Nov 29, 2017
Georgia Update: The 2018 Legislative Session
Looking ahead to the 2018 legislative session, two key dynamics will drive
much of the activity. First, it will be Gov. Nathan Deal’s last session to
move major policy issues forward as he finishes his second term in office.
The Deal team is adept at maneuvering the legislative process, so
anticipate significant efforts around his key priorities of education
reform, economic development and criminal justice reform.
Second, the session will progress in the shadow of the May primary for all
statewide offices, including the races for governor and lieutenant
governor. Because many of the candidates also will be actively serving in
the legislature, it is a safe bet that issues appealing to the primary
electorate (particularly the Republican primary electorate) will be front
Following are some of the key issues expected to see debate next year:
The state continues to perform well economically, and this continues to
result in a generally stable budget situation. The legislature likely would
be considering significant forward movement on spending in new priority
issues, were it not for two factors. The first is a growing gap between
pension funding and pension obligations for state employees and teachers.
The second factor is growth in medical costs for the state employee health
plan that continue to significantly exceed member contributions. Combined,
these mandatory spend items will consume much of the available new funding
on the cash side of the ledger. Due to the state’s strong credit position,
expect to see another substantial bond package to fund a range of
infrastructure priorities. Economic growth also will positively impact the
availability of funding for state transportation needs since that money is
largely earmarked for transportation purposes only.
Incrementalism will be the word of the day when the legislature starts to
look at changes to the Medicaid program. The state Senate finished a round
of hearings on this topic around the state, and heard a great deal about
the need to increase provider payments, implement new telehealth
technologies and consider limited waiver-driven expansion programs to cover
specific needs, such as opioid addiction and mental health. Additionally,
the state is now embarking on replacement of its Medicaid Management
Information System with a new modular approach, which will reshape the way
the Medicaid program is technically delivered to providers and members.
Because of the interplay with the Centers for Medicare and Medicaid
Services on any changes — and the lack of global progress in the health
reform discussion in Washington — the outlook for specific policy changes
coming out of this discussion remains unclear.
Certificate of Need
This session likely will feature more discussion of Georgia’s Certificate
of Need program than has occurred in recent years. Continued challenges
with operating smaller rural hospitals have opened a debate about whether
these laws are preventing restructuring of small hospitals and creation of
urgent and emergency care facilities that can provide immediate care at a
lower total cost. Additionally, the competitive Atlanta hospital operating
environment may have some large organizations considering changes to enable
expansion for their physician groups. Several other CON issues have been
brewing for some time and will get legislative attention. Given the general
opposition of most Georgia hospitals to any change, this will be another
hard-fought issue in 2018.
In the wake of Atlanta’s new sales tax to fund transit expansion, several
other metro Atlanta jurisdictions are considering similar changes to remain
economically competitive and reduce traffic congestion. These jurisdictions
include DeKalb County, Fulton County and Gwinnett County. At the same time,
legislators continue to examine broader governance models for transit in
the metro Atlanta region. Whether any of these jurisdictions are successful
will depend largely on whether they built strong legislative support around
their proposals prior to the legislative session.
As the national fight around local compliance with U.S. Immigration and
Customs Enforcement detainers heats up in Georgia, expect
immigration-related legislation around this issue to emerge quickly in
2018. Given the intensity of this issue with Republican primary voters, the
odds are relatively high that a bill will pass.
Speaker David Ralston put a great deal of personal effort into leading a
task force looking at issues that need addressing to keep rural Georgia
economically competitive. Rural broadband access is front and center in
this debate. On the more controversial side, some proposed letting electric
co-ops enter the broadband business. Also discussed were proposals to
reduce regulatory burdens for installation and lower the sales tax on
broadband equipment. While policy details are still taking shape, the odds
of a major package dealing with this issue moving next year are very high.
This session almost certainly will feature debate on legislative proposals
pitting the business community against social conservatives. The most
prominent candidate is an effort to codify the federal Religious Freedom
Restoration Act, which many businesses, activist groups and motion picture
companies have identified as catastrophic from a business growth and
community branding standpoint. Other permutations of this general issue
have been debated as well, including new regulations around faith-based
organizations that receive public funding to provide adoption and foster
care services. Gov. Deal opposes any moves in this direction, which will
make enactment of such legislation unlikely, at least in the 2018 session.
Regardless, it will be a major point of debate.
A Senate study committee spent time in the off-season examining the tax
credits and deductions that are on the books in Georgia. While the Senate
cannot start tax bills, the general is that there is a pretty strong
appetite to implement some kind of regular sunset and/or review process for
these programs. It is unclear at this point whether the House would be
inclined to move in this direction. Additionally, there continues to be
concern about Georgia’s recently revamped auto tax program and its impact
on the leasing business. Finally, expect that debate around taxation of
emerging industries, from online software and books, to retails sales and
rideshares, will continue as new economic ideas collide with old tax laws.
Legislative conservatives are clamoring to vote on “Constitutional Carry”
legislation, which essentially negates the requirement to get a permit
before carrying a firearm in public. The actual parameters are not yet
available, but in a primary election year, there’s no ruling out movement
on another piece of firearms legislation.
The two-year-old fight among insurers, patient advocates, hospitals and
physicians around billing for surprise out-of-network services will
certainly continue for a third year. All parties involved agree the
practice should be curtailed, but there is little agreement on how to do
so. Generally, the debate revolves around what standard to use as the floor
for out-of-network charges when the patient has no opportunity to consent
to them in advance.
The discussion about gaming in Georgia will certainly continue next year.
In general, the success of these efforts will depend on whether there is a
new program or existing fiscal need that is compelling enough to get
lawmakers who are concerned about the political implications of this issue
to want to put it in front of voters. While primary election pressures make
this a challenge, existing fund sources cannot meet the needs around rural
healthcare, opioid addiction and other priorities, so many legislators will
continue to look at gaming as a potential solution.
As Georgia moves forward with a nuclear power expansion, some level of
legislative attention will focus on the topic. However, the debate around
financing is largely assigned to the Public Service Commission, so major
legislative movement in the area is unlikely. A related issue concerns
disposal of coal ash residuals from other states in Georgia landfills.
Federal constitutional limitations outline what Georgia can do on this
issue, but that will not deter concerned legislators from seeking a path
This is just a sampling of the major issues expected to consume time and
focus moving forward into the session. As always, if you have questions
about any of these issues, please contact a member of McGuireWoods
Consulting’s Georgia team.
For additional information, please contact Ashley Groome or a member of McGuireWoods Consulting’s Georgia State Government Relations Group.
Ashley S. Groome, Senior Vice President and Director
Joshua N. Albert, Vice President
Brad L. Alexander, Senior Advisor
Robert L. Fortson, Senior Vice President
Lauren C. Greer, Assistant Vice President
Misty H. Holcomb, Senior Vice President
Eric Johnson, Senior Advisor
Zachary I. Johnson, Assistant Vice President
Danica R. Key, Assistant Vice President
Victor L. Moldovan, Senior Advisor
Russ Pennington, Vice President
Michael T. Shelnutt, Senior Vice President
William M. Talmadge, Assistant Vice President