Middle Georgia schools want to opt out, say no to property tax relief bill. What it means

During November’s General Election, over 60% of Georgia voters approved House Bill 581, a floating homestead exemption legislation that promises property tax relief for homeowners.

But HB 581, also known as the Save Our Homes Act, limits the amount of tax increases allowed on the assessed value of homestead properties to the rate of inflation. This cap on increased taxes is set to become effective on Jan. 1 unless local governments or school districts choose to take advantage of a one-time opportunity to opt out.

School districts in Middle Georgia are debating future moves on the measure, with decisions to potentially impact some of them for the next 50 years. Bibb County Schools, Monroe County Schools and Twiggs County Public Schools have already declared plans to opt out of the exemption.

Why school districts would want to opt out of this tax cap

While HB 581 was passed to address rising property tax concerns and alleviate burdens for eligible Georgia homeowners, school officials say opting out of that relief would allow districts to maintain control over local tax policies.

Maintaining local control means that school boards can tailor their own tax rates to fit growing needs in their respective communities, such as setting millage rates, Monroe County Schools Superintendent Jim Finch said at a December board meeting.

Opting out also means that boards of education can keep collecting tax revenue with no caps in place.

“Opting out will ensure long-term financial stability and flexibility for our district, protecting essential revenue streams necessary for student achievement, staff effectiveness and stakeholder engagement,” Eric Bush, chief financial officer for the Bibb County School District, said during a board meeting in December.

Bibb official warns of ‘drastic’ drop in education money

For the Bibb County School District, opting into HB 581 would result in over $700,000 of revenue lost for the 2024 fiscal year alone, with cumulative losses of about $3.7 million over a seven-year period, Bush said in a presentation to the board in December.

“School districts can only levy 20 mills. This is a 50-year opt-in, which is a long time, and that could drastically reduce our ability to finance education in the town if we opt-in,” Bush said.

BCSD officials said in a memo at a recent board meeting that opting in to this tax cap risks substantial revenue reductions, “undermining our ability to fund strategic initiatives such as improving institutional quality, infrastructure, and safety.”

The district is also considering how the decision will guarantee long-term stability by adapting to changing economic conditions and maintaining community priorities for strong educational outcomes, according to a BCSD memorandum.

In Monroe County, Finch also expressed concern about the measure restricting revenue growth and reducing financial flexibility, leading to budget shortfalls as education services rise. Finch said the district could offer tax relief without being locked into this law.

“I’m all about local control,” Finch said at the meeting. “But if we’re going to provide taxpayer relief, we don’t need it as a handout from the state of Georgia … we can do that ourselves by rolling back our millage rate…”

Other schools’ decisions on HB 581

The bill, described as a one-time decision with long-term impacts, has put some pressure on school officials. While local governments have until March 1 to determine whether to opt out, there is currently no way to reverse a choice once it is made.

Lionel Brown, superintendent of Peach County Schools, said the district has not yet made a decision to opt in or out. The Peach County Board of Education will discuss its options again in January before making a final decision, he said.

“We’ve been reviewing our financial trend data, consulting with our county and city government entities, our financial advisors and attorneys, and speaking with other school systems. As you can see, we aren’t taking the decision lightly,” Brown said in an email.

The Houston County School District has not yet discussed the bill item at any board meetings, district spokesperson Jennifer Jones said in an email.

Local governments that are opting out of the floating homestead exemption must pass a resolution and hold three public hearings. Here is the BCSD timeline for public hearings:

• Public Hearing 1: Jan. 14, 2025 at 6 p.m. at 2003 Riverside Drive
• Public Hearing 2: Jan. 21, 2025 at 11 a.m. at 484 Mulberry St.
• Public Hearing 3: Jan. 21, 2025 at 4 p.m. at 484 Mulberry St.
• Called Board of Education Meeting to vote on HB 581: Jan. 21, 2025 at 4:30 p.m. at 484 Mulberry St.

This story was originally published December 31, 2024 at 1:02 PM.