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Thursday, February 25, 2010

By: Brian D. Anderson Sr.
President & CEO
Dalton-Whitfield Chamber of Commerce

A Day at the Capitol

Last week the Leadership Dalton-Whitfield Class of 2010 visited the Capitol for its legislative session. Through the hard work of Steve Pound (VP – Human Resources, Hamilton Medical Center) and Phyllis Stephens (VP – Leadership Development, Dalton-Whitfield Chamber), a very productive and informative day was enjoyed by all. And due to the efforts of our hosts, Senator Don Thomas, Rep. Roger Williams, and Tom Dickson who all contributed in making this special visit to the Capitol possible.

Soon after arriving at the Capitol, our local delegation had arranged for briefings from Lt. Governor Casey Cagle, Speaker of the House David Ralston, Senator Jeff Mullis (Chairman, Senate Transportation Committee), and many others. These briefings included individual insight into what each elected official expected the legislature to focus on during the session among other topics. Each allowed the group to ask questions and attempted to answer them candidly and with adequate detail.

Interestingly what captured my attention after hearing from three or four different elected officials was not the legislative topic or issue; it was the tone and tenor of the discord. I am happy to report that the in previous visits under different leadership, you could visibly see the rancor or the divisiveness that permeated the three different branches of state government. Although I am hesitant to laud too much credit on the new speaker, he is the only thing that has changed since the last session. After hearing the Speaker discuss so openly about the goals of the House for this session and his plans for working collaboratively with the Senate and Governor, I came away encouraged that much can be accomplished.

This year’s visit was extra special in that we had a very special guest with us. Carlos Anliker from El Salvador, an exchange student studying at North Georgia College and University and a participant of the Georgia Rotary Student Program, joined the Leadership Dalton-Whitfield delegation. The Dalton Rotary Club sponsors Carlos. After discovering that he has political aspirations in his home country, it seemed appropriate to invite him to join us for such a wonderful VIP visit to our State’s Capitol.

I want to thank this year’s LDW class and the LDW Leadership for allowing Carlos to join us and for welcoming him so graciously. We were even able to get his picture taken with many of our State’s leaders.

I must tell you that it was refreshing to visit this year with someone who was innocent of cynicism and approached the visit with such respect for the process and the freedom that our system represents. As one who visits the Capitol often and gets frustrated by the partisanship, the political gamesmanship, and the basic inability of our elected officials to solve our problems, it was truly refreshing to be with someone who appreciated so much what many of us take for granted. After such a good day at our State’s Capitol, it would not surprise me to one day learn of Carlos’ entry into the political process in El Salvador.

As write this column, our Legislature is on recess working for two solid weeks on the 2010-2011 budget. I do not envy the daunting task before our state elected representatives. Every month, since the beginning of the current fiscal year, has seen a decline in state revenues. At the end of January the state had collected $1.6 billion less this year vs last year. The FY10A budget only assumes a $1.35 billion shortfall. Unless revenue collections grow throughout the balance of the remaining months in the 2010 budget year, the state will end the year with a $235 million deficit.

Given that Medicaid spending and Education drive so much of the state’s budget, the task before our elected officials is extremely difficult. And given that the current budget and the 2010-2011 budget includes Stimulus funding, balancing the state’s budget once those resources are gone will be even more difficult.

One member of the LDW delegation asked Senator Chip Rogers about the possibility of eliminating the corporate income tax (Ohio recently did just that). Surprisingly Sen. Rogers answered that Georgia received very little actual revenues from the Corporate Income Tax in 2009-2010, he was still hesitant to consider that option as a valid possibility for spurring economic development / recruitment of new business for Georgia. It would seem that if revenues are minimal during these times, the elimination of this tax could be the right tool for recruiting new corporate investment in Georgia.

All in all, we had a good “Day at the Capitol.” Once again, Phyllis and her volunteer leaders organized and executed a productive day for this year’s class. Having Carlos from El Salvador certainly added a bonus for me and our group. Again, a big THANK YOU to Sen. Thomas, Rep. Williams, and Rep. Dickson for all of their efforts in coordinating this visit. We wish all of our elected state officials all the best as they work hard for the betterment of Georgia.

