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What should Georgia do with its $12 billion surplus? Experts: Spend it on education, Medicaid, tax credits and refunds
Georgia is sitting on nearly $12 billion of surplus, the most cash on hand in state history. Here’s what some fiscal and government experts suggest doing with some of the windfall:
Danny Kanso, director of legislative strategy and senior fiscal analyst at Georgia Budget & Policy Institute
The state [should] plan around recurring spending in public education. We’re one of a handful of states that don’t account for poverty in our education formula. We know that poverty has a huge effect on how students learn and their ability to be successful. So we recommend the state increase and add funding that responds to the level of poverty in each district and school across the state. We can help to front load that through some surplus funds. Then, preserve it over the long term using recurring revenues.
Medicaid is an area where now we're one of 11 [states] that hasn’t expanded Medicaid. More than half a million Georgians need access to health care and don't have a path to getting access to health care otherwise. That's one of the most important things we could do immediately. Those surplus funds could be part of that equation and should give us confidence that we can pay for it long term.
Use the surplus funds in an intentional way to manage the budget and ensure that we’re well-resourced enough to sustain those investments, rather than focusing on one-time uses.
The most important thing the state could do to give economic relief to Georgians is to adopt an Earned Income Tax Credit. Thirty other states have it at varying levels. The federal government has it. Second to Social Security at the national level, the earned income tax credit has been one of the most successful anti-poverty programs in modern American history.
Dr. Jeffrey Dorfman, fiscal economist for the state of Georgia
One thing that's very important, and the governor really insists on this, is it has to be a one-time thing. We can't take these extra monies and spend them on an annual recurring thing because then when the money's gone, now you're burdening the taxpayers and you're gonna have to raise taxes to keep paying for that. That's why we're looking at water and sewer systems and rural broadband and a lot of things like that where we can pay upfront costs with the money we have now. If we can do infrastructure investments and lower our ongoing expense structure. This is our ultimate goal.
Tony West, deputy state director for Americans for Prosperity Georgia
Keeping the rainy day fund fully-funded is a smart idea. Anything leftover could be used for more transformative tax reform. As much progress as we’ve made over the last six years on the tax code, there’s more room for improvement. If done right, it will lead to even more revenues down the road. That would be at the top of my list. Return some money to taxpayers. Pay down bond debt. Consider doing a one-time project, not a recurring one.
Eric Johnson, project director overseeing construction of the Hyundai EV Plant in Bryan County and former Senate president pro tem
I’d make sure the teachers’ pension fund has enough money to pay future retirees. Then, I’d look at what’s needed in education and health care [areas that have taken big budgetary cuts in recent years]. Lastly, make sure there’s enough money for disaster relief.
In Case You Missed It
Georgia’s purse holds billions and is closed tight, but should it be?
Teachers, Bridges, Tax Refunds: What Georgia’s $5 Billion Surplus Can Buy
Georgia’s Record $5B Budget Surplus Sets Up High Stakes Legislative Session
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Lawmakers explore ways to keep seniors from heading to nursing homes too soon
The Gist
The House Human Relations & Aging Committee explored several legislative and regulatory solutions to address the long-term care needs of Georgia’s rapidly expanding elderly population last week. A big focus was on how to best use Medicaid funds to provide more care for seniors who don’t yet need to be in a nursing home, and are trying to stay in their homes, assisted living facilities or personal care homes.
What’s Happening
Lawmakers, leaders of state health and welfare agencies and a variety of long-term senior care facilities and associations spent four hours discussing how to provide better care for the growing population of low- and middle-income Georgia seniors who have a range of medical, housing and social service needs.
Some need modest support that can be provided in their homes by relatives or other paid caregivers, while others, including people with dementia, need ready access to medical services and constant oversight, but not the more intensive, expensive and skilled care that’s provided in nursing homes.
Much of the discussion centered around HB 582, a bill introduced in the last legislative session by House Public Health Committee Chair Rep. Sharon Cooper, R-Marietta. It would allow assisted living communities, personal care homes and other providers of home- and community-based services to enroll as Medicaid providers and receive Medicaid funds, which is currently prohibited by state law.
