GRA CAPITOL HILL ADVOCACY
THIS WEEK’S LEGISLATIVE ISSUES
• Governor vetoes Jobs Act of 2009
• Help in Stopping Under Aged Alcohol Purchases
• Bills Passed
• Bills vetoed
QUOTE TO PONDER

Georgia Retail Association (GRA) Leaders Visit Capitol Hill

“It were not best that we should all think alike; it is difference of opinion that makes horse races." Samuel "Mark Twain" Clemens

While I generally appreciate Samuel Clemens humor and wisdom, last week’s trip to DC changed my mind concerning the “different-type “ thinking that is going on in DC these days.

During our trip to Washington, DC, GRA Chair Anthony Waters, Chair-Elect Bill Bregar and I heard a lot of “different-type” thinking and it was more than a little upsetting. Ray LaHood, Secretary of Transportation, spoke about an intermodal approach to transportation and he focused on highways and railroads, which definitely need attention. However, a large number of Georgia’s retailers also depend on the Port of Savannah for receipt of merchandise. So, I asked him if the intermodal approach also included investing in our ports.

The Secretary of Transportation said yes, and then added that recently Georgia’s governor, Sonny Perdue had been in DC and had asked the same question. He then listed the ports which would receive significant federal funds from the stimulus package – that list, disappointedly, did not include Savannah.

Following another presentation, Anthony Waters asked House Majority Whip, James Clyburn, if he understood that a massive push to require health insurance coverage for all employees might put a lot of small retailers out of business. The Majority Whip (one of the top leadership positions in the Democratically controlled House) shared a story with the moral being that if a business could not afford to pay for health insurance for its employees, it should go out of business.

While all ears were alert when they heard Anthony’s question – the room became deathly silent by the shock which followed Clyburn’s reply.

And it's not just Medicare squeezing the federal budget. Medical costs are also squeezing the Georgia budget. Medicaid spending as a percent of the Georgia budget swelled from 17 percent in 1998 to 28 percent in the recently passed 2010 budget. During that time, the percentage of the budget allocated to the Department of Education, Board of Regents, Technical College System and Department of Transportation shrank.

As the week went on, it became ever more clear, that the current administration and Congressional leadership do not understand what it costs to operate a retail business, how small retail profit margins are, nor do they comprehend the fine economic thread that retail businesses are hanging from amid the current economic downturn.

Even friends like Utah Senator Orrin Hatch were on the defensive, warning us that passage of the Employee Free Choice Act, (EFCA) would have dire consequences.

He added, “Democrats have an entire labor law agenda stacked up just waiting for EFCA to pass. If this passes, union membership will increase along with union campaign contributions and union “political clout” and businesses could “get overrun.”

Hatch said EFCA would open the way for additional legislation mandating paid sick leave, increased OSHA penalties, stronger penalties for allegations of pay discrimination and a number of other proposals that would prove onerous for the business community.

Hatch warned, “It’s your job to make sure that every Senate Republican votes against EFCA or any alternative and that several Democrats do the same.”

Georgia senators Johnny Isakson and Saxby Chambliss are dead set against EFCA. I spoke with Senator Isakson over breakfast on Saturday, May 16, and he reiterated his opposition to this onerous piece of legislation.

(EFCA would effectively eliminate secret ballots in union organizing elections, instead establishing a “card check” procedure where the National Labor Relations Board would be required to recognize a union if presented with union cards signed by a majority of workers. The legislation would also cut off negotiations over first union contracts if an agreement had not been reached in 120 days, instead requiring the parties to engage in binding interest arbitration.)

Governor Vetoes Jobs Act of 2009

Despite all of our efforts (three thousand phone calls, hundreds of emails, faxes and letters) Governor Sonny Perdue vetoed HB 481, the Jobs Act of 2009. By doing so he killed our chance to get rid of the sales tax deposit this year.

Help in Stopping Under Aged Alcohol Purchases

HB 71- Outlawing Novelty IDs - Existing state law permits phony IDs as long as they are branded with the word "novelty." "Novelty IDs allowed the exact likeness of an ID purchaser's face to appear on and bogus info in a Georgia driver's license." This law makes that practice illegal.

Law enforcement officials say such bogus documents are used in support of underage drinking, identity theft and other crimes. Some Web sites offer two-week shipping. And for less than $100, anyone with a stolen credit card can buy an ID to match the name of the victim.