Thursday, February 11, 2010

The "Sick" Tax

By: Brian D. Anderson Sr.
President & CEO
Dalton-Whitfield Chamber of Commerce

The “Sick” Tax

Your Chamber’s Legislative Action Committee kicked off its weekly deliberations this past week. For those of you who have not previously participated in this process, we will have 25-35 people from our member-investors meet every Wednesday from now throughout the legislative session to review legislation, vote on a position to support or not to support the legislation, and to forward our official positions to our legislative delegation. We will also have a conference call with our legislative delegation every other Wednesday.

The session has started with a flurry of activity. Part of the reason for so many pending pieces of legislation so early in the process is due to this being year two of a two year session. So all legislation not acted on last year is automatically eligible for consideration this year. An overview of current legislation under consideration was recently sent to me by the Mathews and Maxwell Agency. According to this legislative summary, there are 61 bills under consideration that are healthcare related.

These 61 bills are divided between four groups: General Healthcare, Pharmaceuticals, Public Health, and Trauma Care. Given limited knowledge of all 61, and limited space to make a few points in this column, I will focus on two primary areas of concern. These two include the Hospital Bed Tax or “Sick” Tax, and the various bills targeted at providing funding for Trauma care.

Governor Perdue included in his 2010-2011 budget a Hospital Bed Tax or “Sick” Tax. The Governor’s proposed tax is to help fill the gap in Medicaid funding that is estimated to be over $500 million. The Governor has offered an alternative to the 1.6% tax on total revenues from the state’s hospitals – a 16% reduction in Medicaid reimbursements from the state.

To my knowledge this recommendation from the Governor has only been through his submission of his budget and an actual bill calling for the tax has not been introduced. Our committee will study the bill (as we do all important legislation) once it is introduced. We will then formally communicate our position once approved by the committee. But suffice it to say, I will be shocked if we do not oppose this type of legislation.

It is easily understood the difficult position that the Governor and the Legislators are in. They have a tough job every year but especially this year given the devastatingly declining revenue trends. The State’s revenue is woefully below projected needs. Medicaid / healthcare costs are skyrocketing and consistently absorb more and more of the state budget. It seems obvious to target raising the revenue from within the budget area needing the money.

But once a 1.6% tax is applied to hospital revenue this year, what will prevent the legislature from increasing this tax to 5% next year. And if this is the most appropriate way to raise the needed revenue, why would the structure of the legislation create winners and losers within the state’s hospitals. For instance, current projections forecast that this legislation will provide a multi-million dollar windfall to Grady Hospital in Atlanta while our local Hamilton Medical and Murray Medical would lose approximately $3 million annually. Good legislation should provide mutually-beneficial results for all affected, not create winners and losers.

And at the end of the day, who pays the hospital bill anyway? We do. The hospitals will simply pass on the tax in increased fees. And those with private insurance will simply pay more through higher charges and insurance premium increases. Isn’t it odd that a republican Governor and a Republican controlled legislature seems to think that indirect taxes like the “sick” tax and those approved through a public referendum such as a transportation sales tax are not tax increases?

The other area of concern in the healthcare arena is funding for trauma care. Let’s just say Georgia is not known for having adequate levels of trauma care. And to increase trauma care in any meaningful way will cost money. This issue received much fanfare last year and will more than likely receive ample attention again this year. The Chamber Legislative Action committee will also be watching this issue as it is debated in the session. Good recommendations are being and have been introduced that will insure Georgians have access to good regional trauma care options. This is a matter of life and death and our state elected officials need to lead by implementing good legislation regarding trauma care.

Although Healthcare reform seems stalled at the federal level, and Georgia officials have much to consider, healthcare will continue to costs a tremendous percentage of all discretionary revenue. Our officials must work together in presenting, debating, and approving the best of all ideas.

Your Chamber of Commerce takes our legislative advocacy mission very seriously. We are grateful that our member-investors participate so enthusiastically in reviewing legislation and making our positions known. If you would like to participate, please contact me or Phyllis Stephens at the Chamber.

Friday, February 5, 2010

Who can we trust?

