Feb. 13, 2026 – Issue 05

The House and Senate have recessed for the President’s Day weekend but not before passing several significant measures, setting up the chess board for additional moves on dueling tax reform proposals. When they return on Tuesday, Feb. 17 for Day 19, all eyes will be on the Gold Dome to see what is next on these measures and the FY 2027 budget.

Legislators have about three weeks left to get their bills passed out of their assigned committees and chamber of origin; Crossover Day is Fri., March 6. Keep reading to weigh in and learn more about the state and federal issues we’re following this week.

 

Call to Action

As various tax proposals are moving rapidly through the legislative process, we need to know of your concerns or support surrounding the elimination of the tax credits as written in SB 476 – more information about the proposal is below. Please share your feedback related to the potential elimination of the tax credits through this form. SB 476 includes the following:

• Elimination of insurance premium tax credits for insurance companies
• Elimination of tax credit for depository financial institutions
• Elimination of tax credits for manufacturers of medical equipment and supplies, pharmaceuticals, and medicine
• Amends tax credits for port traffic in the state
• Elimination of tax credits for businesses headquartered in state and full-time jobs
• Eliminate tax credits for manufacturing of cigarettes for exportation
• Eliminates Data Center Sales & Use Tax exemption
  
  
  

UNDER THE GOLD DOME

Tax Proposals on The Move

Throughout 2025, the most discussed legislative priority for the Senate Majority Caucus focused on eliminating Georgia’s state income tax. The Senate Special Committee on Eliminating Georgia’s Income Tax met nearly half a dozen times during the interim to discuss the topic. Now, the majority party has started to deliver on the outcomes of that study.

Introduced by Senate Appropriations Chair Blake Tillery, SB 476, the "Income Tax Reduction Act of 2026," proposes significant changes to Georgia's tax laws, primarily focusing on reducing income tax rates and modifying various tax credits and exemptions.

Starting January 1, 2026, the individual income tax rate will be reduced to 4.99%, and the annual reduction provision will be removed. Corporate and partnership income tax rates will also be set at 4.99%. The standard deduction for individuals will be substantially increased, from $24,000 to $100,000 for married couples filing jointly and from $12,000 to $50,000 for single filers. Importantly, all tax credits against Georgia taxable net income will have a sunset date of January 1, 2032.

As mentioned in our above Call to Action, the legislation also automatically repeals numerous specific tax credits including:

• Depository financial institutions
• Eligible teleworking expenses
• Personal protective equipment manufacturers
• Manufacturers of medical equipment and supplies, pharmaceuticals and medicine
• Existing manufacturing and telecommunications facilities in Tier 3 or 4 counties.
• Base year port traffic increases
• Alternative fuel, low-emission, zero-emission vehicles and electric vehicle chargers
• Businesses headquartered in state and full-time jobs
• Businesses engaged in manufacturing cigarettes for exportation
• Business enterprises that purchase or lease motor vehicles to provide employee transportation

Additionally, the bill reduces the tax credit for low-income housing and qualified investments in a research fund from 25% to 12.5%, and repeals various sales and use tax exemptions for items like videotapes, aircraft, watercraft, motor vehicles under certain conditions, bait for crabs, advertising inserts, pollution control machinery, high-technology computer equipment, data center equipment, materials for certain building construction, natural gas, and boat maintenance and repair. SB 476 passed out of the Senate on Feb.12 by a vote of 32-18.

While there is disagreement by the Senate with the posture by the House that all tax related legislation must begin in that chamber, the Senate Finance Committee passed an adopted substitute of HB 134, stripping the language of its original manufactured homes sales and use tax language, and replacing it with the language within SB 476. The Senate passed the amended measure 31 -17 also on Thursday, sending it back to the House for its consideration.

