published Thursday, January 5th, 2012

Georgia House speaker predicts more budget cuts

RAY HENRY, Associated Press

ATLANTA — Georgia House Speaker David Ralston predicted Wednesday that lawmakers will need to trim state spending again this year, but not as severely as when the worst recession since the Great Depression forced mammoth reductions in the budget.

Tax collections by the state have been increasing for more than a year as income and spending gradually rebounds from the recession that officially ended in June 2009. Still, Georgia is suffering from a 9.9 percent unemployment rate and most experts expect the economy will recover slowly.

Ralston would not estimate how much money lawmakers will likely need to trim.

"What I've been telling people is that, you know, we used a machete and probably a butcher knife for probably the last two or three budget cycles," he said. "I'm thinking maybe a small pair of sharp scissors this time will be sufficient."

The Republican from North Georgia said he hoped to avoid further cuts to the state's education system, although he cautioned that funding for all aspects of state government could come under scrutiny.

"We've asked a lot out of education over the last few years, both K-12 as well as higher education," he said. "I'm hopeful that we will not have to ask much more, if any, from any of those because I think there reaches a point ... that I'm concerned we don't want to go beyond."

Republican lawmakers abandoned an attempt last year to overhaul Georgia's tax code when critics including Democrats and tea party supporters argued the proposals would raise the tax burden on the middle class. Ralston said he wants his members to move toward a tax system that charges people based more on what they spend, commonly called a consumption tax, than what they earn.

Lt. Gov. Casey Cagle, who presides over the state Senate, said this week that one proposal from last year — reinstating the sales tax of groceries — would be "a non-starter."

Ralston would not rule out resurrecting the grocery tax, but he said he would not favor it.

"I would like to see if we could undertake tax reform in a way that didn't involve that," Ralston said, speaking about the grocery tax proposal. "But I think that if you're going to have an honest discussion about this subject, you've got to say everything is on the table."

Ralston has so far avoided stepping into Republican presidential politics. He said he believes the race will not narrow until South Carolina holds its primary later this month. By contrast, Cagle endorsed Texas Gov. Rick Perry, only to see Perry plummet in the polls after floundering in TV debates. Gov. Nathan Deal has backed former Georgia Congressman and U.S. House Speaker Newt Gingrich, whose up-and-down campaign finished fourth in the Iowa caucuses Tuesday.

Ralston laughed when asked whether he had made an endorsement.

"Thank God, no," he said.

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