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‘Gas Is Ridiculous’: Georgians Weather Inflation with Few State Solutions
Key Points
- Gas prices have soared 35% – from $2.90 to $4.49 a gallon for regular fuel – over the past year.
- Grocery prices for items like milk – 25% higher – and eggs – 43% higher -- have also spiked.
- Will Federal Reserve interest rate hikes bring relief to Georgians struggling amid inflation?
The Gist
From Atlanta to Savannah, inflation is pummeling people in Georgia. Costs have doubled recently to buy groceries or fill up the gas tank, leaving many Georgians asking what their elected leaders can do to help ease the financial pain.
What’s Happening
The perfect storm of global supply chain disruptions, heavy public spending on the Covid-19 pandemic, and oil uncertainty from the Russia-Ukraine war have shot up prices from milk and chicken to gasoline and used cars across the U.S., including Georgia.
“When the not-so-organic section is the same price or higher as the organic section, we have a major red flag here,” said Ashley Bruce, an Atlanta metro bartender with four young kids. She’s seen prices double for her home’s staples like mangos, broccoli and milk in recent months. “And the meat section?” she added. “Forget about it.”
Prices for gas and groceries like milk, bread, meat and eggs have shot up in Georgia and across the U.S. over the past year. (Credit: Brittney Phan for State Affairs)
On Wednesday, the Federal Reserve hiked interest rates higher than it has in nearly three decades, aiming to wrangle inflation levels that have caused rent, groceries and gas prices to soar faster in the Atlanta area than any other urban zone in the country, except Phoenix. As of April, prices overall in the Atlanta area were nearly 11% higher than they were a year ago.
But don’t expect a break on stiff gas and food bills anytime soon, local economists say. Inflation will likely continue taking its toll on Georgians struggling to stretch their dollars at the pump and grocery shelves for at least another year or more. And there’s little Georgia government officials can do about it.
“I think we’ve exhausted the state-level options,” said Gopinath Munisamy, head of the Department of Agricultural and Applied Economics at the University of Georgia. “In my view, the federal government has more tools than the state government on this issue.”
Grocery Stores
Kelsey Tyree, a software company owner in the Savannah area, said she’s resorted to “small-time couponing” as a tactic to cover her family’s groceries. She hops from Kroger to Publix to Dollar General, hunting for deals.
“If Dollar General has a coupon sale for detergent, that’s where I’ll get my detergent,” said Tyree. Her grocery runs have spiked from $200 every other week last September, to $300 when her newborn son arrived in January. Now, she’s shelling out $400. “It’s a whole day trip just going to different stores.”
Prices have been punishing for grocery stores in Georgia and beyond. In Atlanta, a gallon of milk has jumped 25% to $4.29 last month from $3.26 in May 2021, according to the U.S. Department of Agriculture (USDA). Eggs across the South have risen a staggering 43% to $2.60 from $1.49 over the past year.
Some foods have also gotten scarce outside Atlanta. Shavokia Bryant, a nurse who runs the Atlanta-based John-Trell Foundation, travels between Atlanta, Macon and Albany giving food to the homeless. Even though it’s more expensive, she buys whole chickens in bulk in Atlanta, makes hot meals out of them, and brings them to homeless people in Macon and Albany where bulk chicken is harder to come by.
“Nine times out of 10, Albany doesn’t have chicken cases,” Bryant said. “We’ve been blessed with the means to afford things and still move forward with our mission. But for people who cannot afford it, I feel bad for them.”
Shavokia Bryant prepares and gives food to the homeless in the Atlanta, Albany and Macon areas through the John-Trell Foundation. (Credit: Shavokia Bryant)
Residents throughout the state are wondering what more, if anything, the state can do to help?
Gov. Brian Kemp used executive powers in April to reduce limits on how much weight commercial truckers can carry and the hours they can drive – a move aimed at clearing up backlogs on trucking routes to hasten food and other goods to local stores.
