HB 1085, titled the "Keep Georgia Forested Act," expands and creates income tax credits aimed at forestry manufacturing facilities and related businesses in Georgia. The bill amends several existing tax credit provisions for business enterprises in less developed areas and in tier 1, tier 2, and tier 3/4 counties to add a new forestry manufacturing category. It defines forestry manufacturing broadly to include certain wood, paper, biomass, biofuel, bioenergy, and wood-chemical operations, as well as businesses using forest-derived feedstocks to produce value-added products. It also includes related industries such as alternative energy products, warehousing and distribution, telecommunications, broadcasting, tourism, biomedical manufacturing, and services for the elderly and persons with disabilities in the broader business-enterprise definitions used for some credits.
The bill provides new or enhanced credits for forestry manufacturers based on county tier and investment or job creation. It authorizes additional per-job credits for qualifying new full-time jobs, and it increases investment tax credit percentages for forestry manufacturers in tier 1, tier 2, and tier 3/4 counties. It also allows certain unused forestry manufacturing credits to be transferred or sold to other Georgia taxpayers, subject to notice, reporting, and compliance requirements. These transfer provisions are temporary and automatically repeal at the end of 2030, though credits earned before that date may still be transferred afterward under the bill's terms.
HB 1085 also sets an annual statewide cap on forestry manufacturing tax credits of $250 million, with a separate $100 million cap for credits in tier 3 and tier 4 counties under certain sections. In addition, any future renewal or extension of these forestry manufacturing credits would require approval by a two-thirds roll-call vote of each chamber of the General Assembly. The bill becomes effective July 1, 2026, and applies to taxable years beginning on or after January 1, 2026.
The bill's impact on state law is to create a targeted tax incentive structure within Georgia's income tax code to encourage forestry-related capital investment, job creation, and credit monetization. It modifies multiple existing credit statutes in Title 48 and adds a new section governing aggregate limits and supermajority approval for future extensions. The practical effect is to lower tax liability for qualifying forestry manufacturers and to make these credits more flexible and marketable through transferability.
The overall sentiment reflected in the voting history was strongly favorable. The bill passed the House 159-5, passed the Senate by substitute 47-0, and the House then agreed to the Senate substitute 153-4. The near-unanimous votes suggest broad bipartisan support for the measure, likely reflecting interest in supporting forestry and manufacturing jobs in Georgia. The main points of contention, as reflected in the bill text rather than recorded debate, are the size of the tax expenditure, the breadth of the forestry manufacturing definition, the transferability of credits, and the long-term fiscal controls imposed by the annual cap and supermajority requirement for future renewals.
HB 1085 amends Georgia's income tax credit statutes in Title 48 to create and expand tax incentives for forestry manufacturing facilities across multiple county tiers. It adds a new statutory definition of forestry manufacturing, authorizes enhanced credits for job creation and capital investment, permits limited transfer or sale of unused credits, and imposes annual credit caps and reporting requirements. It also adds a supermajority requirement for future renewals or extensions of these credits, thereby affecting both taxpayers and the General Assembly's ability to continue the program without broad legislative support.
The bill appears to have enjoyed strong support throughout the legislative process, as shown by overwhelming passage in both chambers and the House's agreement to the Senate substitute. The vote totals suggest little organized opposition at the floor level. The measure's framing as a forestry and rural economic development bill likely contributed to its favorable reception, especially given Georgia's forestry sector and the bill's emphasis on jobs and investment in less developed counties.
The most notable areas of potential contention are fiscal and definitional. The bill creates a large annual tax credit cap and broadens eligibility to a wide range of wood, biomass, biofuel, and related manufacturing activities, which could raise concerns about revenue loss or program scope. The transferability of credits may also be controversial because it allows credits to be sold to other taxpayers, increasing their liquidity but complicating oversight. Finally, the requirement that future renewals or extensions receive two-thirds approval in each chamber suggests lawmakers were attentive to limiting automatic continuation of the incentive program.