Access to Medicaid funds would help Georgians who need these services, but can’t afford them, “to age in place without moving to a skilled nursing facility,” according to the bill.
Nursing homes are currently funded by state-managed Medicaid dollars, comprised of about two-thirds federal funds and one-third state funds. And some personal care homes that have up to 24 beds serving elderly people who are frail are also allowed to receive Medicaid funding in Georgia through waivers granted by the federal Centers for Medicare and Medicaid Services.
Meanwhile, some larger assisted living providers want much wider access to Medicaid funds to meet the ever-increasing demand for affordable housing and supportive care that aging residents need.
Among them is Wesley Woods Senior Living, which provides apartment homes and care to about 1,800 older adults in Georgia, ranging from seniors with extremely low incomes to the affluent. CEO Terry Barcroft told the aging committee that she has 172 beds categorized as assisted living or personal care homes, where staff provide daily living support services to residents.
Many of their units are occupied by seniors on fixed incomes who depend on subsidized housing assistance, she said, and can’t afford to pay for supportive services. Wesley Woods provides more than $1 million in charitable care to make sure such people can stay in their homes,” said Barcroft.
But there are many more seniors in Georgia who need assisted living care but who don’t qualify for Medicaid waivers. The passage of HB 582 would create more accessible options within long-term care programs for thousands of people “who don’t need 24-hour skilled nursing but do need 24-hour watchful, protective oversight,” Barcroft said.
Why It Matters
The state’s senior population is rapidly growing. Georgians aged 60 or older currently represent more than 15% of the total state population of 11 million, said Debra Stokes, executive director of the Georgia Council on Aging. Numbering 1.7 million in 2020, the senior population will expand by more than 500,000 people by 2030, when they’ll outnumber the under-20 population. By 2040, older Georgians will number 2.8 million, with the greatest rate of growth among those 80 and older.
Meanwhile, the number of Georgians age 65 or older living with Alzheimer’s disease and dementia is also expected to climb to 190,000 people in 2025 from 150,000 in 2020, a 27% increase, said Nancy Pitra, government relations director for the Alzheimer’s Association of Georgia. At the same time Georgia’s Medicaid costs to care for seniors with Alzheimer’s, $1.2 billion in 2020, are expected to increase 26% by 2025, she said.
People with moderate to severe dementia need constant oversight, Pitra noted, and allowing them to access Medicaid-funded services in assisted living facilities would mean living and receiving care in more affordable, less isolated, home-like environments.
This swelling of the aging population will elevate the demand for affordable housing that is already tough to come by in Georgia. It will also exacerbate the existing shortage of skilled nurses, nursing assistants, memory care providers and other caregivers that serve seniors.
Finding new ways to finance the cost of long-term care for seniors is crucial, said MaryLea Boatwright Quinn, assistant deputy commissioner of the Division of Aging Services in the Department of Human Services. She leads the agency’s home- and community-based services program for vulnerable adults, which has a budget of $114 million, and allocates state and federal funds to aging-related agencies in Georgia.
Home- and community-based services positively impact seniors’ health and reduce health care costs by reducing hospitalizations and getting people to be more compliant with disease management, said Quinn, a licensed medical social worker.
“We’re trying to help people … stay in their home of choice and avoid institutionalization as long as possible,” she said.
What’s Next
One of the newer models relying on Medicaid, and Medicare, to provide long-term, community-based care for seniors is PACE, or Programs of All-Inclusive Care for the Elderly, which provides, often at an adult day health center, comprehensive medical and wraparound services to medically frail elderly people through an interdisciplinary team of caregivers.
Most patients enrolled in PACE programs live at home. Costs for their care are capped at a flat per diem rate, instead of being paid per service, and providers are required to deliver all the medical, social, transportation, food, physical therapy, memory care and other services that seniors in the program require.
The FY 2024 state appropriations bill mandated that the Department of Community Health conduct a needs assessment on the establishment of one or more PACE programs.
Brian Dowd, deputy commissioner of the department, told lawmakers that his team has been studying some of the PACE programs operating in 32 states for several months, and determined that the model could be viable in several Georgia counties they looked at, including Fulton, Dekalb, Cobb, Bibb, Chatham, Richmond, Gwinnett and Muscogee.