Several economists interviewed by State Affairs, however, suggested the governor could temporarily suspend some amount of local sales taxes to give grocery shoppers some price relief. Charles Bullock, a University of Georgia political science professor, said a Georgia governor has not suspended sales taxes in the last 50 years. Kemp’s office did not immediately respond when asked if the governor is considering a sales-tax suspension.
Outside tax breaks, the state Department of Agriculture has not asked the USDA to relax rules on food production or distribution requirements that might help lower food costs, said agency spokesman Bo Warren. The agriculture department has recently started work on a new program to send Georgia-grown farm products directly to local food banks.
That program should help boost donations to local food pantries, churches and other groups that have seen huge demand amid the Covid-19 pandemic and high inflation, said Jon West, a vice president with the nonprofit Atlanta Community Food Bank. Atlanta-area food pantries serve around 500,000 each month, he said – up from around 300,000 before the pandemic. And those that are served are from the poor to the middle class.
“Inevitably, as food costs go up, those donations are harder to get,” West said. “Hopefully some folks step up and fill that gap, but that just doesn’t always happen.”
The U.S. House of Representatives on Thursday passed the “Lower Food and Fuel Costs Act” that would send farmers $750 million to buy equipment that would help them reduce fertilizer and fuel costs. All six of Georgia’s Democratic congress members voted in favor of the bill. All eight Republican members voted against the bill.
Gas Stations
Gas is so expensive now that Karina Figueroa, a stay-at-home mom in Dahlonega, doesn’t visit her mother in metro Atlanta twice a week anymore. It takes $50 to fill the tank in her husband’s car – and he needs every bit of it for traveling to Cobb County for his job as a construction worker, a commute that takes more than an hour each way to complete.
“There’s no point in me taking a joy ride to visit my mom when he has to use gas to [get to] work,” Figueroa said. “Gas is ridiculous.”
The graph shows the rise in the consumer price index for the metro Atlanta area from April 2019 to April 2022. (Credit: U.S. Bureau of Labor Statistics)
While Georgia’s gas prices are hovering below the $5 national average at $4.49 for regular-grade fuel, they’re still significantly higher than the $2.90 for regular fuel a year ago, according to AAA’s gas-price survey.
Tyree, the software-company president in Savannah, has used her couponing method to rack up gas discounts at stations run by Kroger, which lets customers shave off costs from pumping gas whenever they shop for groceries. Still, gas has leapt from $30 to fill up Tyree’s Subaru to now “pushing $60.”
Bruce, the Atlanta bartender, also takes advantage of the Kroger deal. She tries to fill up near her suburban home in Stockbridge, where she said gas is about 30-cents cheaper than in Atlanta. But her commutes around Atlanta, where public transit isn’t easy enough to reach where she needs to go, still pack a punch to her wallet.
“What are you going to do?” Bruce said. “You’re not going to fill your tank up? You have to pay the prices.”
Ashley Bruce is one of many Georgians juggling finances to cope with high gas and grocery prices amid inflation. (Credit: Ashley Bruce)
Amid global shipping snarls and oil disruptions in Russia, local economists say there’s little else Georgia officials can do to lower gas prices besides suspending the sales tax on gasoline, which Kemp did last month. Suspending the gas tax hacks off around 30-cents per gallon for Georgia drivers. The current suspension order is set to last until mid-July.
Electricity & Air Conditioning
With auto gas and food prices rocketing across Georgia, residents have largely been spared similar cost increases on their monthly energy bills. Georgia Power, which serves most of the state’s homes and businesses, needs approval from the state Public Service Commission (PSC) before recovering higher fuel costs with customer charges. The utility hasn’t sought that approval yet, said commission spokesman Tom Krause.
Overall, Georgia homes and businesses consuming an average 1,000 kilowatt-hours per month – roughly the national average for a typical American home – hasn’t changed much since last year, hovering around $125 between winter 2021 and winter 2022, according to PSC data.