Purchasers can make the ID look legitimate by covering up the "novelty" brand on the back. According to one Web site concerning fake IDs, Georgia is the fourth most popular state for the fake documentation.
Status: Signed into law by the governor on May 30, 2009; effective date 10/1/09

RETAIL RELATED BILLS SIGNED INTO LAW

SB 31 - Georgia Nuclear Energy Financing Act, allows a utility to recover from its customers the costs of financing associated with the construction of a nuclear generating plant in advance of the final construction.
Status: Signed into law by the governor on April 21, 2009; effective date 4/21/09

HB 57 – Establishing Rules for Common Carriers, sets rules for common freight carriers operating in Georgia.
Status: Signed into law by the governor on May 4, 2009; effective date 5/4/09

HB 59 - Sales Tax Exclusion for Some Controlled Substances, exempts from sales and use taxes those controlled substances and dangerous drugs, which are either sold or are distributed without charge to physicians, dentists, clinics, hospitals, or any other person or entity located in Georgia by a pharmaceutical manufacturer or distributor; and would exempt from sales and use taxes controlled substances which are lawfully dispensed without charge for the purposes of a clinical trial approved by an institutional review board which has been accredited by the Association for the Accreditation of Human Research Protection Programs.
Status: Signed into law by the governor on April 21, 2009; effective date 7/1/09

HB 71- Outlawing Novelty IDs - Existing state law permits phony IDs as long as they are branded with the word "novelty." "Novelty IDs allowed the exact likeness of an ID purchaser's face to appear on and bogus info in a Georgia driver's license." This law makes that practice illegal.
Status: Signed into law by the governor on May 30, 2009; effective date 10/1/09

HB 74 – Defining Revenue and Taxation, provides definitions of revenue and taxation.
Status: Signed into law by the governor on April 8, 2009; effective date 1/1/09

HB 80 – Redefining Group for Insurance Purposes, redefines group insurance contracts or contracts to cover as those that cover two rather than 100 employees. This bill was passed by the House on February 5th and by the Senate on March 18th.
Status: Signed into law by the governor on May 4, 2009; effective date 7/1/09

SB 80 - Food Standards, Labeling, and Adulteration, provides requirements for the testing of samples or specimens of foods by food sales establishments for the presence of poisonous or deleterious substances.
Status: Signed into law by the governor on May 1, 2009; effective date 5/1/09

HB 120 – Sales Tax Holiday, provides an exemption from sales tax on articles of clothing and footwear with a sales price of $100.00 or less; personal computers and personal computer related accessories with a sales price of $1,500 or less; and general school supplies with a sales price of $20.00 per item including pens, pencils, notebooks, paper, book bags, dictionaries, calculators and thesauruses from at 12:01 A.M. July 30, 2009, and concluding at 12:00 midnight on August 2, 2009.

It also provides a sales tax holiday on the purchase of energy efficient products and water efficient products with a sales price of $1,500.00 or less per product purchased for noncommercial home or personal use from 12:01 A.M. on October 1, 2009, and concluding at 12:00 midnight on October 4, 2009.
Status: Signed into law by the governor on May 4, 2009; effective date 5/4/09

HB 126 - Electronic Contracts and Signatures, sponsored by representatives Ed Lindsey, (R) 54th and Wendell Willard, (R) 49th, would legitimize electronic contracts and signatures as legal devices.
Status: Signed into law by the governor on May 5, 2009; effective date 7/1/09

HB 173 – Illegal and Void Contracts, Restraint of Trade, defines certain legal means of providing for restraint of trade in work contracts, restrictive covenants, and more.
Status: Signed into law by the governor on April 29, 2009; effective date 4/29/09

HB 186 – Teleworking Tax Credits, sponsored by representatives Chuck Martin, (R) 47th, Karla Drenner, (D) 86th and Clay Cox, (R) 102nd, would allow tax credits for teleworking arrangements.
Status: Signed into law by the governor on May 11, 2009; effective date 5/11/09

HB 217 – Provision of Flu Shots, establishes the protocol for providing flu shots in retail establishments and other locations.
Status: Signed into law by the governor on April 27, 2009; effective date 4/27/09

HB 233 – Freeze on Property Taxes, provides for a two-year moratorium on increasing the assessed value of real estate, including commercial real estate.
Status: Signed into law by the governor on May 6, 2009; effective date 5/6/09

