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Crawford: Hospitals or stadium — what choice will legislators make?

POSTED: January 16, 2013 1:00 a.m.

There is not an infinite amount of money in Georgia’s annual budget. At the most, legislators will have a little more than $19 billion in state revenues to spend on the programs that are funded.

Because there are a limited number of tax dollars to allocate, lawmakers have to make hard decisions about what they will pay for and what they will discard.

We have seen that hard choice being made over the past decade.

The General Assembly and the governor made the choice to give dozens of tax breaks to corporations and special-interest groups during that 10-year period, in the purported belief that these financial incentives would help “create jobs.”

Legislators are required by the constitution to adopt a balanced budget every year. When you grant that many tax breaks, you have to pay for them somehow.

Our elected leadership effectively paid for those tax breaks by cutting off state funds to local school systems. Since Sonny Perdue became governor in 2003, Georgia has enacted a series of “austerity cuts” to education that reduced state funding to local schools by a combined total of more than $5 billion.

You can have some enlightening debates as to whether this was the best choice we could have made for the state’s future well-being, but it was the choice that legislators made.

As the latest session of the General Assembly gets under way, lawmakers find themselves with another interesting choice to make about their state’s future.

They will be asked to pass a bill that would allow the Georgia World Congress Center Authority to spend $300 million in hotel-motel tax revenues on a new stadium for Arthur Blank and his Atlanta Falcons NFL franchise.

Under the deal that is being privately negotiated with Blank’s attorneys  you don’t get to watch the negotiations, even though your tax dollars are at stake  the Falcons will not only get that $300 million to help build the stadium, they will also retain all the revenues generated in the new facility.

At the same time they are mulling that proposal to give state tax money to one of the wealthiest individuals in Georgia, legislators will also be confronted with a decision to make about the Medicaid program that provides health care services for low-income families.

The legislature adopted a Medicaid provider fee – also known as a hospital bed tax – in 2010 to provide additional funds for the health care program. Each hospital pays a 1.45 percent tax on its net patient revenue, and the money brings in about $400 million a year in federal matching funds that help pay for Medicaid services.

The provider fee will expire this year unless the General Assembly passes  and Gov. Nathan Deal signs  a bill to extend it. If the tax is not renewed, the financially stressed Medicaid program will be in deeper trouble and hospitals in rural areas that depend on Medicaid payments will likely be forced to close.

The bed tax is paid by hospitals and the state’s three major hospital groups are united in their support of it: the Georgia Hospital Association, the Georgia Alliance of Community Hospitals and the rural hospital group HomeTown Health.

Deal and House Speaker David Ralston also agree that some type of provider fee will need to be enacted to keep Medicaid afloat and allow rural hospitals to continue operating. They are facing powerful opposition, however, from anti-tax activist Grover Norquist, the Washington-based figure who has persuaded dozens of elected officials to sign pledges that they won’t ever vote to raise taxes.

“The hospital bed tax is bad policy for Georgia and bad for our country,” Norquist said last fall in a letter to legislators warning them not to renew the provider fee. “A vote in favor of extending the bed tax is a violation of the Taxpayer Protection Pledge.”

Georgia’s lawmakers have some important choices to make. Is a football stadium for an NFL team owned by a billionaire more important to our citizens than keeping rural hospitals open? Do legislators owe their allegiance to the people who voted to put them in office, or to a political crank in Washington, D.C.?

The choices they make on these vital issues will say a lot about the future prosperity of this state.

Tom Crawford is editor of The Georgia Report. His column appears Wednesdays and at gainesvilletimes.com/viewpoint


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