Because “they’re essentially on the hook for everything” that patients need, Dowd said, providers are also incentivized to use case management and other efficiencies to keep costs down.
Adopting PACE wouldn’t rely on a Medicaid waiver, which typically lasts five years, he said. It would more likely involve amending the state Medicaid plan. Dowd said the Department of Community Health is examining the need for legislation to authorize PACE programs in Georgia, and also developing cost projections for the program.
Kathleen Benton, CEO of Savannah Hospice, told lawmakers that she had spent two years researching PACE programs, and hopes the state will fund a pilot program.
She estimated the per person cost of a PACE program in Georgia would be $4,700 per month. “That’s much different than the $6,100 spent on nursing homes right now,” she said, adding that with PACE, patients and providers are more satisfied, attrition for both groups is low, and the supportive family members of patients aren’t overwhelmed with trying to provide or coordinate all of their care.
“We’re in a perfect storm in Georgia,” she said. “Beyond the aging population, we have a labor shortage,” and no good solutions on the horizon to solve it, Benton said. “We must look for inherent caregivers in the home. We have to support them and provide them respite.”
Rep. John LaHood, R-Valdosta, who manages several assisted living and senior care centers in Georgia, told State Affairs he sees pros and cons in the PACE model.
“In one way it makes it more predictable for the state to put a price tag on one person and say, ‘Alright, they’ve been taken care of at this price, no matter what they need,’ ” he said. “I think my concern would be that a PACE provider might be incentivized to be so efficient, to mitigate the risks of overspending, that they might avoid necessary care and getting that person engaged with the necessary providers. We would need some accountability, some kind of backstop for that.”
While all lawmakers and others who spoke at the committee meeting agreed that providing more independent living situations, medical care and social supports for seniors is important to pursue, not everyone was sure that using Medicaid funding to do it would work.
Some were not clear if repealing the state prohibition on funding assisted living and large personal care homes with Medicaid monies is permitted by the federal Medicaid agency. Others pointed out that 45 states are already using Medicaid funds for assisted living and a variety of home- and community-based services, with no regulatory backlash.
Catie Ramp, CEO of the Georgia Senior Living Association, a nonprofit trade association representing private pay senior living facilities, said her association is concerned about the potential negative consequences of allowing more Medicaid spending in the senior living market.
She said Medicaid’s low reimbursement rates might lead providers to “minimize quality of care and care options” in order to avoid passing on costs to residents. Otherwise, their labor costs will rise significantly, she said.
Barcroft said that labor shortages since the pandemic have led Wesley Woods to raise its base pay to $15 an hour, costs which “can only be passed on to residents and their families,” she said, adding that she hoped the state would continue to promote medical career pathways “to help students understand what CNAs [certified nursing assistants] and med techs do,” and draw more people into the field.
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Header photo: A nurse assists a resident at Fellowship Home at Brookside, an assisted living center in Valdosta. (Credit: The Fellowship Family)
A conversation with GBI Director Chris Hosey
If anyone knows the inner workings of Georgia’s top law enforcement agency, it’s Chris Hosey.
In his 36 years with the Georgia Bureau of Investigation, the Georgia native has worked under five GBI directors and held every sworn supervisor rank in the bureau’s investigative division.
On Aug. 1, he assumed the helm of the 86-year-old bureau, succeeding Michael Register who returned to Cobb County where he is public safety director. Hosey is the third director of the bureau in the last four years. Register’s predecessor, Vic Reynolds, was appointed by the governor to be Superior Court judge in Cobb County.
Hosey takes on a bureau with a staff of about 850 and a budget that topped $147 million in FY 2023. The bureau has investigated 65 officer-involved shootings since January, according to its latest monthly statistical report released this month.
State Affairs spoke with Hosey about his nearly four-decade tenure with the bureau, his plans for moving the agency forward, the case of the headless goats, and Will Trent, television’s quirky, fictional GBI special agent.
The conversation has been edited for clarity and length.
