No. 2, Jan. 20, 2004

Governor Recommends 2 Percent Raises for Teachers, Promises HOPE's Survival

FY '05 Budget Includes $123M in Formula Funding

Gov. Sonny Perdue delivered his State of the State address and recommendations for the Fiscal Year 2005 Budget before a joint session of the General Assembly on Jan. 14. The following are excerpts from his remarks:

We've had some tough times recently. And many of us are still enduring tough times. ... We have big challenges before us, but I have no doubt that, together, we Georgians are more than a match for the challenges we face.

So I am proud to report to you all tonight that our foundation is solid and the state of our state is strong and getting stronger!

I have another important duty tonight. I am here to fulfill my obligation as Governor to recommend to the General Assembly a state budget for next year. This evening, I'm submitting a budget that is responsible, balanced and principled. It does not contain nor will I allow any new taxes.

... I have based next year's revenue estimate of $15.3 billion on a conservative projection of 4.72% growth in revenue. I believe this is a prudent and a responsible target.

... Here is the reality. When the auditors closed the books last year, our revenues were still below the level of when we closed them in 2000. That's why I directed every state department to reduce their budget requests by 5% for the coming year, so we can live within our means.

... This past summer, I directed every state agency to identify its core mission and its customers, put a price tag on every program it administers, and rank those programs in priority order. Prioritizing our programs will help us decide our budget the same way responsible families do. It's amazing to me that this had never been done before in the history of our state.

By identifying our priorities up front, we're able to focus spending on what we must have now, deferring what we can do without until better times.

... I will not allow anyone to make your struggle harder by reaching deeper into your pocket with a tax increase. If you have to live within your means, state government will too. We will not raise taxes to balance this budget.

Regarding education.

... Along with active, engaged parents, one of the best things we can do for education is to attract and keep the best teachers in our classrooms. To help do that, my budget includes a 2% pay raise for teachers. And for veteran teachers there will be an additional increase. In total, my plan will give a 5% pay increase to nearly 75% of teachers statewide.

I don't know if you've been in a classroom lately, but I think they deserve it! ... GeorgiaLearns.com is the name of my education package. GeorgiaLearns.com will inspire and empower students, parents, teachers and all educators to meet higher standards of accountability and achievement.

Regarding the HOPE Scholarship Program:

... There has been a lot of hand-wringing about HOPE. So let me make one thing clear ...The HOPE scholarship isn't going anywhere. It will be there for your kids and your grandkids and beyond.

The bipartisan HOPE Study Commission brought forth some good recommendations to secure HOPE for the future. I applaud and support their work.

The HOPE scholarship is and always has been about rewarding academic scholarship. That is why the "O" and the "P" in HOPE stand for "outstanding pupils." With that in mind, I have another idea that won't deny HOPE to one single B student, but will raise SAT scores. We should include an SAT component to HOPE eligibility.

Georgia must improve its SAT scores. I am not satisfied with 50th place and I am determined to get Georgia's SAT scores out of the basement, whatever it takes. I believe that linking the SAT to HOPE will motivate students to take the test seriously and will lead to better preparation for college and higher SAT scores. We will give an incentive to students who achieve on the SAT by extending their HOPE eligibility as a reward.

Regarding job creation:

Our state may not have a lot of cash right now. But we do have an excellent credit rating. And interest rates are low.

... We will invest in the state's workforce with $176 million for school construction and improvements and $47 million for expansion, improvements and equipment for our technical colleges statewide. And we will look over the horizon to make critical investments in the growth industries of the future that will create the jobs of the future.

Computers and information technology reshaped the 20th century economy. In the 21st century, the most dramatic changes will be in the life sciences and nanotechnology. And I want Georgia to be in the driver's seat. That means building the laboratories that will attract top researchers. Their breakthroughs will lead to new products, new companies, and high-paying new jobs.

My Georgia Works bond package includes $10 million for a state-of-the-art biological research building at the University of Georgia. It provides $5 million for the Medical College of Georgia Research Initiative that will launch new medical research projects and attract more federal research dollars. And we're putting $2 million toward a $45 million state commitment to construct a world class Nanotechnology Research Center at Georgia Tech.

Nanotechnology - the engineering and building of products at the atomic level - is projected to be a $1 trillion industry within twelve years. I want Georgia to be a world leader in creating this new industry.

In conclusion:

... Members of the General Assembly, my friends, I've listened to the people. I asked, and they told me what they want. They've told me they'll be watching. And they've told me they'll be holding us accountable for our results.

... I believe we will make the right decisions, and I believe we will secure Georgia's future. Because I believe Georgia's best days are still ahead.

Highlights of FY '05 Recommendations for the USG:

• $122.7 million in formula funding;
• $5 million to fund Medical College of Georgia research initiative;
• $2 million to fund GALILEO (Georgia Library Learning Online); and
• $1.25 million to fund PINES (Georgia Public Library Service's Public Information Network for Electronic Services).

Capital Budget

• $86 million for five "majors" projects; and
• $52.1 million for 12 "minors" projects;
• $60 million for MRR.

Chancellor: Dollars/Students Gap 'Our Biggest Challenge'

Accompanied by several members of the Board of Regents and a number of University System of Georgia presidents, Chancellor Thomas C. Meredith used his Jan. 20 presentation on the Fiscal Year 2005 Budget to hammer home the ever-widening gap between the number of state dollars devoted to higher education in Georgia and the number of students filling USG classrooms.

"This is the crux of our dilemma and our biggest challenge - fewer dollars, more students," Meredith said, showing members of the General Assembly's Joint Appropriations Committee a chart tracking state appropriations per full-time equivalent (FTE) student.

