This article appeared in the January 2018 issue of the Georgia's Cities newspaper.
Georgia lawmakers are indicating they will move ahead with legislation in the upcoming General Assembly session that could have a major financial and administrative impact on the state’s municipalities.
One of the biggest issues carried over from last session is the question of whether companies that sell goods over the Internet should be required to pay the state sales tax.
By not paying the state sales tax, online retailers have a price advantage over brick-and-mortar retailers who are required to pay the tax.
Retail giant Amazon has a physical presence in Georgia and pays the state sales tax on its sales into the state. However, third-party retailers known as “marketplace sellers” who use Amazon as an Internet platform do not have their taxes collected for them by Amazon, and many do not collect and remit sales taxes themselves.
Rep. Jay Powell (R-Camilla) sponsored a bill last session, HB 61, which would require the sales tax to be collected from sellers even if they don’t have a physical presence inside the state—it would apply to those who make 200 sales within Georgia or sell more than $250,000 worth of products.
Powell’s bill passed the House but is still being held in the Senate Finance Committee, which did not vote on it last session.
Sen. Chuck Hufstetler (R-Rome), the Finance Committee chairman, said he plans to move the bill out this session.
“The federal government needs to correct this situation, but has taken no action,” said Hufstetler
“A business in Georgia is often at a 7 percent disadvantage to out-of-state and out-of-the-country vendors,” Hufstetler said. “There are a couple of Supreme Court cases that I believe will be resolved in the state’s favor, and hopefully if this law passes, Georgia will be in a position to help our local brick-and-mortar businesses have a level playing field.”
“I believe we should not pick winners and losers and all retailers should be treated the same,” said Sen. John Albers (R-Roswell), a member of the Finance Committee.
It has been estimated that the passage of Internet sales tax parity could mean as much as $200 million per year in revenues to local governments.
Another major issue where there is increasing pressure on legislators to act is the provision of broadband access to high-speed Internet services in rural areas that currently are not served at all or have only intermittent access.
Two bills addressing this issue were held over from last session: SB 232 by Sen. Steve Gooch (R-Dahlonega) and HB 533 from Rep. Brett Harrell (R-Snellville).
The House Rural Development Council appointed by Speaker David Ralston has also included the availability of broadband access as one of its recommendations aimed at trying to move people and businesses to low-population rural areas.
The council recommended revising the tax structure, establishing a grant program to subsidize internet access providers and coming up with an estimate on what it will cost. The council also suggested a partnership with local EMCs to help provide cell phone and broadband coverage to underserved areas.
“It’s my hope that this can ultimately be rolled into the package of bills coming out of the rural development committee,” Harrell said of HB 533.
“We need to provide a way that local governments can provide the management, but do it in a way that facilitates the spread of these new technologies,” said Harrell, a former mayor of Snellville.
“I don’t want anyone (in local government) to play dead and let somebody walk over you, but we need to make sure Georgia is at the forefront of facilitating this technology,” Harrell said.
Lt. Gov. Casey Cagle has indicated that he will also introduce a broadband initiative this session.
Since 2018 is an election year with a governor’s race, the issue of how to deal with Civil War-era Confederate memorials is likely to stir up some contentious debate in the upcoming session.
Cities like Decatur and Kennesaw have Confederate memorials on public property that they would like to move to other locations, but they would need legislative authority to take that action.
Democratic lawmakers generally support giving local governments the flexibility to move these monuments, but the Republican majority is likely to oppose any such legislation.
“Georgia’s cities are important to the economic success of the state,” said GMA’s Director of Governmental Relations Tom Gehl, “and the keys to success in the upcoming session are speaking with one voice, keeping the lines of communication open between city officials and legislators, and working with GMA’s legislative team to tell the stories of how various proposals would impact your city.”