Georgia Power has not yet asked state regulators for approval to hike customer charges to cover higher fuel costs amid inflation. (Credit: Wikimedia Commons)
Local energy providers that do not require PSC approval to change billing rates have hiked costs over the last year. Average monthly bills shot up $10 or more for some municipal and electric cooperative customers in North Georgia’s Blue Ridge, south of Atlanta in College Park, and in South Georgia’s Irwin County.
Despite reassurances from state regulators, some Georgians still wonder how much inflation is creeping into their monthly energy bills. Tyree says her bill’s gone up about $50 since summer started – from around $150 to $200. But that could just as easily be blamed on running the air conditioning more often with a newborn in the house, she acknowledged.
“It’s kind of hard to say just because Savannah’s terrible this time of year,” Tyree said. “Everybody’s electric bill is really high.”
What’s Next?
Economists are closely watching how the Federal Reserve’s interest rate hike on Wednesday will affect demand and borrowing. They expect the central bank to bump in interest rates again by September, unless inflation cools off significantly over the next month.
In the meantime, local economists tell State Affairs that Georgians should strap in for high gas and grocery prices for at least another year. Tibor Besedes, a Georgia Institute of Technology economics professor, said that means Georgians on tight budgets will need to clamp down on their personal spending.
“The best that consumers can do is try to adjust their consumption patterns,” Besedes said. “Shop for deals, perhaps shop in cheaper stores, and driving-wise, perhaps combine or condense trips.”
Alessandro Marazzi Sassoon contributed to this story.
Resources
- Georgia Food Pantries: Find your local food pantry
- Apply for SNAP benefits: Online portal
- Georgia Attorney General’s Office: Report price gouging
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Latest Stories
Putting long lines in the rearview: driver services continues technology update
The Gist
The days of standing in long lines to get or renew a driver’s license may soon be in the rearview mirror for good.
Over the next month, Georgia drivers will continue to see significant updates in services as the Georgia Department of Driver Services continues its push to modernize through state-of-the-art technology and to cut back on long wait times caused by a shortage of workers and backlogs due to Covid-19.
What’s Happening
The department will roll out about 20 kiosks in its metro Atlanta offices where motorists can get or renew driver’s licenses, replace lost or stolen ones and record address changes. The rollout is a pilot program and will be extended to the rest of the state later, department spokesperson Susan Sports told State Affairs.
At the same time, the kiosks you use at Kroger and Publix to renew your car tags “are being updated and modified to add the driver’s license [renewal services] to them,” Sports said. Initially, those kiosks will renew licenses and ID cards. More services will be added later. The grocery store kiosks are run by the state Department of Revenue.
Driver services has also taken steps to make traveling easier for Georgians.
The department now allows Georgians to add their driver’s license or state ID to Apple Wallet on iPhone and Apple Watch, making check-in at airports quick, easy and secure. It is not intended as a replacement for a physical copy of your license or ID but it can speed up the process at TSA checkpoints. Android users will soon have a similar option, Sports said. Georgians meanwhile also have the option of renewing their driver’s license online.
Despite the online presence, some people still prefer to come into the office, Sports said. Now, they’ll have the option of using a self-serve kiosk rather than having to stand in a long line.
Why It Matters
The state is spending close to $2 million to add the kiosks and update services for Georgia drivers, an initiative driven by fewer department staff and greater demand for quicker services.
“The kiosks especially should help with the agency’s workforce issues,” DDS Commissioner Spencer R. Moore said. “If you have a self-service kiosk that is handling that renewal customer coming in, not having to take a break or a lunch or take vacation, it’s going to really offset some of those staffing challenges that we have.”
The new technology isn’t just for giving short-handed staff some help. It also is intended to head off a potential rise in wait times once a round of license expirations kicks in over the next two years, Sports said.
