Governor Nathan Deal - Georgia’s 82nd Governor (2011-2019)

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Deal: Focus on foundations that strengthen Georgia

January 17, 2013

Lt. Governor Cagle, Speaker Ralston, President Pro Tem Shafer, Speaker Pro Tem Jones, Members of the General Assembly, Members of the Judiciary, my fellow Georgians: 

To the Members of the General Assembly, congratulations on your election. To the new members of the House and Senate, welcome! You are now part of one of the greatest and most successful experiments in the history of mankind, the process of self-governance, whereby free people entrust to us the responsibility of preserving their freedoms. 

We do so if we confine our actions to those things which our constituents cannot do for themselves. Our constitution defines some of the things we shall do, as well as some of the things we shall not do. Between those goal posts of shall and shall not lies the field on which we play. It is not a Field of Dreams but a Field of Law. Like spectators in the stands of a great stadium, a cacophony of voices will tell you what play to run and agree or disagree with your performance. Just remember, we are all on the same team with you, and we share a common purpose of making Georgia the best place to work, play, get an education and raise a family. 

Last year, I told you that I had a goal: To fulfill the truest purposes of government – the ones for which Georgians need their government most – “and then get out of the way so that they can live their lives in freedom and as they see fit.” 

So far, I believe we have done that well. We have made communities safer, improved educational opportunities, provided for infrastructure improvements, driven workforce development, generated a better business environment and created jobs. Together, we have implemented innovative tax reform that incentivizes business growth, passed smart-on-crime criminal justice reform and saved HOPE. 

This year, I challenge you to join me as we go forward with a focus on progress. While times have been tough and we have had to make difficult choices, I will not lead our state with a Doomsday mindset, reacting erratically and hastily based on fear or ignorance. Instead, we will move forward with confidence, focusing on the proven foundations of a growing Georgia, those that keep us steady during times of uncertainty but also during times of prosperity; foremost among these are public safety, education, healthcare and economic development 

Just as Georgia is too big and too important to fall prey to Doomsayers’ pessimism, it is also too big and too important to be divided by race, geography or ideology. This year, let’s concentrate on the things on which we can all agree: The foundations that improve the lives of our citizens and undergird the bright horizons of tomorrow. 

In the first foundation, Public Safety, let’s capitalize on the success that we have already had in criminal justice reform, in which, last year, we crafted legislation that saves both lives and taxpayer dollars. Through increased use of accountability courts – drug, DUI, mental health and veteran courts – along with other measures, this state will avoid the need to add 5,000 prison beds over five years and save taxpayers at least $264 million; these measures simultaneously decrease the number of offenders who end up back in jail after being released – and create productive, taxpaying citizens rather than more dangerous criminals. And we have continued funding for accountability courts by allocating $11.6 million toward that purpose in my budget proposal.

This year we will continue our work by bringing legislation designed to produce better results with juvenile offenders and divert them from the adult system. I want to thank the Special Council on Criminal Justice Reform for Georgians for their hard work over the past two years. I urge your strong consideration of their recommendations for the Juvenile Justice system. Similar to last year, we would emphasize community-based, non-confinement correctional methods for low-risk offenders as an alternative to regional and state youth centers. To get started, I will be requesting $5 million in the FY 2014 budget to create an incentive funding program that encourages communities to create and utilize these community-based options.  These options range from substance abuse treatment to family counseling and provide judges with viable, alternative sentencing options.  Just as with last year, we stand to lower recidivism and save taxpayer dollars. For example, are you aware that the cost of each bed in a Youth Detention Center is in excess of $91,000 each year? It is certainly an area where less costly options must be used. Together, we can continue to improve our state’s justice systems while keeping our citizens safe by reserving our prison beds for violent offenders. 

This year provides another opportunity to bolster public safety.

This past summer, Georgia witnessed several tragic accidents on our waterways. 

