: His vow to block the legislation effectively killed it, despite Deal’s objection.
The governor’s staff later found a workaround: executive orders.
If lawmakers reject his order to stop state collections, all jet-fuel users would have to remit millions of dollars worth of the taxes owed to state and local governments since the order was signed.
Ralston said it’s not a given that lawmakers will back the tax break.
“My view is that any time we do preferential tax treatment for any entity, the burden is on that entity to make the case for why it is necessary and why it is good for the overall economy of this state,” he said. “To be candid with you, I haven’t had that case made yet.
“I think it is going to have a tough row to hoe. I don’t want to make predictions as to whether we will adopt it or not.”
McKoon said, “It’s hard for me to fathom why, with gas at $3 a gallon for regular people … that we are going to give this enormous tax break.”
Senate President Pro Tem Butch Miller, R-Gainesville, sent colleagues a message from Riley on Friday, telling them the tax break they will vote on will only run through June 30. Riley said the governor wants lawmakers to take up the issue of whether the tax break should be continued beyond that during the 2019 session.
In the past, lawmakers have approved the tax break with a sunset of two or more years so they could review it periodically.
For Delta, it would be a long-sought victory. The company has said that sales taxes on jet fuel put Georgia at a disadvantage, since many other states don’t charge them or charge less. Before the 2018 session, it mounted a major lobbying offensive for the measure, including hiring Deal’s former executive counsel.
Why: $270 million in cleanup costs after Hurricane Michael devastated southwest Georgia and a tax break for Delta Air Lines and other air carriers are on the agenda.
How long: The session is expected to five days.
Cost: A session costs taxpayers at least $40,000 a day in per diem paid to state lawmakers, along with any other costs associated with it, such as printing and staffing.