UPDATE: Clayton County delegation announces soloution to jet-fuel tax problem

Gov. Nathan Deal signed House Bill 918 into law Friday morning. (Special Photo)

ATLANTA — Gov. Nathan Deal signed House Bill 918 into law March 2, a bill that politicians are calling an “historic” income tax cut.

While many residents across the state remained interested in the bill’s move through the General Assembly because of the tax cuts, those in Clayton County kept track for what the bill ultimately didn’t include — the elimination of the state sales tax on jet fuel.

Originally part of House Bill 821, the provision would have put an end to Clayton County’s ability to use taxes collected on aviation fuel purchased at Hartsfield-Jackson airport — a loss of nearly $30 million for the county, including $9 million for the school system.

On March 5, the Clayton County delegation announced they have reached a solution with Deal and Delta over HB 821.

The governor and Delta have agreed to hold harmless and make Clayton County whole until the end of the current Education Special Purpose Local Option Sales Tax and Local Option Sales Tax, delegates stated in a press release.

Rep. Rhonda Burnough said the solution was a “great example of teamwork.”

“The Clayton County delegation, alongside our elected officials and local leaders, fought to ensure that the services our communities and businesses depend on will continue to operate as usual,” Burnough said.

Clayton County’s battle over the tax dollars began in 2013, when the Federal Aviation Administration issued a ruling stating that taxes collected on jet fuel purchased at the airport could be spent only on aviation-related projects. The county was given until December 2017 to comply. In January 2017, Clayton County filed a petition with the 11th Circuit of the U.S. Court of Appeals for review of the Federal Aviation Administration’s decision. The hearing is set to be heard on March 9.

An amendment to the state’s fiscal year 2018 budget includes $29 million to provide one-time grants to local governments that are negatively impacted by the FAA ruling. Of those funds, $27 million will be shared between Clayton County and its seven cities. According to the release, Delta has also made a commitment to Clayton County Public Schools to offset $18 million.

“We are pleased that our children will not be denied access to the resources and opportunities needed to continue receiving a first-class education,” said Rep. Sandra Scott.

Rep. Valencia Stovall said the stopgap solution was a result of bipartisan effort among many.

“We are thankful the residents and businesses of Clayton County will not see any immediate changes; however, a more permanent solution is needed,” Stovall added.

While the new tax bill was signed into law without the jet fuel tax language, Deal said the legislation “will not fix our compliance issue” and that he is “committed to finding a pathway forward for the elimination of sales tax on jet fuel, which is non-negotiable.”

The new bill gives several tax breaks to state residents including:

• Doubling the standard deduction for all Georgia taxpayers

• Reducing the income tax rate for individuals and corporations from 6 percent to 5.75 percent beginning in tax year 2019

• A further tax-rate reduction from 5.75 percent to 5.5 percent in 2020. The reduction is subject to approval from the General Assembly in 2020.

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