By: Brian D. Anderson Sr.
President & CEO
Dalton-Whitfield Chamber of Commerce

Who can we trust?

A couple of nights ago, I happened to be home in time to watch the NBC Nightly news. I will admit I rarely watch network news anymore. Unfortunately the national media is no longer trustworthy to present, as Sgt. Joe Friday of Dragnet used to say, “just the facts”. I firmly believe all of the national news media now report with a bias toward one party or the other. It doesn’t matter which political party you support, you will have a media outlet reporting in a way that courts you. So it is obvious that trusting the media is risky at best.

But I digress; the “news story” was actually explaining that President Obama, Secretary of Defense Gates, and the top leadership of the US Air Force had tried to cancel future orders for the Air Force cargo plane – the C-17. Although this is a widely used and wonderfully performing cargo plane, the administration and the Air Force brass in evaluating the needs of the Air Force found that additional purchases were not needed.

Who then is forcing the purchase of planes we do not need. If you guessed Congress, ding … ding … ding… you win. At least according to NBC News, Congress is the cheerleader of this once-again wasteful spending. You are probably asking, why Congress is overriding the military experts, the civilian appointed and Senate approved Secretary of Defense, and the President.

Did you know that all the parts that are put together that ultimately make the C-17 airplane are produced in over 35 states? And to stop producing this plane, would put a lot of people in many of the state represented by our esteemed members of Congress out of a job. Now, as an economic development professional, I know full well the ramifications of closing plants. And it doesn’t take a rocket scientist to know that the last thing our economy needs right now is more plant closings and unemployment.

But what happens to a market economy that is “monkeyed” with for political gain. If keeping people employed is so important regardless of the jobs being needed, why shouldn’t the US Government order new carpet for every home and business in the US? We could put thousands of people back to work and actually make a product that is needed by many and would be useful. The President also stated that Congress’ insistence on purchasing these planes would adversely affect our military men and women. Because Congress wants to buy planes that are not needed, other equipment and critical needs by our service men and women could become scarce.

I have already written a column bemoaning the current healthcare reform legislation. Not because healthcare doesn’t need reforms, but because those that are writing the rules cannot be trusted. Not only are they not debating all the issues or seeking qualified input from all parties / sides of the problem, they are cutting deals for votes. Some would even argue legal bribery is at play that may be criminal or at least unconstitutional.

Recent elections and failures by the majority party (regardless of which party was in control) have created anger from many American citizens. Most are simply tired of the back room deal making, the buried pork and special earmarks, and other shenanigans demonstrated by the members of our Congress.

The most effective government is the one closest to the people. And although it could be argued that even state government is too far from the checks and balances afforded by the ballot box, it is certainly more influential than the protective barrier afforded our incumbent members of Congress. Unfortunately we have allowed such usurpation of power by the members of our Congress, I am not sure we can easily shift the balance of power back to state governments.

One recent example of someone at the state level understanding the plight we are in is the chastisement Gov. Schwarzenegger of California gave his State legislature. He challenged the California Legislature to ask their federal representatives and senators from California when their state would get a sweetheart deal like Nebraska and Louisiana. All states that did not receive a sweetheart Medicaid package in exchange for their vote on Healthcare reform should seriously challenge the integrity and honor of those who did receive them.

So, who can we trust? Although we know there are honest hard-working elected officials in Washington, the culture is plagued with dishonesty, and is generally dysfunctional. How can we change the culture to one of civility, humility, and doing what is right for all Americans? One answer could be to shift the majority of the power back to the states where the elected officials are closer to the voter. Another is campaign finance reform. Why does a state elected office campaign o cost hundreds of thousands of dollars for someone to seek that office?

And finally another possible answer is wholesale change. By sending new blood to Congress, allegiances to special interest groups and past favors given by them could be diminished. Those with new ideas might be more willing to work with those with different opinions and not hardened by deep partisan politics. And maybe with a wholesale turnover, the seniority system that gives us a Speaker Pelosi and Senate Majority Leader Reid could actually produce someone from the middle and not the extreme. Maybe we could actually have leadership that could get the work of the American people done.

Who can we trust?