We know alcohol is involved in over 50 percent of all boating fatalities each year. On Georgia’s roads, if the operator of a vehicle has a Blood Alcohol content of .08 or higher, he can be charged with Driving Under the Influence. However, you cannot be charged with Boating Under the Influence unless your Blood Alcohol level is .10 or higher. The Jake and Griffin Prince BUI Law that I am proposing will change that. If you are too drunk to drive an automobile, you are too drunk to drive a boat! 

I will also propose, through the Kile Glover Boat Education Law, that you place age limits and educational requirements on young operators of boats and personal watercraft and that children who are 13 or younger must wear life jackets when riding in an open boat that is moving.              

Another foundation block for growing a more prosperous Georgia is education. Since we are talking about foundations, let’s talk about our earliest learners, who build upon what they learn today for the rest of their lives. We have an outstanding pre-K program that has been nationally recognized. This past year, the National Institute for Early Education Research awarded Georgia its first 10 out of 10 in measures of quality; we were one of only five states to receive such a designation.  

In the budget for FY 2014, I have added 10 days to the pre-K school year, thereby restoring it to a full 180 days and increasing the salaries of deserving teachers. 

Last year, we focused on literacy by designating $1.6M to establish a reading mentor’s program that was designed to grow the percentage of Georgia’s children who are reading on grade level by the third grade. Early indicators are proving it a good investment. We must not let our children fall behind, for that is a path toward remediation and delayed success. As such, I have included $1.6 million in this year’s budget to continue the reading mentor program.               

While most state agencies have seen their budgets for the remainder of this fiscal year and for the FY2014 reduced by an average of 3 percent, K-12 education was not subject to these reductions. In fact, the budget will give $156M in additional funding for enrollment growth in K-12 schools in FY2013.  For next year, there will be $147 million for enrollment growth and salary increases for teachers based on training and experience. There is also an additional $41 million to fully fund the revised Equalization formulas adopted last year. 

We must continue to make K-12 education a top priority, because Georgia recently ranked 45th out of the 47 states that reported graduation rates under the cohort method. This is unacceptable! We can do better! We will do better! 

The people of Georgia spoke loud and clear when they adopted the Constitutional Amendment on Charter Schools by an overwhelming margin. The message they sent was this – They are not satisfied with the status quo! And neither am I! 

We have been funding public education under the Quality Basic Education legislation, QBE. This is a 1985 formula that does not meet the needs of a 21st century classroom. While adjustments have been made, as recently as last year, more needs to be done. As we finalize the pilot projects and reforms being produced by our Race To The Top initiative, I look forward to modernizing the way we spend tax payer dollars so that we can produce more positive results in our public schools. Public distrust emanates from poor graduation rates, excessive remediation expenses and substandard test scores. Dedicated educators deserve to have this stigma removed. If we don’t do that, we will discourage the bright college students who want to be teachers from choosing that profession. We cannot afford that loss!

Georgia has had too many school boards placed under the sanctions of potential loss of accreditation. While this is a very serious matter, it is somewhat ironic that the loss of accreditation can only be based on governance issues and not on substandard academic progress of the school system. Unless this is addressed by state legislation, we will continue to have thousands of Georgia’s children trapped in underperforming schools through no fault of their own. I look forward to working with you to solve this problem. In education, as in most areas of life, poor outcomes are most often not the result of lack of money, but lack of vision and leadership. 

One of the primary reasons for getting an education is to get a job. To the parents of children who contemplate dropping out of school, you should remind them that they are condemning themselves to the lowest rung on the employment ladder, and you should prepare them to continue to live at home because the jobs that will be available to them will be few indeed.                

Since employment is a primary goal of education, I want to commend the Chancellor of our University System and the Commissioner of our Technical College System for evaluating and refocusing their programs of study to give priority to those educational paths that have a proven record of employability. It is a tragedy when a young person works hard, accumulates debt for student loans and then graduates with a diploma in a field where there are no jobs. 

My budget proposes to focus more funds within our HOPE Grant Program toward occupations where we know jobs are available and shortages actually exist. Currently, there are several thousand jobs available for individuals with a commercial driver’s license. There are similar shortages in the areas of nursing and early childhood education. In order to fill these vacancies we suggest directing additional funds within our Technical College HOPE Grants so that over 90 percent of the tuition costs in these programs will be provided. That’s Putting Your Money Where The Jobs Are!                