SB 477 reduces Georgia's personal income tax rate, with a phased reduction to 3.99% by 2028. Additionally, the bill lowers the corporate and partnership income tax rates to a flat 4.99% and increases the standard deduction for individuals, raising it to $32,000 for married couples filing jointly and $16,000 for single filers or married individuals filing separately. These changes are set to take effect for taxable years beginning on or after January 1, 2026. SB 477 passed out of the Senate with a vote of 31-14. Similar to the action the Senate Finance Committee took on SB 476, language from HB 463 was stripped and replaced with the language included in SB 477. HB 463 was sent back to the House after passing the Senate 32-14.

SB 476 and SB 477 will be assigned to committee in the House next week, however, because HB 134 and HB 463 already passed the House, the body only needs to hold an Agree/Disagree vote on the substitutes to both bills before they reach Governor Kemp’s desk. Lobbyists reading the tea leaves are waiting to see if the House returns their bills back to their original form or not.

Cobb Legislative Delegation Update

The Cobb Delegation was joined by Mayor Michael Owens and council members from the City of Mableton this past Tuesday. Leaders from the City of Mableton presented their legislative priorities for the year. Mayor Owens expressed the City’s goal of raising their presence down at the Gold Dome to advocate for policy and legislation that work to continue aiding in the City of Mableton’s healthy and sustainable growth for its citizens and businesses.

City Manager Bill Tanks gave the delegation an update on the current progress of the city including city employees, increasing to 57 employees from the original three, all in eight months. Tanks went on to highlight the progress the city has made on providing services to its citizens including key functions such as the Code Enforcement Department, the addition of recreational activities for citizens, the Planning and Zoning Department, and alcohol permitting for businesses. Additionally, the City of Mableton has hired a Code Enforcement Director, Chief Building Official, and the city is in the process of hiring a Parks Director.

New Legislation of Interest

The following pieces of legislation dropped this past week that are of interest to the Chamber in relation to our State Legislative Agenda. As always, please feel free to view the legislation we are tracking each week at the Gold Dome by visiting our Relevant Legislation tracker page on our website.

HB 1233 by Rep. Kasey Carpenter
Legislation which allows local governments in Georgia to waive development impact fees, which are charges imposed on new developments to help fund public infrastructure like roads and schools, for projects that create affordable or workforce housing.
Assigned to the House Governmental Affairs Committee

HB 1262 by Rep. Eddie Lumsden
Legislation which increases the maximum monetary penalties that the Commissioner of Insurance can impose for certain violations of Georgia's insurance laws. Specifically, it raises the penalty for health insurers failing to comply with mental health parity reporting requirements from a maximum of $2,000 to $10,000 per violation, and to $25,000 if the insurer knowingly violated the law, increases the general enforcement penalties for any person licensed or required to be licensed under the insurance code from $2,000 to $10,000 per violation, and to $25,000 if the violation was known. It also raises penalties for violations of the "Surprise Billing Consumer Protection Act" from $2,000 to $10,000 per violation, or $25,000 if the violation was known. Finally, for prepaid legal services plans, the bill increases the maximum fine for offenses from $2,000 to $10,000.
Assigned to the House Insurance Committee

HB 1277 by Rep. Matt Barton
Legislation which increases the project cost threshold for public roads and airports requiring environmental evaluations from $100 million to $200 million, with provisions for annual inflation-based adjustments starting in July 2027. It revises various reporting requirements for the Department of Transportation, including mandating an annual fiscal year report to be published by January 15 each year and requiring detailed status reports for programmed projects on the department's website. Additionally, the bill modifies procedures for property disposal by the department, raising the property value threshold for negotiated sales from $75,000 to $150,000 and introducing options for online public auctions. This is agency legislation.
Assigned to the House Transportation Committee

HB 1285 by Rep. Mike Cheokas
Legislation which amends Georgia law regarding local sales and use taxes. Currently, there is a general limit of 2% on the total amount of these local taxes that can be imposed in any jurisdiction, with certain exceptions for educational purposes, transportation projects, and specific local option taxes. This bill proposes to allow counties to collect an "enhanced homestead option sales tax" and a "local option sales tax" in addition to existing authorized taxes.
Assigned to the House Ways and Means Committee

