ATLANTA – Georgia’s film industry tax incentive generated $8.55 billion in economic impact in fiscal 2022, according to a new study.
The study, conducted by Olsberg SPI, a London-based consulting firm, found the film tax break is responsible for nearly 60,000 jobs and produces a return on investment of $6.30 for every $1 the tax incentive costs Georgia in lost tax revenue.
“This study proves the film tax incentive is working exactly as intended,” said Kelsey Moore, executive director of the Georgia Screen Entertainment Coalition, which commissioned the study. “It’s created high-paying jobs for Georgians, supports thousands of new and existing small businesses, and attracts billions in production spending and investment each year.”
The film tax credit’s return on investment is particularly significant for the General Assembly, which formed a joint House-Senate committee this year to examine all of Georgia’s tax incentives and determine whether they’re accomplishing the corporate investment and job creation for which they were intended.
At the panel’s opening hearing in June, supporters of the film tax credit defended it as a major contributor to the success story of the state’s film industry, which has grown exponentially since the credit was adopted in 2008.
The new study found that less than 8% of Georgia’s film production activity would have occurred without the tax credit. That’s an important consideration when the amount of economic activity a particular industry would have generated without a tax break in its favor – the so-called “but-for” argument – has become a major factor in determining whether a tax incentive is considered worthwhile.
The study also showed that studio construction, which does not receive the film tax credit, created $1.28 billion in capital investment in Georgia between 2012 and last year, bringing the state’s stage space from 45,000 square feet to more than 5.6 million.
The film tax credit accounts for about $1 billion in lost state tax revenue each year, making it by far the most expensive on the books in Georgia.
With that much tax revenue at stake, lawmakers have enacted guardrails aimed at ensuring accountability. Legislation the General Assembly passed in 2020 requires all film productions located in Georgia to undergo mandatory audits.
The amount of attention the film tax credit has garnered under the Gold Dome has prompted industry insiders to point out how much the state would lose without it.
“If alterations to the film tax incentive make our state no longer competitive for production, Georgians all across our state will be the ones that lose,” Moore warned.
“It will leave tens of thousands of Georgians and their families without wages or benefits. It will halt the billions in capital investments and production spending flowing to our communities and small businesses, and it will drive homegrown talent out of our state.”
ATLANTA – Georgia youths in the custody of the state’s foster care system are disproportionately likely to become victims of child sex trafficking, several experts in the subject testified Monday.
Between 2018 and last year, the National Center for Missing and Exploited Children received more than 2,400 reports of children missing from foster care in Georgia involving 1,790 children, many of whom went missing several times throughout the year, Samantha Sahl, supervisor of the national nonprofit’s Child Sex Trafficking Recovery Services Team, told a U.S. Senate subcommittee at a hearing in Atlanta.
Of those missing children, 410 were identified as likely child sex trafficking victims, she said.
Sahl and other witnesses blamed the trend on children who run away from horrendous conditions they suffer in foster care settings resulting from systemic failures by the Georgia Division of Family and Children Services (DFCS).
“We know we have an urgent issue when children feel better on the streets or with a trafficker than they do in their foster-care placements,” Sahl said.
Monday’s hearing on conditions in Georgia’s foster care system was the third in the last two weeks held by the U.S. Senate Subcommittee on Human Rights, chaired by Sen. Jon Ossoff, D-Ga. At the first hearing, Ossoff revealed the results of a DFCS internal audit that showed the agency failed in 84% of cases brought to its attention to address risks and safety concerns.
The second hearing as well as Monday’s testimony focused on the number of children under DFCS supervision who end up missing.
DFCS officials responded to the first two hearings with a letter accusing the subcommittee of failing to request information or responses from DFCS in advance of the hearings and charging the panel’s investigation has been political in nature.
On Monday, Brian Atkinson, a staff lawyer with The Wilbanks Child Endangerment and Sexual Exploitation (CEASE) Clinic at the University of Georgia’s School of Law, said his experience shows entry into Georgia’s foster care system puts children at risk of being trafficked.
“If a child’s caregiver, family, friends, communities, and the state fail to provide for their basic needs of food, shelter, safety, security, love, their survival instincts kick in and they search for other ways to have those needs met, heightening their risk of landing straight in the hands of traffickers,” he said.