Two years ago, we worked together to save our HOPE Scholarship program. As a result, it remains one of the most generous state run scholarship programs in the nation. It is also keeping our best and brightest students in Georgia. In FY2011, more than 97 percent of entering in-state freshman at both the University of Georgia and Georgia Tech received the Hope Scholarship. 

Today, I am happy to say that my budget will increase the Hope Scholarship by 3 percent over last year, bringing the total funds going to Hope in FY 2014 to nearly $600 million.

This is quite a contrast to the proposed bankruptcy of HOPE that was projected to occur this year. That’s why I say, together, we saved HOPE! 

Also, in keeping with our emphasis on results based funding, I would like to thank the Higher Education Funding Commission for its hard work over the past year to provide us with a solid recommendation that will be the starting point for change from enrollment-based funding to outcomes-based funding in our university and technical colleges. I encourage you to join me in fully considering their recommendations.

Another foundation block for a growing and prosperous Georgia is healthcare.

I want to thank the Commissioner of Agriculture and the Commissioner of the Department of Public Health for their efforts to keep our citizens healthy and thereby minimize the need for expensive healthcare. Commissioner Black has launched the Georgia Grown program in which he is promoting agricultural products grown in our state. He is working with local farmers and school dieticians to increase the consumption of fresh fruits and vegetables by our school children. Commissioner Fitzgerald is one of the individuals leading the Georgia SHAPE program, which is educating and encouraging children regarding the importance of exercise. Both of these efforts will keep young people healthier and will reduce the scourge of obesity that abounds in our state. 

As a result of a downturned economy and the provisions of federal legislation known as Obamacare, we are seeing a growth in our Medicaid rolls. As you know, I have elected not to expand our eligibility limits for Medicaid. At the State Chamber of Commerce Eggs and Issues Breakfast yesterday, I elaborated upon the reasons for that decision. I did not judge it prudent to expand the eligible population of an entitlement program by adding an additional 620,000 new enrollees since our state is already spending approximately $2.5 billion in state taxpayer funds annually. 

Even without expanding the eligible population base, we expect our Medicaid rolls to grow by an additional 100,000 individuals. This new population of Medicaid recipients, along with other mandates of Obamacare such as the extension of the time between the review of eligibility, will raise our Medicaid costs by nearly $1.7 billion over the next 10 years. 

For FY 2014, I am requesting that you authorize the Board of Community Health to apply a provider fee for hospitals, just as they currently do for nursing homes. Unless this is done, there will be a shortfall in revenue to support the Medicaid program of nearly $700M. Since we cannot adjust benefits, the reduction in reimbursements to hospitals would be the only way to keep the program solvent. Those reductions would be approximately 20 percent, which would seriously jeopardize many of our state’s hospitals. Therefore, I urge your favorable consideration of this legislation. 

Last year, we appropriated $1.2M to expand residency programs for doctors in our state. I want to thank Dr. Ricardo Azziz, the President of Georgia Regents University Augusta, for leading this effort and the participating hospitals for making it possible for us to develop 400 new residency slots. We believe this is one of the best ways to retain medical doctors in our state. And the FY 2014 budget includes $2M in additional funds to further increase the number of health professionals practicing in the state.

The last foundation block for a prosperous Georgia that I will address today is economic development. For the last 2 years during this State of the State Address you have heard me say, “The state of our state is strong.” That statement is no less true today then it was for each of the two preceding years. In fact, it may be more true now when you consider employment numbers, increased job opportunities, revenue growth and the expanding prestige of our state in the international marketplace. 

We currently have the lowest unemployment rate we have experienced in nearly 4 years. It is still too high. That is why we must insist that every young person get a high school diploma; otherwise, they become the fuel that stokes the fires of the unemployment furnace. 