SB 474 by Sen. Randy Robertson
Legislation which amends Georgia's state income tax laws to exclude overtime compensation from taxation for full-time employees paid by the hour, starting with taxable years beginning on or after January 1, 2027. This exemption applies to compensation for work exceeding 40 hours a week and overtime paid according to the federal Fair Labor Standards Act of 1938, with a specific provision for railway employees whose overtime is defined by collective bargaining agreements.
Assigned to the Senate Finance Committee

SB 488 by Sen. Ed Setzler
Legislation which establishes that generative artificial intelligence (AI) systems, defined as computer-based systems that use machine learning to create content like text, images, or audio, will be treated as personal property for the purpose of product liability lawsuits alleging injury to a minor. This means that if a minor is injured because a generative AI system they used, consumed, or were affected by was not in good condition when sold by a manufacturer or product seller, and this condition caused the injury, the AI system can be considered a defective product. The bill allows product sellers of these AI systems to be held liable for damages in such cases and establishes that it is assumed to be true unless proven otherwise, that the manufacturer and seller had a responsibility to warn about the risks of injury associated with these AI systems.
Assigned to the Senate Judiciary Committee

SB 491 by Sen. Ed Setzler
Legislation which amends an existing law concerning the Cobb Judicial Circuit to change the salaries of assistant district attorneys, establishing a minimum annual salary of $83,400.00 for full-time or part-time assistant district attorneys, effective January 1, 2027, with the exact compensation to be set by the District Attorney.
Assigned to the Senate State and Local Governmental Operations Committee

SB 492 by Sen. Ed Setzler
Legislation which amends an existing law concerning the State Court of Cobb County to increase the number of assistant solicitor positions. Specifically, by allowing additional assistant solicitors to be hired, with the number tied to the full-time magistrates in the Magistrate Court of Cobb County, plus seven more. Assistant Solicitors will be paid a minimum of $83,400 annually starting in 2027, with the exact salary determined by the solicitor-general, and paid from county funds.
Assigned to the Senate State and Local Governmental Operations Committee

SB 495 by Sen. Sally Harrell
Legislation, known as the "Age-Appropriate Design Code Act," which imposes strict privacy and safety regulations on online platforms likely to be accessed by minors, requiring high-privacy default settings, protection against compulsive use, and giving minors tools to control their online experience, such as blocking users and managing algorithmic feeds. The bill will be enforced by the Attorney General with potential penalties of $5,000 per violation and is set to become fully effective on January 1, 2027.
Assigned to the Senate Children and Families Committee

ADVOCACY IN ACTION

National Guard Day at the Capitol

Wednesday was Georgia National Guard Day at the Capitol. Major General Richard D. Wilson, Adjutant General of the Georgia National Guard, and members from the Georgia National Guard joined the House and Senate to advocate for Georgia National Guard funding and highlight the many accomplishments of the almost 15,000 members of the Georgia National Guard.

Major General Wilson addressed the House and Senate chambers and highlighted accomplishments such as the Georgia National Guard being selected as the 2025 best National Guard Headquarters by the Association of the United States Army and the Georgia Air National Guard receiving the Air and Space Force Operation Excellence Award three out of the last five years.

Major General Wilson additionally highlighted the current operations that the Georgia National Guard are currently and were formerly engaged in including assisting Northeast Georgia during Winter Storm Fern and assisting two years ago with response and recovery efforts during hurricanes Helene, Debbie, and Milton.

Major General Wilson finished by thanking the legislature for the funding appropriated to the Georgia National Guard that has allowed them to continue renovation and modernization of their armories and readiness centers across the state.

The Georgia National Guard was also recognized in the House and Senate with both HR 1237 and SR 701.

Georgia Chiefs of Police Day

The Georgia Association of Chiefs of Police held their Day at the Capitol this past Wednesday. A multitude of Police Chiefs and law enforcement officials joined members from both the House and Senate advocating for all law enforcement officers and their families. The Chiefs of Police and Law Enforcement Agency Heads were recognized in both the Senate and the House with SR 566 and HR 1065.