HB 302 - Charging A Customer For Any Third Party Service Provided By A Telecommunications Company, requires any telecommunications company that charges a customer for a service which is provided to the customer by a nonaffiliated third party must provide to such customer the ability to block the nonaffiliated third-party service and any charges associated with such service.
Status: Signed into law by the governor on April 30, 2009; effective date 1/1/2010

HB 308 - Defining Liability for Limited Liability Companies, redefines liability for a LLC.
Status: Signed into law by the governor on April 21, 2009; effective 4/21/09

House Bill 330 - Relating To Workers' Compensation, clarifies the address of record for the plaintiff, defines notice, set appeal timeline, and provides for a waiver of the employee's medical history confidentiality, was passed by the House on March 4th and out of the Senate Insurance and Labor Committee on March 18, 2009.
Status: Signed into law by the governor on April 21, 2009; effective 4/21/09

HB 334 – Lowering the Threshold for Electronic Payment of Sales Taxes, lowers the threshold for requiring electronic funds transfer of sales tax revenue to the Department of Revenue from $5,000 per month to $1,000 on January 1, 2010 and $500 per month on January 1, 2011.
Status: Signed into law by the governor on May 4, 2009; effective 1/1/2010

HB 368 – Annual Bill for Schedule II, III, and IV Controlled Substances, amends Chapter 13 of Title 16 of the Official Code of Georgia Annotated, relating to controlled substances, so as to change certain provisions relating to Schedule II, III, and IV controlled substances.
Status: Signed into law by the governor on April 21, 2009; effective 4/21/09

HB 379 – Disallowing Income Tax Expenses Paid For Real Estate Investment Trusts, sponsored by Representative Larry O’Neal, (R) 146th, would disallow the shielding of income received through a real estate investment trust.
Status: Signed into law by the governor on May 1, 2009; effective date 5/1/09

HB 427 – Redefining an Enterprise Zone, defines a poverty zone for the identification of an enterprise zone as parcels within or adjacent to a census block group where the ratio of income to poverty level for at least 15 percent of the residents shall be less than 1.0.
Status: Signed into law by the governor on April 21, 2009; effective 4/21/09

HB 438 - Income Tax Credits For Qualified Jobs And Projects, sponsored by representatives Larry O’Neal, (R) 146th and Ron Stephens, (R) 164th, would have excluded retailers from receiving job-retraining tax credits; would eliminate the existing headquarters tax credit and in its place would establish a tax credit for any job created that pays a higher wage than the average wage in the county in which the job is created and finally, provide a Mega Tax Credit for qualifying companies that agree to create a minimum of 1,800 jobs and either invests a minimum of $450 million in a project or brings an annual payroll of $150 million to the state.

Over the objections of the Governor’s Office of Economic Development, GRA was successful in having language inserted that specifically included retailers.
Status: Signed into law by the governor on May 5, 2009; effective date 5/5/09

HB 439 – Income Tax Credits for Employee Re-Training, provides income tax credits for retraining employees.
Status: Signed into law by the governor on May 4, 2009; effective 5/4/09

HB 441 – Filing for Sales Tax Refunds, sponsored by Representative Larry O`Neal, (R) 146th, would require a taxpayer who wishes to expedite the payment of a sales and use tax claim for refund to file a bond with Department of Revenue Commissioner. The commissioner, in turn, must issue the refund within 30 days of the date of the posting of the approved bond. Any assessment of tax, interest, penalties, fees, or costs related to the payment of such refund claim shall be made within three years after the date that such refund was paid by the commissioner.
Status: Signed into law by the governor on May 5, 2009; effective 5/5/09

HB 482 – Removing The Tax On Business Inventory, exempts all the inventory of a business from state ad valorem taxation. A referendum needs to been held on this bill to enact the legislation.
Status: Signed into law by the governor on May 4, 2009; referendum needed in 11/10 to affirm

HB 485 – Jobs Tax Credit for Retailers Increasing Port Traffic, sponsored by Representative Larry O’Neal, (R) 146th, would grant any business enterprise located in a tier two or tier three county which has a distribution facility of greater than 650,000 square feet, and which was in operation in this state prior to December 31, 20098; and which distributes product to retail stores owned by the same legal entity or its subsidiaries as such distribution facility; and has a minimum of 8 retail stores in this state in the first year of operations; and has increased its port traffic of products during the previous 12 month period by more than 10 percent above its base year port traffic is qualified to claim a job tax credit for jobs created before January 1, 2015.
Status: Signed into law by the governor on May 5, 2009; effective 5/5/09