We are continuing to see promising job growth and many of these jobs are paying substantially above the average wage in our state. Since I stood before you last year at this address, we have announced more than 10,000 jobs, and many of these are on the high end of the employment scale. More and more businesses are deciding to make Georgia their home.  Some of the reasons for these decisions are government policies of low taxes and reasonable regulations. Together, we are showing the world that we are running state government the way it should be: in an efficient, common sense and businesslike manner. And clearly businesses are taking note of this!

We have spent taxpayer dollars wisely.  Using 2012 dollars, our per capita spending of government money is 17 percent less that it was a decade ago. And we currently have more than 9,000 fewer state employees than we had five years ago.                 

We have saved taxpayer dollars. The Revenue Shortfall Reserve, better known as the Rainy Day Fund, has been increased by 226 percent since I became Governor. 

We have reduced the burden on Georgia taxpayers. The Tax Foundation in an article published last month confirms that our state has decreased its state tax collections per capita over the last decade the most of any state in the nation, “collecting 25 percent less in real dollars than it did ten years earlier.” And last year, with tax reform, you lowered that burden again by increasing the deduction for married couples filing a joint return, bringing the total deduction to $7,400, thus virtually abolishing the so-called “marriage tax penalty.” 

There is good reason to believe our job base will continue to grow. Employers like to locate in a state that operates its own affairs in a businesslike manner. But it is not only businesses that pay attention to the fact that we have downsized state government and kept our budget balanced while not raising but actually lowering taxes. Others are watching our state operations, as well, like the three major bond rating agencies that have once again awarded a Triple A rating to Georgia. This comes at a time when some states and the federal government have experienced a downgrade in their ratings. This saves us taxpayer money by reducing the interest rate on our state bonds. 

The goal I have set for us is to make Georgia the No. 1 place in the country in which to do business. With Commissioner Cummiskey and his superb team at the Department of Economic Development, we are well on our way to achieving our goal. For two years in a row, we have ranked in the top five for business climate by Site Selection Magazine, and we ranked No. 3 for doing business in 2012 by Area Development Magazine. 

Our state is blessed to have the busiest airport in the world in Atlanta’s Hartsfield-Jackson airport. This provides us with rapid access to and from about 80 percent of the U.S. population within two hours. It is also one of the reasons certain businesses are coming to our state. 

Another asset is the Port of Savannah, the fourth largest container port in the country and the second largest on the East Coast. As you know, we have worked for many years to expand the Savannah Harbor and deepen the channel in order to allow the larger vessels that will soon be coming through the Panama Canal to dock in our state. We are very pleased that last fall we succeeded in getting a positive Record of Decision from the federal government. This is a major milestone on this project.               

My budget includes an additional $50 million in the bond package for this project. This will bring our total state contribution to $231 million. That is almost the state’s entire contemplated share of the costs of this project; the remainder of the cost is to be paid by the federal government. While that is a sizable amount of money we expect the benefits to be $5.50 for every dollar spent—Not a bad return on investment! 

I will conclude my remarks on a topic that does not require the recitation of statistics, but is one that is recognized in both the public and private domains as a cornerstone of success – that is ethics. We can build the strongest foundations of frugality, efficiency and competitiveness upon which our state government will rest; but if the citizens of Georgia don’t trust us, it will all be in vain, for the vibrations of distrust will crack even the strongest foundations. There will always be those in the media and elsewhere who thrive on sowing the seeds of doubt and distrust and who will never recant their sinister innuendos and malicious accusations even when they are vanquished by Truth.  And while you will never silence those voices of discord, nor should you try to do so, you can bolster the confidence of the public that might be tempted to listen to them by simply establishing clear rules under which you and those who deal with you in your capacity as elected officials must operate. If there is to be an expansion of the code of ethical conduct for members of the General Assembly, it should apply equally to all elected officials at the state and local levels.

We have laid our foundations for a strong and successful Georgia—public safety, education, healthcare, economic development and ethics. I look forward to working with each of you this session as we continue to grow Georgia in these most crucial areas.  And together, we will run a state rather than its citizens’ lives.

May God give you wisdom in your deliberations, and may he continue to bless this great state of Georgia.