“Having a self-service kiosk option will save wait time for customers,” she said. “In turn, the driver examiners will be able to assist those customers that cannot be served in any way but in person. It will save customers time because if they use the kiosk, they do not have to fill out the required ‘application for service’ or take a ticket number for service as is required for all customers visiting in person.”
While as many as 45 Department of Motor Vehicle agencies in the United States were using some type of self-service kiosks in 2021, there is still a large number of government agencies that have not yet taken advantage of the technology, according to Kiosk Marketplace.
What’s Next?
Meanwhile in Georgia, the Department of Driver Services’ kiosks are currently wrapping up the test phase, Sports said, and should be rolling out over the next 30 days at the 65 DDS offices statewide and in grocery stores.
“That’s the wave of the future and our customers are on the go. They want more options,” said Sports. “In the old days, you’d go to the DDS and you would take a lounge chair and you’d take a book and you knew you were going to be there all day. So now … our service goal statewide is less than 30 minutes.”
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Header image: City of Warner Robins former Police Chief John Wagner poses with a Georgia driver’s license. (Credit: Georgia Department of Drivers Services)
Lawmakers plan another run at rent control legislation
The Gist
ATLANTA — Skyrocketing rents and punitive fees by homeowners associations that place some Georgia residents at risk of losing their homes are among the targets of several housing-related bills that Sen. Donzella James, D-Atlanta, and other members of the Georgia Legislative Black Caucus hope to revive in the next legislative session. Four such housing bills stalled in the Senate this year.
What’s Happening
The Senate Urban Affairs Committee met Wednesday to discuss the proposed legislation designed to protect renters from sharply escalating rent prices, and what some senators and presenters described as unfair fees, eviction and foreclosure processes imposed by property owners and private associations that manage homes, apartments and condominiums.
James, the committee chair, is the sponsor of SB 125, which would repeal state law enacted in the 1980s that prevents local governments from regulating rent. Georgia is among 30 states in the U.S. that prohibit rent control by municipalities or counties, and among several states now considering repealing such laws.
“We’re attempting to lift that ban so cities and counties … can work with residents to stop rental leases and bills that are doubling and tripling and causing foreclosures and evictions,” said James. She noted that as the cost of living increases, “we’re seeing more families struggling to pay rent in metro and rural areas, and consequently many of those people can’t afford it anymore and have become homeless, or are staying in day hotels when they can afford to do that.”
Two other housing-related bills were also on the agenda. SB 29 would limit the ways homeowners, condo and property associations can penalize people for nonpayment of fees, and requires them to seek arbitration before placing liens on a property. And Senate Resolution 37 would create a study committee to let lawmakers take a comprehensive look at the policies and practices of such property associations.
Why It Matters
Rents have increased sharply in Georgia in recent years. According to the U.S. Department of Housing and Urban Development, fair market rents — the monthly cost of rent for standard-quality units in a local housing market — increased by an average of 24% from 2019 to 2023 in the U.S. In Georgia, fair market rents increased by 33% over that time. A one-bedroom apartment in Georgia now averages $1,115, and a two-bedroom is $1,283.
Rental costs are considerably higher in some Georgia cities, especially those where out-of-state private equity firms have purchased large numbers of residential properties and jacked up rents. In Atlanta, the fair market rent for a one-bedroom is now $1,375 and a two-bedroom is $1,553.
Some apartments cost much more. Nothing in Georgia law limits how much a landlord can raise the rent.
The Urban Affairs committee heard from several tenants whose rents have increased precipitously. Among them was Gladys Dancy, 83, who lives at Galleria Manor Senior Apartments, an affordable housing complex in Smyrna. She said when she moved in 10 years ago, the rent for her two-bedroom apartment was $780, and has since climbed to $908. In July, she received a notice from the building’s owners that her rent will rise to $1,215 in October, a 39% increase.
“They’re pushing me out,” said Dancy, adding that her only income is from Social Security. Dancy has a leg impairment that requires her to use a walker.