Q. What inspired you to go into law enforcement?
A. While I was in college, I had the opportunity to meet GBI agents and learn about the agency a little bit. I liked the professionalism that I saw in the agents that I met. I liked the fact that it was a statewide agency. And I had the ability to travel throughout the state to investigate crime and that sort of thing.
I don’t mean this to sound bad but violent crime interested me. Just the ability to investigate and solve a complex situation intrigued me.
Q. You’re a career GBI employee. What unique attributes do you bring to the bureau?
A. Knowledge of the agency. There was still a learning curve obviously going into the director position. But I think I brought a lot of knowledge of the agency and the operations of the agency from just being around it for 36 years. I’ve served in literally every capacity the GBI has, beginning in the investigative division and then as deputy director over investigations. DirectorRegister made me assistant director last year. So I got a lot of exposure to what the director does, prior to his leaving.
Q. You’ve been with the GBI a long time, what do you love about the job?
A. I enjoy the work. I enjoy the people. I enjoy the partnerships in working with our state partners, our sheriff’s office, our local partners in our sheriff’s office and police departments. I’m just big on relationships like that because I don’t believe one agency can do the job by itself. It takes everybody working together with a common goal in mind, set egos aside and work together and get the job done.
When you find yourself a part of a great team, that makes you not want to leave. It makes you want to stay. It makes you want to see that team develop. It makes you want to see new players come, watch them grow and be successful as well.
Q. The GBI has had three directors in the last four years? Has that created disruption within the organization and its goals?
A. As I’ve said before, the success of this agency doesn’t depend on who’s sitting in the director’s chair. It’s dependent upon the men and women that are out there doing the job everyday. The director provides guidance, oversight, sets goals, whatever. Every one of the directors I’ve worked for were … very, very good leaders. Very good vision for the agency. They did great jobs.
Q. How does your leadership style differ from your predecessor?
A. I don’t know that there’s a lot of difference. One thing that I recognized when he came was, in a lot of ways, we were a lot alike in our leadership styles. We believe there’s a mission out there. We set our goals and we give our people within the agency the ability to do their job, and we support them in that. He taught me a great deal in the time that he was here. He exposed me to a lot.
I think one thing important about leadership is … once you get in a leadership position, it is not about you anymore, it’s about taking care of your people.
Q. What are the biggest challenges facing the bureau?
A. We have to make sure that we’re staying current with the times. The world is changing around us as a law enforcement agency; we’ve got to change with it. That involves technology, additional resources, equipment, personnel, whatever the case may be. We’ve got to be forward thinkers. We’ve got to be dealing with a day in front of us, but we’ve also got to be looking down the road trying to predict what could change next that we can be ready for and prepared for and not trying to catch up.
There’s a lot that doesn’t change in investigations. There’s the traditional investigation, talking to people, collecting evidence, whether it be physical or testimonial evidence. I believe we should always be at the top tier of doing that. But with today’s times, with the technologies out there for something as simple as cell phones we’ve got to be able to ensure that we are utilizing current technology that can assist us and complement the traditional investigative tasks that we have done for years.
Q. What will be your top priority going forward?
A. We’ve got to continue to address violent crime and gang activity across the state. We’re continuing to look at ways we can advance in that. But again, that’s an area GBI will not fix by itself. We rely heavily on those partnerships around the state as we do in every investigation that we work.
My focus is on the agency and providing the resources, manpower, and the leadership that it needs. We’re an agency that has always adapted regardless of all of the instances that have come up. We have always found a way to adapt and get the job done.
Q. What budget and policy requests will you make for the upcoming amended FY 2024 and FY 2025 budget?
A. We’re still working through that right now. We’ve not finalized anything, budget wise. I’m looking at what our needs are coming from the division directors and how that can best support the agency over the next year or the following year.
Q. Are you expecting any policy or legislative changes with regard to the GBI during the 2024 session?
A. No, hopefully. Not to my knowledge.
Q. Senate Bill 11, which enables the GBI to investigate all acts of terrorism, passed during the last session. This bill opens the door for the GBIto pursue alleged crimes that local law enforcement agencies have deemed not worth their time. Are there some cases you’d like the GBI to pursue?
A. Not that I can think of right now. We take them as they come. If they’re worthy of an investigation, then we’re going to pursue that.
