ATLANTA -- The House nearly killed a tax break today for out-of-state airplane owners and developers of resorts and amusement parks.
It took three roll-call votes and for House Speaker David Ralston to cast a rare vote to save House Bill 234. Now it heads to the governor for his decision, and the previous governor vetoed the tourism tax break three times.
Thursday’s action came early on the final day of the 2011 legislative session.
Rep. Ron Stephens, chairman of the House Economic Development & Tourism Committee, sponsored the bill and asked his colleagues to agree to the version of it passed by the Senate Tuesday. The Senate Finance Committee took the airplane-owners bill that the House had already approved and amended it with one of Stephens’ bills dealing with tourism that had stalled in the House Ways & Means Committee.
After the whole Senate voted on the amended version, Democrats grew upset hours later when they realized that the amendment hadn’t been explained to them.
“From what I’m hearing, this was done for one specific developer,” said Sen. Vincent Fort, D-Atlanta. “... It just seems like back-room dealing and corrupt bargaining.”
That feeling apparently simmered during Wednesday’s recess, allowing opponents to gather their forces.
It was a pair of conservative, South Georgia Republicans and a Middle Georgia independent that launched the attack Thursday morning.
Stephens, a Savannah Republican, said the amended version of the bill was a combination of two measures that had each passed the House on multiple occasions.
The provision for airplane owners extends for two years an existing sales-tax exemption on repair parts as a way to entice them to Gulfstream Aerospace in Savannah, Standard Aero in Augusta or Pratt & Whitney in Columbus. It only applies to planes registered out of state since they could merely fly for repairs to one of the other states that doesn’t charge a sales tax, putting in danger thousands of Georgia jobs, he said.
The provision for developers applies to projects of $1 million or more that attract at least one-fourth of their business from out-of-state tourists. If the governor approves, the developers could get one-fourth of their investment back from sales taxes the state gets during the first 10 years after the project opens for business.
Rep. Jason Spencer, R-Kingsland, unseated Cecily Hill in last year’s Republican primary by attacking her for sponsoring the tourism-development bill in the 2010 legislature. He questioned Stephens on the floor about the policy of diverting taxes collected from the public to benefit individual developers.
“I had to follow through on my stance on the issue,” Spencer said.
Stephens responded that the state could get back its money if the developer’s promises don’t come through.
“If they don’t do what they say they’re going to do on the tourism destination and create the number of jobs they say they will, we’ll be able to claw back (the tax benefits) and go back into our general fund,” Stephens said.
Rep. Mark Hatfield, R-Waycross, was more blunt.
“It’s legalized extortion; that’s what it is,” he said.
He challenged the bill on procedural grounds and ran into Ralston’s wrath. Hatfield argued that the airplane-parts bill came to a vote in the House under a rule that prohibited amendments, and that rule forces a conference committee if the Senate adds an amendment.
Ralston pointed out that the speaker can make an exception and brusquely reminded Hatfield he has had 40 days to read the rules himself.
Stephens’ motion to agree to the Senate version originally failed by 10 votes. Then he asked for a roll-call vote on whether the House should reconsider its defeat of the bill, and that request passed by just two votes.
When the House did actually reconsider, or vote again on passing the bill, the measure came up one vote short on the lighted score board until Ralston cast his vote for it, giving it the necessary 91 “yes” votes.