Noting that she lives two blocks from Truist Park, the Atlanta Braves stadium, which was an undeveloped wooded area when she moved in, she said, “All the rents around here have gone way up, and now they say they’re switching from an affordable property to market price. Is that legal?”
Other people testified about negative experiences with homeowners associations.
One man said he was fined $4,000 by his HOA for cars parked on the street near his home, even though he doesn’t own a vehicle. His neighbor said the HOA doled out $1,600 fines for covenant violations such as lack of shutters on windows and has placed $10,000 liens on multiple tenants’ homes.
David Washington, a real estate broker, said he specializes in helping people faced with foreclosure to stay in their homes. He said he recently worked with a 91-year-old client whose property was foreclosed on for delinquent HOA dues and related late fees, even though the woman had never missed a mortgage payment.
“Georgia is a creditor-friendly state,” said Washington. The state’s legal code related to rent “is not designed for if life happens,” he said. Even if over a 30-year period a homeowner has a sterling payment history, an HOA does not take costly life events into account the way that some loan companies do, offering forbearance, he noted. “Whether it’s COVID, a car accident, a divorce, a death — if you owe $5,000 to an HOA, they will foreclose on you,” he said. “And the law allows it.”
James noted that small liens issued by HOAs or banks can quickly lead to foreclosure, if not paid or legally resolved within a few months.
“Once you get $2,000 worth of liens, that house can go up on the courthouse steps and be sold from under you,” she said.
Rep. Billy Mitchell, D-Stone Mountain, the House Democratic Caucus chair, told committee members that the “draconian” Georgia law that permits HOAs to foreclose on a property because of overdue HOA fees is “bad legislation and I think we should join the overwhelming majority of states which do not allow that.”
Preventing and reducing evictions is another legislative focus of the committee.
Mableton resident Alonzo Williams told the committee that he and his disabled mother were evicted from their apartment after the landlord doubled the rent during the pandemic. He said he works in education and his mother has a fixed income. “We struggled mightily to pay it, but we couldn’t,” he said, adding that they are now living in temporary housing, and so far unable to find a rental unit they can afford.
Elizabeth Appley, an attorney and fair housing advocate, said that as of April, 14% of Georgians were behind on rent, according to the National Equity Atlas, a data site run by PolicyLink, a research and advocacy firm. Those Georgians owing rent included 181,000 households, 72% of which were low-income families. More than half were households with children.
The average rent debt in Georgia is $1,400, said Appley, noting that that amount is considerably less than the cost of eviction to local communities in the state, which averages $11,200 per eviction, according to a University of Arizona law school analysis. That eviction tally takes into account the cost of emergency shelter, medical, welfare and juvenile delinquency costs.
Legislation to give local communities more control over rental costs, as well as to provide more tenant protections statewide is needed, Appley said.
Besides the rent control and property association-related bills, she encouraged the Senate committee to support HB 404, the Safe at Home Act, which would put a two-month cap on rental security deposits and require landlords to give tenants at least three days’ notice and the opportunity to pay overdue rent and fees before eviction proceedings can start. The bill unanimously passed the House but was not called for a vote in the Senate last session.
“While the idea of rent control may appear an attractive solution to the affordable housing crisis, it is critical to understand its counterproductive and damaging consequences,” said Stephen Davis, government affairs director for the Atlanta Apartment Association.
National research shows that rent control policies reduce housing supply, lower property values and disincentivizes new construction of apartments, he said.
Davis pointed to a 2021 St. Paul, Minnesota, rent control bill that capped annual rent increases to 3% and led, he said, to an 80% drop in building permits for multifamily housing. Overall, new housing starts in St. Paul decreased by 30% over the next year, resulting in an amendment of the law in 2022 that allows some landlords to make larger rent increases.
Adding additional housing units to a market is the best way to address housing costs in communities with climbing rents, Davis said.
