Georgia Legislative Session preview

by Dentons
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Dentons’ State Government Affairs team examines a battery of local third-rail issues on tap when the Georgia General Assembly convenes January 11. We look at expanded rail service in Atlanta, balancing religious freedom, Medicaid expansion, Las Vegas-style casinos as a stop-gap for the HOPE scholarship fund, education and child welfare reform, local cultivation of medicinal marijuana, fantasy sports’ legality and craft brewery sales, and what happens when the GOP race for the White House comes to Georgia.

Transit funding

Expanded state funding for public transit in Georgia’s clogged capital city and its outlying suburban and exurban communities continues to register among the local business community’s highest priorities for the coming legislative session, an extension of the powerful lobby’s successful passage last year of a $900 million highway and bridge funding package.

Already the Metro Atlanta Chamber of Commerce has publicly signaled it will aggressively pressure state lawmakers to fund transit expansions and allow voters in Fulton and DeKalb counties to self-determine a half-penny tax to finance expanded MARTA rail service. If approved, the half-penny tax would augment an existing penny tax, already supporting rail service into Atlanta’s north, along Georgia 400 into Alpharetta; along the Clifton Corridor, the metropolitan area’s largest activity center with no direct access to a MARTA station or interstate; and to the east, along Interstate 20.

By way of reassuring tax-wary conservatives in the Legislature, which approved in 2011 after much horse-trading a regional special purpose transportation tax referendum that later failed in nine of the state’s 12 regions, the Metro Chamber said its internal polling indicates that voters are more inclined to support new taxes for transit rather than roads, like the failed T-SPLOST measure.

If approved, the measure is expected to generate some $4 billion in new revenue and could qualify for additional $4 billion in federal grants.

Expect to hear as the session’s top transit talking point the corporate relocation of Mercedes-Benz USA from Montvale, New Jersey to its new home in Sandy Springs. The automaker was said to have selected the site, which has access to a pair of interstate systems, for its easy access to MARTA, situated little more than a half-mile from its new campus.

Religious Freedom Restoration Act

The United States Supreme Court’s landmark 2014 Obergefell v. Hodges ruling, which held that the Fourteenth Amendment requires the recognition of same-sex marriages in a manner no different from opposite sex unions, has reinvigorated the debate over religious liberty in conservative quarters, even as the sponsor of Georgia’s Religious Freedom Restoration Act insists the contentious proposal is unrelated to the federal tumult.

The Legislature adjourned its previous session with that bill, S.B. 129, frozen in the House Judiciary Committee after then-Rep. Mike Jacobs, who has since departed the General Assembly for a judgeship, introduced a non-discrimination clause. The bill’s supporters said the amendment, which would have prevented the measure from circumventing existing state and local nondiscrimination ordinances, was a poison pill: “This is the amendment that would gut this bill,” Rep. Barry Fleming said at a hearing last year.

The bill's chief Senate sponsor, Sen. Josh McKoon, hopes to revive the still-tabled legislation but faces considerable headwind—both within and without the Gold Dome.

The business community in general and the tourism and hospitality industry in particular is especially opposed to it after bearing witness to the fallout from Indiana’s passage of similar legislation last year. And an increasing number of Republicans, including those in leadership, have publicly warned that it would not earn chamber-wide consideration unless it includes non-discrimination protections.

Casino gaming

The odds are long but major gambling interests hope to convince the Legislature to put the question of Las Vegas-style casinos in Georgia directly to voters in a 2016 general election ballot referendum that would amend the state constitution.

Concurrent House and Senate study committees convened several times during the fall to hear testimony on the proposal and are expected to release final findings in a much-anticipated report to lawmakers ahead of the session’s January 11 commencement.

Gambling in Georgia is largely restricted to the state-run lottery, which finances the state’s merit-based HOPE scholarship program, for which demand now outpaces resources.

Already major gambling interests have expressed a cautious eagerness at the prospect of opening major downtown Atlanta and coastal gaming resorts, arguing that the new projects could meet HOPE's budget shortfall. Their enthusiasm met a chill, however, from Governor Deal, who has publicly worried that the revenue generated by the casinos would be too low and would in turn divert private resources from the existing lottery system.