Tiffani McLean-Camp, 19, gave personal testimony Monday of her experiences when she entered foster care at age 15 after being physically abused by adoptive parents and sexually abused by a family friend. She said the abuse continued while she was moved to various placements 20 times.
McLean-Camp said one of those placements was in a facility with a gate surrounded by barbed wire. where she was physically abused and overmedicated.
“It felt like being in prison,” she said. “It made me feel like an animal locked up in a cage.”
After she became pregnant and her son was born prematurely, McLean-Camp said she and her infant son were separated at times and then placed in an emergency shelter where she got no attention for post-partum depression or physical complications from her pregnancy.
She said she got no visits from her DFCS case manager and received no help from the agency.
“I had to learn everything on my own,” she said. “I had to teach myself.”
“No child should have to go through the experiences you have survived,” Ossoff told McLean-Camp following her testimony.
Atkinson said he believes the foster care system has made progress in embracing the concept of treating children who fall prey to sex trafficking as victims and not criminals. But he said too many victims still are cast in a negative light, which makes them less likely to get the help they need.
“When our clients reach out to DFCS, they’re met with disbelief, dismissiveness, and often no response at all,” he said.
ATLANTA – Legislative Democrats and social services advocates have long complained that Georgia doesn’t spend enough money to meet the educational, health-care, and public-safety needs of a growing population.
But there’s something different about the latest fiscal numbers that prompted the left-leaning Georgia Budget and Policy Institute (GBPI) to release a 15-page report Oct. 31 calling for the state to loosen its purse strings.
The state was sitting on $16 billion in unspent funds at the end of the last fiscal year in June, including $11 billion in undesignated reserves.
“It’s uncharted territory,” said Danny Kanso, the GBPI’s fiscal analyst and the report’s author. “I don’t think it serves anyone to have $11 billion sitting there in an account with no plan for it.”
While news of that much tax money not going toward any purpose is sure to stir debate during the 2024 General Assembly session beginning in January, Republican Gov. Brian Kemp and GOP legislative leaders are sticking with their determination to maintain fiscal discipline.
“The governor looks forward to working closely with the General Assembly on priorities for how the state’s one-time funds will be utilized in a strategically responsible way that does not commit short-term revenue gains to long-term obligations,” Garrison Douglas, a spokesman for Kemp, said back in July as initial word of a third straight year of large budget surpluses was surfacing.
“Everyone’s foaming at the mouth over $16 billion,” state Senate Appropriations Committee Chairman Blake Tillery, R-Vidalia, said Nov. 2. “They forget that’s only six months of revenue for the state. You have a rough time and that money will burn very quickly.”
The GBPI report attributes the huge pile of unspent dollars to “repeated underestimations of annual state revenue collections” that resulted in the state bringing in far more tax money than was being spent for three consecutive years. On the other side of the equation, state spending was failing to keep pace with inflation and population growth, according to the report.
“There are several unique areas in which surplus funds present a rare opportunity to address deficits built up over time and projected needs in the future – all while strengthening Georgia’s economy, supporting job creation, and benefiting families statewide,” the report stated.
Specifically, the report suggests the state use undesignated reserves to:
create a $7.5 billion, self-sustaining Child Care Trust Fund to promote access to affordable, quality child care.
modernize Georgia’s school bus fleet by making long-deferred investments to help cash-strapped local school districts maintain and replace aging buses.
provide bonuses to state employees to help agencies providing vital services reduce turnover.
Kanso said the Child Care Trust Fund could pay for itself by being managed in the same way the state handles its teacher and employee retirement system funds. The balance of the fund would compound each year at a rate higher than the annual payout, the report said.
Kanso said one-third of the school buses plying Georgia highways are more than 15 years old because state funding for the buses has been cut significantly in recent years. His report recommends spending $850 million to $2.7 billion to modernize the school bus fleet.
“If we don’t address that, it’s going to be more and more costs for local school districts,” he said. “The state can help local school districts catch their breath.”
Kemp and the General Assembly already have provided targeted pay raises to employees of state agencies suffering high turnover rates, including $11,000 increases for state law enforcement officers during the last two years and $2,000 raises this year for other state workers, teachers, and university system employees. Altogether, teacher salaries have gone up $5,000 since Kemp took office in 2019.
