Comments (0) | |

Friday, Feb. 13, 2009

Property value cap moves to state Senate

ATLANTA — A long-term cap on property tax assessments failed to pass the Georgia House of Representatives on Thursday, but a two-year ban on assessment increases did.

The moratorium now moves to the state Senate for consideration. If finalized, it would mean local tax offices couldn’t increase property values, but it would not preclude local governments from raising millage rates.

Together, those two values are used to calculate annual property taxes.

The legislation, House Bill 233, is the latest Republican attempt to reform property taxes in Georgia, and it passed the House 110-63.

It’s not clear how the bill would eventually affect Bibb County, which has had a string of problems with its tax digest. But local officials fear the legislation would invalidate the county’s ongoing reassessment, meaning a nearly $2 million contract and untold man-hours, would have been wasted.

And because the legislation would then lock in 2001 property values due to Bibb County’s failure to redo its digest since then, the county could end up paying large fines to the state for having out-of-whack tax values.

Altogether, Bibb officials said the effect on local government budgets could be devastating. Local legislators may get some sort of exemption for Bibb County built into the bill, but so far House leaders have shown no appetite for such a change. There is already an exception for Houston County and other communities that have enacted millage rate caps.

“Counties that have put themselves in these situations by not following the law, we cannot allow exceptions,” House Majority Leader Jerry Keen, R-St. Simons Island, said after Thursday’s vote.

“We’ll just have to wait and see,” said state Rep. Allen Peake, R-Macon. “It’s still got to go to the Senate.”

Peake voted for the bill, as did all of Middle Georgia’s Republicans in the House. Midstate Democrats voted no, with the exception of state Rep. Bobby Parham of Milledgeville.

Thursday’s vote broke largely along party lines, and Keen blasted House Democrats for “playing politics.” Democrats skewered the bill, calling it unconstitutional and an attack on local control.

City councils, county commissions and school boards should control property taxes, not the state, many Democrats said. Inadequate state funding for education drives property taxes higher, they argued.

“What options do we give our local communities?” House Minority Leader DuBose Porter, D-Dublin, said. “We’ve fallen down on our side.”

Republicans said local governments can still raise the money they need, but they’ll have to raise millage rates instead of allowing reassessment increases to raise tax bills. They also passed out a spreadsheet showing reserve balances for every Georgia county as of fiscal 2007. It showed healthy balance sheets in most counties, with some holding more than enough in reserve to cover half their annual budgets.

Proponents moved to the moratorium strategy as it became clear there wasn’t enough support for a long-term cap that would have limited assessment increases to 3 percent a year. That would have required a two-thirds majority, impossible without more support from Democrats.

It also would have required a statewide referendum, which Keen called “the ultimate local control.”

State Rep. Bubber Epps, a Democrat who represents Twiggs and Wilkinson counties as well as parts of Bibb and Jones counties, said he voted against the bill because his local county commissioners were against it.

State Rep. Willie Talton, a Republican who represents a portion of Houston County, said the bill should keep property taxes down.

“With the economy and everything like it is, it’s giving them some kind of relief,” he said.

The measure wouldn’t keep property values from being lowered by local tax offices. In fact, along with the two-year moratorium on increases, the bill would require all 159 Georgia counties to do a reassessment between now and January 2011. The idea, supporters said, is that the current real estate market should lead to lower property values if reassessments are done now.

That could mean that Bibb County, after throwing away a reassessment the tax office worked on for the last year and a half, would have to pay for another one.

To contact writer Travis Fain, call 361-2702.