Q. SB 44, which is intended to limit gang activity, appears to have some unintended consequences. Apparently, critics believe more people could face prison sentences if they miss a court date or, for example, if they get stopped for something like a broken tail light. Thoughts?
A. In general, I think we have very good gang laws in this state. It’s not hard to work across the state and realize that there are concerns when it comes to gang activity. There’s a nexus between human trafficking and gang activity at times; it just depends on where in the state you want to look. The fact that we’re seeing evidence of gangs attempting to recruit 11 year olds, 12 year olds is very uncomfortable to see and hear about. I believe we have good gang laws. I believe we’re pursuing it in the right way. And at the end of the day it’s to make Georgia safer.
Q. Have you personally sat down with gang members or alleged gang members?
A. Years back I have.
Q. Would you consider doing that again going forward?
A. Yeah, absolutely.
Q. The GBI is investigating a case involving headless goats that have been dumped in the Chattahoochee River over a number of years now. Has any progress or arrests been made in that case?
A. I’d have to go back and check on that. I’m not really familiar with the incidents.
Q. Georgia’s ban on abortion after six weeks, or the first detection of a heartbeat, took effect last year. Have you had a case where an individual had violated Georgia’s abortion law? If so, did you arrest that person?
A. I’m not familiar with any. But just like any other law that is set forth for us to enforce, if we had the need to investigate one, we will. I’m not familiar with any we’re working on right now.
Q. Aside from becoming head of the bureau, what’s your biggest accomplishment at the GBI?
A. Probably them allowing me to stay here 36 years.
Q. What’s your biggest disappointment?
A. I don’t know that I’ve had a big disappointment. There’s things that have come up through 36 years that bothered me. But you know, I live under the adage that this too shall pass.
Q. Have you seen the [ABC Friday night television show] Will Trent. It’s about a GBI special agent. Do you have a Will Trent on staff and more importantly do you recognize the TV version of the GBI?
A. I watched it the first night [it came on] and I wasn’t real sure. Then I continued to watch it. It’s entertainment. I mean, it’s Hollywood. You know, Will Trent is depicted as an excellent investigator and from that standpoint I got 300-something of him. I enjoy watching it.
I actually went to an out-of-state conference in the spring of this year. When they handed me my name tag, my name was on one side and [the name] Will Trent was on the other side. They knew I was from Georgia and that show was out. I was getting ragged about that a little bit.
Want to get a glimpse of what the GBI does? Take a look at its monthly statistical reports here.
The Christopher E. Hosey Files
Title: Director of the Georgia Bureau of Investigation
Age: 59
Hometown: Newnan
Current residence: Thomaston
Education: Bachelor of Science in Sociology from Georgia Southwestern State University and a Masters in Public Administration from Columbus State University. He is a graduate of the FBI National Academy, Class 247.
Career path: Narcotics agent, local violators squad, 1987-89; special agent, Region 5 in Statesboro, 1989-90; special agent, Region 2, Thomaston/Greenville, 1990-2001; assistant special agent in charge, Region 2, Greenville, 2001-05; assistant special agent in charge, West Georgia Drug Task Force/West Metro RDEO, 2005-08; special agent in charge, Region 5, Statesboro, 2008-09; special agent in charge, Savannah RDEO, 2009-12; inspector, headquarters, investigative division, 2012-20; deputy director of investigations, HQ, investigative division, 2020-22; GBI assistant director, 2022-23.
Family: Married 34 years to Powell; two daughters.
Hobbies: “I go to the gym. I’ve been doing that for years. I enjoy golf. Working in the yard. I like woodworking. I just haven’t had time to do much of that here lately.”
If you weren’t in the field of law what would you be doing? “The first thing that popped in my mind was probably something in the medical field. I went to school for EMS [Emergency Medical Services]. The GBI actually sent me to school for that for our tactical team. Once I completed it, I actually went to work part-time with an ambulance service at home. And I did that up till last year. Then things just got so busy. I didn’t have time to do it anymore but I enjoyed it. I still have the uniforms. I still intend on going back and doing it some more when I can, when things settle in.”
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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)