Since FY '01, when state appropriations hit $8,294 per FTE student, these dollars have decreased 17.3 percent to $6,857 per FTE student. The gap between state dollars and students is attributable largely to the $253 million in cuts the University System has weathered since November 2001, Meredith said.

In wrestling with how to achieve the 5 percent reductions ordered for the FY '05 Budget, University System officials made a conscious decision to protect instruction, first and above all, the chancellor told legislators. The next priority was to protect whatever USG institutions need to serve their students. Public service institutes were next, followed by the University System's special funding initiatives.

Turning to the Governor's recommendations for the System's FY '05 Budget, Meredith pointed out that overall cuts to the USG's public service institutes total almost 33 percent and, for the special funding initiatives, they amount to 50 percent.

"To cut the [University of Georgia's] Carl Vinson Institute by 12 percent, to reduce our P-16 Initiative by 50 percent, and to eliminate funds for the Georgia Teacher Center at Kennesaw State University entirely are hard blows to take," the chancellor said. "However, in this budget climate, this is the price of protecting classroom instruction, our core mission. I hope we can find external, non-state funding to continue some of these important programs at their current levels."

The chancellor expressed sincere appreciation for the Governor's recommendation to add to the budget nearly $123 million in new formula funds for the University System. This includes $108 to support the 8.4 percent enrollment growth experienced in Fall 2002 and Spring 2003; $8.2 million for maintenance and operation of USG facilities; $1.56 million to fund the Optional Retirement Plan; and $4.8 million to fund additional health insurance costs for USG retirees. "As I've said many times, the formula is our 'bread and butter' and is absolutely essential," he noted.

Meredith also thanked the Governor for recommending a $5 million enhancement to strengthen the Medical College of Georgia's research capabilities in health and $1.25 million to fund PINES, (Public Information Network for Electronic Services), an initiative of the Georgia Public Library Service. He also called attention to the Governor's recommendation to transfer funding for GALILEO (Georgia Library Learning Online) from lottery funds to state appropriations, action that "truly has helped save this important educational resource for the state."

Perdue's recommendations to spend a total of $86 million on five projects on the regents' Major Capital Priorities List and $52 million for 12 projects on the "minors" list (projects under $5 million) are truly welcome news, Meredith said. Also welcome is the $60 million recommendation for major repairs and renovations, otherwise known as MRR funds. "Due to budget cuts, we have been forced to significantly scale back needed major repair and renovation projects on our campuses," Meredith noted. "These dollars are critical for infrastructure maintenance."

Before concluding his remarks, the chancellor urged legislators to carefully consider Georgia's reputation among educators in acting on the Governor's recommended 2 percent salary increase for teachers.

"Among the Southern Regional Education Board states, Georgia had been third in faculty salaries, but with Virginia's salary commitment this year, we have slipped to fourth," Meredith said. Historically, "Georgia has been successful in its efforts to keep and attract top faculty because of the state's commitment to highly competitive salaries. We must be watchful. A combination of successive years with little or no salary increase and our significantly increased use of part-time faculty could make it more difficult to attract and retain top faculty in the coming years."

Spotlight on ... Representative Louise McBee

Rep. Louise McBee of Athens is in her second year of chairing the House Higher Education Committee and is vice chair of the Retirement Committee. She also is a member of the House Appropriations Committee.

McBee was first elected to the Georgia House of Representatives in 1991. Now serving her fourth term representing House District 74, she is the dean of the Clarke County legislative delegation.

Born in Tennessee, she holds a bachelor's degree from East Tennessee State College, a master's degree from Columbia University, and a Ph.D. from Ohio State University.

McBee began her career as a high school teacher in Virginia, and rose to dean of women at East Tennessee State University. From 1963 until her retirement in1988, McBee held several posts at the University of Georgia, including dean of women, dean of students, assistant vice president for instruction, and associate, senior associate and acting vice president for academic affairs. Today, a UGA lecture series bears her name, and McBee is an emeriti scholar.

McBee has served as the national president of the Alpha Lambda Delta Honor Society and as vice president of the National Association of Women Deans, Administrators and Counselors.

A Fulbright scholar and the author or co-author of four books and of numerous scholarly articles, McBee was one of 11 recipients of the 2002 Governor's Awards in the Humanities. McBee was honored in part for having nurtured the development of humanities programs throughout her tenure at UGA.

Among other things, she is credited with the development of the university's Women's Studies program and with having taken the lead in creating and finding funding for the Center for the Humanities and Arts.

Spotlight on ... Senator Bill Hamrick

Sen. Bill Hamrick of Carrollton is in his second year of chairing the Senate's Higher Education Committee. He also is an ex-officio member of the Education Committee and a member of the Judiciary Committee, the Rules Committee, the Ethics Committee and the Health and Human Services Committee.

A lifelong Carroll Countian, Hamrick was first elected to the Georgia Senate in March 2000 to serve out the unexpired term of the late Sen. Sam Roberts. He was elected to his second term in November 2002 and represents Senate District 30.

Even in this brief period, Hamrick has had many legislative accomplishments and has moved into a leadership position within the Senate. An early legislative accomplishment was the Corruption Prevention Act, which makes the prosecution of political corruption in Georgia easier. He also has passed legislation that promotes the savings of tax dollars through an increase in the amount of personal and business property exempt from ad valorem taxes, as well as legislation that facilitates information sharing between state and federal authorities, including information related to terrorist activities. Hamrick holds a bachelor's degree from Auburn University and a law degree from the Georgia State University College of Law.

Before his election to the state Senate, Hamrick served on the Governor's Task Force for Drug Suppression and as an intern helping to prosecute criminal cases in the DeKalb County District Attorney's Office. Today, Hamrick has a law practice in Carrollton.

He has been featured in Georgia Trend magazine's annual "Forty Under 40" cover story, highlighting rising stars in Georgia under the age of 40.