Kanso’s report pointed to annual turnover rates of 25% in state agencies Georgians rely on for vital services as evidence the state still needs to do more.
The governor and legislature also have used surplus funds to provide state income tax rebates to Georgians during the last two years, while Kemp has suspended the state sales tax on gasoline to curb rising prices at the pump.
Kanso said those tax cuts are just scratching the surface of the huge pile of undesignated reserves the state could use to beef up investments in ongoing needs.
But Tillery said the General Assembly’s Republican majorities aren’t about to suddenly change course on spending.
“It’s not the state’s money. It’s taxpayers’ money,” he said. “Individuals who think the session is going to be a money-raining-from-heaven free-for-all are mistaken.”
Commissioner Tim Echols’ term on the state Public Service Commission expired last year.
ATLANTA – State energy regulators have denied a request by two citizen watchdog groups to consider delaying hearings on how much of the costs of the Plant Vogtle nuclear expansion must be paid by electric customers until after commission elections.
The U.S. Supreme Court put the filling of two seats on the five-member Georgia Public Service Commission (PSC) on hold last year until the General Assembly changes the way PSC elections are conducted.
Because the November 2022 elections were postponed, Commissioner Tim Echols’ term has expired and Commissioner Fitz Johnson, who was appointed to the panel to complete the term of a commissioner who left the PSC, has not stood for election in his own right.
The PSC will hold “prudency” hearings this fall on how to divide the costs of building two additional nuclear reactors at Plant Vogtle between Georgia Power customers and the utility’s shareholders, with a vote set for Dec. 19. The two watchdog groups asked the commission to put their request to delay the hearings on Thursday’s Energy Commission agenda.
“Allowing unelected commissioners Johnson and Echols to participate in any phase of this case is reckless, unnecessary, and unduly jeopardizes the authority and legitimacy of any decision the commission makes,” Glenn Carroll, coordinator of Nuclear Watch South, told commissioners Thursday.
PSC staff lawyer Preston Thomas said Georgia Power filed documents seeking the hearings in late August, while Nuclear Watch South and Georgia WAND, the two statewide nonprofits that asked for the delay, didn’t file their petition until four days before Thursday’s meeting. That made it impossible for the commission to give other parties involved in the case the usual 30 days to respond in time for Thursday’s meeting, he said.
“Any urgency that Nuclear Watch claims might exist is dispelled by the fact that they failed to act over the last two months,” Thomas said.
In a system unique to the PSC in Georgia, commissioners run statewide, even though they represent one of five districts. The court ruling putting off elections in the districts served by Echols and Johnson stemmed from a lawsuit a group of prominent Black leaders filed claiming the redistricting plan the General Assembly’s Republican majorities passed in March of last year dilutes the Black vote in those two districts.
Two new buildings were recently completed at the Port of Brunswick (Georgia Ports Authority)
ATLANTA – More than $262 million in planned improvements at the Port of Brunswick are coming just in time to accommodate a significant growth in auto and machinery business.
The Colonel’s Island Terminal in Brunswick handled 70,645 units of Roll-on/Roll-off cargo in September, an increase of 61% over September of last year.
“The automotive sector has been especially strong, and consumer demand is driving this trend,” said Griff Lynch, president and CEO of the Georgia Ports Authority. “Our investments in infrastructure capacity are well-timed to support the growing business in our Brunswick gateway.”
The Port of Brunswick is adding 640,000 square feet of auto and machinery processing space across five new buildings, including 350,000 square feet of near-dock warehousing that is now complete. The ports authority also is developing another 122 acres of cargo storage space.
Lynch announced earlier this week the authority’s goal of making Brunswick the No.-1 port in the country for Roll-on/Roll-off cargo by 2026.
Part of that is adding new customers. Shipping line CMA-CGM started a new service carrying vehicles from Mexico to Brunswick in July, and the Gold Star line will begin a similar Mexico-to-Brunswick route this month.
Meanwhile, the ports authority experienced its busiest month ever for container trade in September outside of a pandemic-related spike last year. Nearly 403,000 twenty-foot equivalent units (TEUs) of containerized cargo crossed Georgia Ports Authority docks in September, primarily at the Port of Savannah.
While that was 7.6% below the volume reported in September of last year, it was 9% higher than in September 2019, the most recent year unaffected by the pandemic.
