Joint Tax Credit Review Follow Up

On Wednesday, September 20, GAM representatives served on a panel that staunchly defended Georgia’s tax exemptions and credits that support manufacturing.  The Joint Tax Credit Review Panel (Panel), tasked with reviewing the state’s tax credits and exemptions, held its third meeting this year, this time at Berry College in Rome, Georgia.  The focus of the meeting was on manufacturing.  GAM turnout was outstanding, with numerous Association members filling up the Christopher Brown Pavilion to watch the proceedings.

The panel consisted of:

• Clay Jones, GAM Vice President and General Counsel
• Michael Edwards, Senior VP of Operations of Mannington Mills, Interim GAM Tax Council Chair and Vice Chair of the Association;
• Ballard Betz, President of The Lewis Chemical Company and GAM Board member;
• Jason Burleson, Tax Director for Pirelli Tires; and
• Missy Kendrick, the President of the Rome / Floyd County Development Authority, a GAM Associate member.

Mr. Jones spoke on behalf of GAM and addressed the importance of manufacturing to Georgia, lauded Georgia as a great place for manufacturing investment and defended the critical importance of the sales tax exemptions on energy and business inputs used in manufacturing.  He praised Georgia’s “reliable, steady, pro-business tax system” that helps “ensure a level playing field against other states that aggressively try to attract manufacturing investment” and “provides confidence to the manufacturing community that drastic changes will not be seriously considered.”

Mr. Edwards stressed the commitment Mannington Mills has made to Georgia for more than 50 years thanks to the state’s business environment.  He specifically defended the state’s tax exemptions and credits, including the research and development (R&D) tax credit, which spurred the company to relocate its R&D headquarters from New Jersey to Georgia and its San Jose operations as well to our state.  He emphasized the importance of the R&D tax credit as helping Mannington “push through growing pains and come out more resilient.”

Mr. Betz recounted the history of The Lewis Chemical Company and the deep and thorough commitment the company has made to Georgia.  He pointed to Georgia’s pro-business reputation as necessary to make sure our domestic manufacturers can compete on an international scale.  He specifically advocated for the importance of exempting from sales tax the purchase of energy and other business inputs, noting that such exemptions are “absolutely essential to maintaining our already razor-thin competitive viability.  As our country strives to restore manufacturing greatness in the interest of both job creation and supply chain self-reliance, we cannot afford to give foreign competition any undue advantage over our domestic manufacturers.”

Mr. Burleson contributed the key perspective of an international company that looks at multiple sites around the globe when deciding where to initiate, retain, expand or even contract its capital investment.  He said the company leaders, who reside in Milan, Italy, are committed to Georgia because Georgia is an attractive place for investment.  Given the fierce level of competition in manufacturing industries, however, Georgia’s attractive position must be maintained because manufacturers have multiple options, not just here in the United States but around the world.

Ms. Kendrick supported the Panel’s review and strongly pointed out that “we have been successful in the State of Georgia because of the tax policies we have.”  She expressed confidence that the tax incentives offered by Georgia to manufacturers will prove their benefit and urged the panel not to do anything that would hamper the ability of Georgia’s manufacturers to remain competitive.  “These other states are watching what we’re doing . . . waiting on us to make changes that impact our ability to remain the number one state in which to do business,” she said.

The response to these presentations was overwhelmingly positive from legislators and others in attendance.  GAM organized this team effort to ensure that our legislative leaders hear from us and take into consideration the vital importance of manufacturing to Georgia’s economy and the sustainability of the many local communities in which our members are located.

The Joint Tax Credit Panel will meet three additional times before producing a final report with recommendations for consideration by the General Assembly in its 2024 Session:

• October 4^th in Athens, beginning at 9:00 a.m. at the University of Georgia Studio Production Learning Center, 890 Athena Drive, Athens, GA 30605.  The expectation is that this meeting will focus on the film tax credit.  GAM will be present and we will report back after the meeting;
• November 8^th (location TBD); and
• November 29^th (location TBD).

If you would like to watch the video link of the meeting at Berry College, please click on the following link:  https://www.youtube.com/watch?v=vdL_8IrKxPQ.  The GAM-led presentation begins at about an hour and 27 minutes into the video.