“The key is to increase housing inventory,” he said. “But most local governments are installing additional regulations and burdens on development. They’ve raised millage rates and impact fees. … Every condition put on a new development has a cost,” which is often passed on to the renter, he said.
What’s Next
SB 125, the rent control bill, did not move in the State and Local Governmental Operations committee last session. Sen. Frank Ginn, R-Danielsville, who chairs the committee, told State Affairs he does not support state regulation of local rent policies.
“I think that should be between the owner of the property and the renter,” Ginn said. “I don’t think the government should interfere in that process. There are other things that we can do to help local governments to lower the cost of housing, and to address things that drive the cost of housing up.”
James said she and other legislators are inclined to consolidate and amend several housing-related bills still alive in both chambers. She told State Affairs that requiring mediation before evictions and foreclosures can occur and appointing a state ombudsman to give people involved in housing disputes “a place to take their complaints before they lose their homes” are two key elements that should be included in housing legislation to be pursued in 2024.
James said the Urban Affairs Committee plans to meet at least once more prior to the start of the next legislative session in January.
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Header photo: Smyrna resident Gladys Dancy, 83, told the Senate Urban Affairs Committee members that her landlord plans to raise her rent by 39% in October. (Credit: Jill Jordan Sieder)
New Georgia law mandates active shooter drills in public schools
THE GIST ATLANTA — Georgia K-12 public schools have been conducting informal active shooter drills for years, just like they have for fire, tornadoes and other emergencies. But earlier this year, state lawmakers made the safety precaution against active shooters and other intruders mandatory. Gov. Brian Kemp signed The Safe Schools Act into law in …
Gov. Kemp suspends fuel taxes
ATLANTA — Gov. Brian Kemp suspended the state’s tax on gas and diesel fuel today, declaring “a state of emergency due to the 40-year-high inflation and negative economic conditions felt by hardworking Georgians as a result of policies coming out of Washington, D.C.”
The governor’s executive order goes into effect Wednesday and will remain in effect until Oct. 12. Kemp can only suspend the tax one month at a time as part of the executive order.
Kemp said President Joe Biden’s economic policies made the executive order necessary.
“From runaway federal spending to policies that hamstring domestic energy production, all Bidenomics has done is take more money out of the pockets of the middle class,” Kemp said. “While high prices continue to hit family budgets, hardworking Georgians deserve real relief and that’s why I signed an executive order today to deliver it directly to them at the pump.”
Kemp cited analysis from Moody’s Analytics from August that said U.S. consumers are spending $709 more per month than two years ago and $202 more each month than last year to buy the same goods and services.
Georgians will save 31.2 cents on a gallon of gasoline and 35 cents on diesel fuel, he said, adding that Georgians saved roughly $1.7 billion at the pump when fuel taxes were suspended from March to December last year.
House Speaker Jon Burns, R-Newington, supported Kemp’s order and also framed it in a political context.
“I applaud Governor Kemp’s suspension of motor fuel taxes to keep our people and our economy moving despite Washington’s inaction on rising fuel prices,” said Burns. “Georgia’s success story is no accident — it is the result of conservative policies enacted to keep Georgia the nation’s best state for business.”
According to AAA, the average cost of a gallon of regular gas in Georgia on Tuesday was $3.57, up from $3.24 a year ago. Diesel fuel was $4.35 a gallon, down from $4.69 a year ago.
Overall, inflation has been ebbing in the U.S. over the past year. A report from the Federal Reserve in August noted that while the consumer price index (CPI) in July was up 3.3% from a year earlier, that level is far below the peak rate of 8.9% in the 12 months that ended in June 2022.
Energy prices in the South have decreased 12.8% from July 2022 to July 2023, largely due to a 20% drop in the cost of gasoline, while food prices rose 5.1%.
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Header photo: Gov. Kemp’s executive order to suspend fuel taxes will save Georgians 31 cents on a gallon of regular gasoline and 35 cents on diesel fuel through mid-October. (Credit: Jill Jordan Sieder).