Budget Trends

The $32.4 billion state budget signed into law by Gov. Kemp for FY 2024, which starts July 1, 2023, represents a relatively flat level of spending that remains well below the state’s capacity and falls short of meeting the needs of Georgians across core areas, from access to health care to public education. Georgia started the previous fiscal year with the state government employing nearly 6,400 fewer full-time employees in FY 2022 than it did in 2018, down nearly 9.5 percent. The state also struggled in a competitive job market to combat an all-time high employee turnover rate of over 25 percent.

Georgia’s governor holds unilateral authority to set the state’s revenue estimate. As such, under Gov. Kemp’s direction, the state responded to the 2020 pandemic-induced downturn by cutting spending and thinning its workforce under revenue estimates that projected state revenue growth would fall well below the rate of inflation from 2020-2023. Simultaneously, the unprecedented, strong fiscal response at the federal level helped to create a rapid rebound and surge in economic activity, which was reflected in higherthan-expected state tax collections that continued from FY 2021 through 2023. The combination of these dueling responses has produced a cycle in which state revenue collections continue to significantly outpace spending, adding to an already historic level of unobligated reserves available for allocation.

Entering fiscal year 2024, Georgia stands at a key inflection point, with an unprecedented level of resources on-hand, along with a current-year revenue estimate that is significantly below prior year collections for both FY 2022 and 2023. These indicators demonstrate the clear opportunity available to state leaders to respond to long-standing needs across public education, access to health care and economic mobility during the 2023-2024 session of the General Assembly—and reinforces that state leaders are actively choosing to leave resources on the table to accrue increasingly large reserves—while making no active plans for their use, rather than deploying them to meet urgent needs.