Georgia Retailers Day

This past Wednesday was also Georgia Retailers Day at the State Capitol and Cobb County’s retail businesses were well represented. Organized by the Georgia Retailers Association, retailers from across the state, including Cobb County’s own RaceTrac and The Home Depot, set up tables in the South Wing of the Capitol to highlight 1.7 million jobs and $45 billion of direct Georgia GDP impact.

LOCAL LOOK

Cobb Chamber Hosts the Cobb Municipal Association

On Tuesday evening this week, the Cobb Chamber had the honor of hosting the Cobb Municipal Association for their first meeting of 2026. The Cobb Municipal Association is comprised of the seven cities in Cobb County which are Acworth, Austell, Kennesaw, Mableton, Marietta, Powder Springs and Smyrna.

Chamber President and CEO, Sharon Mason, provided updates to the group on Chamber activities and expressed the Chamber’s commitment to assisting and working with our municipalities to ensure that Cobb continues to be a desirable place to live, work, and start a business. She emphasized the importance of the cities and county working with the business community to renew the upcoming SPLOST measure, and highlighted upcoming efforts from the Chamber on education and advocacy to ensure its passage.

The group additionally received a legislative update from Leona Rittenhouse who is part of the government relations team at the Georgia Municipal Association.

Next Week at the Capitol

Mon., Feb. 16 – Recess (President’s Day)
Tues., Feb. 17 – Legislative Day 19 
Wed., Feb. 18 – Legislative Day 20 
Thurs., Feb. 19 – Legislative Day 21 
Fri., Feb. 20 – Legislative Day 22  

FEDERAL UPDATE

DHS Shutdown Appears Imminent

With Senators leaving Washington this week without a budget deal, the Department of Homeland Security (DHS) is poised for a partial funding lapse beginning at 12:01 a.m. ET on Sat., February 14, 2026, following the expiration of its current continuing resolution at the end of Friday, February 13.

Congress adjourned for a recess without passing legislation to extend funding or enact a full-year appropriations bill for the agency, amid ongoing partisan disagreements primarily centered on demands for reforms to immigration enforcement practices, particularly those involving Immigration and Customs Enforcement (ICE) and Customs and Border Protection (CBP). Negotiations between Senate Democrats, Republicans, and the White House have not produced an agreement, with Democrats seeking additional limits on certain enforcement operations and Republicans maintaining that existing funding levels and policies should proceed without such changes.

This lapse affects only DHS among federal agencies, as other departments received full-year funding earlier in 2026. Over 90% of DHS personnel, including those at the Transportation Security Administration (TSA), Federal Emergency Management Agency (FEMA), U.S. Coast Guard, and Cybersecurity and Infrastructure Security Agency (CISA) are designated as essential and will continue performing critical duties, though without pay during the lapse period.

Core immigration enforcement activities through ICE and CBP are expected to experience minimal disruption, as much of their operational funding derives from sources outside the lapsed appropriations. The shutdown could last at least until Congress reconvenes around Feb. 23, unless lawmakers return earlier to reach a compromise. Impacts may include potential delays in non-essential services, such as certain administrative functions or rulemaking processes, while essential public safety, border security, disaster response, and aviation security operations are anticipated to persist largely as normal.

If You Have Made It This Far…

Point of Personal Privilege

A huge shout out goes to the Senate Press Office (SPO) for their annual Senator Valentine’s Day cards for download and use. Click to see this year’s collection, including our newest Cobb County Senator Jaha Howard. Thanks to the members of the Senate for being such good sports and letting SPO entertain us once again! Happy Valentine’s Day from your Cobb Chamber Advocacy Team!

If you have any questions about the Cobb Chamber Government Affairs Committee, the Cobb Chamber legislative priorities or advocacy in general, please reach out to Amanda Seals, Executive Vice President of Advocacy and Government Relations, or Coleman Loftin, Senior Manager, Government Affairs and Advocacy.