As companies across America take a stand on guns after the Florida school massacre, Delta Air Lines withstood swift political retribution in its home state of Georgia for cutting ties with the National Rifle Assn.
Ignoring warnings that the state’s business-friendly image could be tarnished, Republicans in the Legislature voted Thursday to kill a tax break that would have saved Delta millions of dollars in sales tax on jet fuel, and on Friday, the governor signed it. The proposal wasn’t controversial until Delta announced last weekend that it would no longer offer discounted fares to NRA members.
“I hope they are better at flying airplanes than timing PR announcements,” Georgia House Speaker David Ralston, a Republican, said after his chamber gave final approval to a larger tax-cut bill that was stripped of the jet fuel tax exemption.
The Feb. 14 slayings of 17 students and educators in Parkland, Fla., by a gunman armed with an AR-15 assault-style rifle has prompted retailers including Walmart, Kroger and Dick’s Sporting Goods to tighten their gun sales policies. Meanwhile, Delta and other companies including MetLife and Hertz have ended business ties with the NRA.
Delta’s decision triggered a showdown with pro-gun lawmakers in Georgia, where the Atlanta-based airline is one of the largest employers; it has 33,000 employees statewide. Republican Lt. Gov. Casey Cagle, the state Senate’s presiding officer, vowed Monday to stop any tax break that would benefit Delta.
“Corporations cannot attack conservatives and expect us not to fight back,” tweeted Cagle, who is also running for governor.
GOP lawmakers amended a sweeping tax bill to eliminate a fuel-tax exemption worth at least an estimated $38 million to Delta and other airlines.
The Senate passed the tax measure 44-10, with Democrats accounting for all of the no votes. The House — which had passed an earlier version with the jet fuel exemption before the Delta controversy erupted — followed with a 135-24 vote.
Republican Gov. Nathan Deal criticized the Delta controversy, calling it an “unbecoming squabble,” but said he would sign the broader tax measure in whatever form it passed. He followed through Friday.
NRA spokeswoman Catherine Mortensen had no comment Thursday.
Delta did not respond to messages seeking comment Thursday, but on Friday, before Deal signed the bill, the airline said it is studying whether studying whether to end discounts for “politically divisive” organizations.
The Delta provision barely came up Thursday in either legislative chamber during debate on the underlying tax bill, designed in part to give back to Georgia taxpayers $5.2 billion in extra state revenue expected over the next five years because of the recent federal tax overhaul.
“Obviously the political environment does sometimes get a little testy, but in the end, it’s all about the product,” said Cagle, who is running this year to succeed the term-limited governor. “And the product we have today is something that all of us can be very proud of.”
GOP Sen. Michael Williams, another gubernatorial candidate, praised Republicans for holding out in the face of criticism from the news media and corporate America.
“We’ve stayed strong,” Williams said. “We’ve even stayed strong against our own governor.”
Among Democrats voting against the tax bill was Sen. Nikema Williams of Atlanta, who applauded companies that have taken swift action on guns after the Florida tragedy. She said Delta’s decision to end its NRA discounts led her to support the jet fuel tax break.
“The small steps that Delta and Dick’s Sporting Goods are taking, to take a stand and say enough is enough, is what we all need to be doing as adults,” Williams said. “We’re the leaders of this state and we need to be coming together for solutions, not bullying corporations who are trying to do the right thing.”
Critics of the GOP effort to retaliate against Delta have warned it could backfire by harming Georgia’s ability to attract businesses — including Amazon.com Inc., which recently named Atlanta a finalist in its search for a second headquarters.
“It definitely could have an effect when an outside company looks at something that happens this quickly around election time to one of the largest employers in the state,” said William Hatcher, a professor at Augusta University who studies economic development. “But will it be the dominant factor? I don’t think so.”
Hours before Deal signed the bill Friday, Delta’s chief executive sent a memo to employees, trying to distance the airline from politics and announcing that Delta is reviewing its policy on discounts for “politically divisive” groups.
“Our discounted travel benefit for NRA members could be seen as Delta implicitly endorsing the NRA. That is not the case,” CEO Ed Bastian said in the memo. “While Delta’s intent was to remain neutral, some elected officials in Georgia tied our decision to a pending jet-fuel tax exemption, threatening to eliminate it unless we reversed course. Our decision was not made for economic gain and our values are not for sale.”
Only 13 people used the NRA discount, a Delta spokesman said. He declined to provide a list of potentially divisive groups with access to discounted fares.
Bastian also said Delta was “proud and honored” to have its headquarters in Atlanta — an apparent response to politicians in other states who this week invited the No. 2 U.S. airline to relocate.
Although Deal signed the tax bill excluding the jet-fuel break, he has vowed to find a “pathway” to introduce the exemption again. Bastian, in the memo to employees, called him “a great friend to Delta.”