State agency officials in Georgia will have until Sept. 6 to come up with a plan to cut spending by 4 percent in 2020 and by 6 percent in 2021.
Gov. Brian Kemp has instructed agency heads to submit amended budget proposals that reflect the cuts along with their 2021 budget proposals.
The call for reduced spending comes weeks after Kemp announced a tax revenue surplus in the state and touted job growth.
“It's a great time to be a Georgian. Job growth is breaking records, companies from all around the world have the Peach State on their minds, and our ports are firing on all cylinders,” Kemp said in a statement, adding that he wants to ensure that the economy stays secures and “streamline operations” by "cutting waste and ending duplication.”
It was part of his campaign promise to help Georgians first, Kemp said.
According to a Kaiser Family Foundation report published recently, Georgia ranked 42nd in total state expenditures per capita in 2017.
The state ended the 2019 fiscal year on June 30 with a nearly 5 percent tax revenue increase over the previous year. Georgia added 22,000 jobs in June. Major companies like Amazon and Swiss manufacturer Preci-Dip, among others, selected the state as a launch spot for new facilities.
Georgia’s unemployment rate also dipped in June to at 3.7 percent, which is the same as the national rate, according to Georgia’s labor department.
Office of Planning and Budget Director Kelly Farr sent a letter with instructions to agencies on Wednesday.
“Growing revenues does not mean growing the size of the government,” Farr wrote. “Instead we must seek as many dollars in taxpayers’ hands as possible to grow our economy instead of state government.”
Office of Planning and Budget staff will work with the agencies to determine the impacts of the reductions and if any programs will be exempted.
Corey Burres, spokesperson for the nonprofit, free market Georgia Center for Opportunity, said it is possible that the tax revenues could decrease or stay flat in future months.
Tax revenues peaked in June 2018 when they finished up by 7 percent, nearly $146 million. But May's revenue saw a 0.1 percent increase ($1 million) over May 2018.
Burres said there's also concern over the scaling back of federal support for state programs "in the near future."
Critics of the plan are more pessimistic about the impact of the cuts.
“I think it's popular to discredit any government spending as wasteful or inefficient,” wrote Stephen Owens, senior education policy analyst at the Georgia Budget & Policy Institute on Twitter Wednesday. “The reality is that while it may take a while for the typical citizen to feel it, we will all be impacted by the loss of funds.”
Owens, who worked at Georgia Department of Education for three years, said the staff is overworked because of underfunding.
“If the DOE has to reduce spending by 6 percent, that could mean one out of every 17 employees being fired,” Owens wrote.