“I don’t want us to do anything that would jeopardize” the HOPE program Governor Deal said in December. “I know HOPE has been such a successful program and people want to use that as a springboard. But there’s only a limited amount of money that is available for people to spend on gaming activities, and our HOPE program is totally dependent on the success of the lottery in the state.”

Medicaid expansion

Governor Deal has already forsworn a possible expansion of the Medicaid system, a social health care program for those with limited income and low resources that is jointly funded by federal and state governments but managed exclusively by individual states, even as the Affordable Care Act has called for the states to broaden eligibility thresholds.

Deal has long opposed an expansion of the program but is shouldering increasing pressure to relent from hospitals and doctors.

The Medical Association of Georgia, the state’s physicians lobby, recently voted to support the expansion with a caveat: that the state use the increased federal monies from the ACA to purchase private insurance for new enrollees on the Health Insurance Marketplace. Other groups, including the Georgia Chamber of Commerce, have formed coalitions and study committees to propose a hybrid system that the governor could accept.

The governor’s office has estimated the expansion would cost the state an additional $4 billion over a decade, though supporters of the expansion counter the cost registers closer to half that total and would draw some $30 billion in federal dollars to the state.

Elsewhere under the Dome

Medicinal marijuana: The General Assembly last year made legal the use of a non-euphoric marijuana derivative for the treatment of a handful of acute medical conditions, including epilepsy. The bill however stopped short of allowing the substance to be locally cultivated and produced, which means otherwise qualifying patients must risk purchasing the extract elsewhere and trafficking it across state lines, which remains a federal crime. A local coalition has formed to lobby the Legislature to allow for in-state cultivation of the oil, but Governor Deal has publicly stated he is reluctant to support the proposal.

Fantasy sports: The Georgia Lottery Commission, which administers the state lottery system from which the HOPE educational fund is financed, has put the two largest fantasy sports websites on notice that it is probing the legality of their operations within the state. The two companies, DraftKings and FanDuel, have responded that their activities are fully compliant with Georgia's existing framework, arguing that theirs is a skill-based enterprise, and are expected to pursue legislation clarifying the legality of their operations.

Craft brewery sales: The General Assembly last year revised state regulations governing the sale of alcohol on the campuses of craft breweries, green lighting a back-end through which the brewers could sell their beer directly to consumers. That legislation allowed brewers to create a staggered tour package system, with graduated price points for different values of beer. The State Department of Revenue put a freeze on that system, warning that while brewers may offer graduated tour packages, they may not be based on the value of beer vended. Speaker David Ralston has said the department must "revisit" that ruling—or it would fall to lawmakers to resolve the matter.

Education reform: The General Assembly might entertain legislation to alter and modernize Georgia’s formula for K-12 public education based on specific policy recommendations adopted by the Education Reform Commission created by Governor Deal.

Child welfare: Governor Deal and several key members of the General Assembly have focused on child welfare issues over the past two years by a commission, appointed by the governor, and legislative study committees, so we anticipate other legislation or agency regulations to follow on that initial work to improve safety and efficiency.

GOP race for the White House comes to Georgia

The dovetailing of Georgia’s Republican presidential primary with its own legislative session will mean for an especially political season at the state capitol.

Georgia is but one of six southeastern states that have aligned to form a primary election day bloc, dubbed the “SEC Primary,” but its expansive media markets and access to wealthy donors means it will factor most prominently in the March 1 primary.

Already, GOP candidates-including Governors Jeb Bush and John Kasich, businessman Donald Trump, and Senator Ted Cruz-have visited the state and some have already opened formal campaign offices. The frequency with which the candidates appear in Georgia and the television and radio advertisements their campaigns air will increase dramatically in the days following the New Hampshire primary, less than a month before our own.

Hoping to curry favor with the state's powerful religious conservative community ahead of the March 1 vote, the candidates are expected to inject themselves in the state's consideration of religious freedom legislation in a manner that might rankle the state's business community.

But even as the politics of the presidential races promises to inject itself into the local dynamic, the calendar—with an early March qualifying date and late May primary—means that the session should stretch no later than the first of April as legislators eye their own races.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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