HB 529 – Preventing Local Regulation Of Regulating Farm Products, precludes any municipality or other political subdivision from adopting or continuing any ordinance, rule, or regulation, which would regulate the production of agricultural or farm products on any parcel of land five acres in size or greater.
Status: Signed into law by the governor on May 1, 2009; effective 5/1/09

HB 581 – Job Creation Act, provides incentives to employers for complying with the Employment Security Law and establishes a credit to employers for hiring unemployment claimants.
Status: Signed into law by the governor on April 21, 2009; effective 4/21/09

RETAIL RELATED BILLS VETOED BY THE GOVERNOR

SB 123 – Defining and Licensing Pharmacy Benefit Managers, sponsored by Lee Hawkins, (R) 49th, Jack Murphy, (R)27th, Ralph Hudgens, (R) 47th, Don Thomas, (R) 54th and Tommie Williams, (R) 19th, would define and provide for the regulation and licensure of pharmacy benefits managers by the Commissioner of Insurance.
Vetoed on May 11, 2009

HB 481 – The Jobs Act of 2009, sponsored by representatives Tom Graves, (R) 12th, Mark Burkhalter, (R) 50th, Jerry Keen, (R) 179th, Earl Ehrhart, (R) 36th, Tom Rice, (R) 51st, and Tim Bearden, (R) 68th, would:
• Create a quarterly tax credit towards the unemployment insurance tax for each eligible employee hired. This credit would be applied towards the employer’s future unemployment insurance contributions for the hiring of someone who is receiving state unemployment benefits.
• Create a $2,400 income tax credit for each eligible employee hired. This credit will be available to those who hire an employee that has been unemployed for at least 4 weeks and remains employed for at least 24 weeks. To receive the credit, the employee’s initial hire must be prior to July 2010.
• Start a “New Business Tax Holiday.” Under this legislation, the $100 fee will be waived for all new businesses formed over the next year. This component would create a 1 year “holiday” on new filings for LLC’s, Limited Partnerships, and For Profit Companies.
• Phase out of the Sales Tax Deposit. This section of the Act phases out an outdated tax on Georgia business capital. This is a fee charged to all Georgia businesses which have $5,000 or more in sales tax collections each month. Taking the average sales tax collection amount each month, the DOR requires the business to forward fund a deposit of working capital. This deposit is held for perpetuity or until the business fails, whichever comes first. Phasing out this deposit will put much needed capital back into Georgia’s businesses.
• Abolish the Net Worth Tax. This tax was originated in 1931 and charged to all businesses based on their net worth. It’s a deterrent to savings and investment in assets. Currently, even businesses that have a negative net worth are taxed.
• Cut the Capital Gains Tax in half. This tax is charged to all individuals and businesses that save and invest in assets, whether its stocks, certificate of deposits, savings accounts, collectibles or real estate. This provision would provide a deduction of 50% of all Long Term Capital Gains from an individual’s taxable income.
Vetoed on May 11, 2009


This Year the Georgia Retail Association tracked nearly 140 bills that would, if enacted into law, have some impact on the retail sector. Please remember, bills introduced in 2009 remain alive for the 2010 session. For details on these bills please link to: http://www.georgiaretail.org/governmentaffairs/documents/18CRRDetail_May_21_2009_000.pdf


QUOTE TO PONDER

"Liberty has never come from the government. Liberty has always come from the subjects of government. ... The history of liberty is a history of the limitation of governmental power, not the increase of it." Woodrow Wilson


Thank you,

John C. Heavener, MSM, CAE
President, Georgia Retail Association

For More Information Contact:
johnh@georgiaretail.org
Telephone – 770-484-3449, ext. 21
Toll Free - (877) 427-3824
Fax – 770-484-5727
www.georgiaretail.org

About GRA: The Georgia Retail Association, with membership that comprises all retail formats and channels of distribution including department, specialty, discount, catalog, Internet, independent stores, and grocery stores has been serving the state’s business community since 1961. The Georgia Retail Association represents an industry with more than 71,300 retail establishments, and more than 715,000 employees - about one in five of Georgia’s workers – with annual sales of more than $115 billion.

Printer Friendly CRR May 21, 2009