AJC.com > Blogs > Get Schooled > Archives > 2007 > December > 03 > Entry
DEL.ICIO.USSchool Taxes In Speaker’s Cross Hairs
The Atlanta Journal-Constitution
I was told every time state House Speaker Glenn Richardson talks about his GREAT plan — for eliminating property taxes in Georgia — something changes. His latest speech, at the education conference I attended Friday, didn’t disappoint.
Now, instead of eliminating all property taxes in one fell swoop and replacing them with increases in sales taxes, Richardson announced he’s scaling down by suggesting the elimination of only school system-imposed property taxes (and only those paid by homeowners) as well as taxes on personal vehicles.
“It is not a total elimination of property taxes,” he said. “It is to give everybody an idea that this will work.”
Not surprisingly, many superintendents and school board members were less than impressed with Richardson’s newest proposal, which they had opposed in its other forms. Some that I talked to were downright incredulous the speaker would suggest partially eliminating school property taxes as a way of testing his idea.
“Why start with us?” asked Jim Simms, superintendent of the Clarke County School District, which includes Athens.
Others view Richardson’s ideas as an attempt to negate Georgia’s 181 local boards of education, which have increasingly relied on property taxes to raise funds since the governor and Legislature instituted so-called austerity cuts.
“When you’ve eliminated the school boards,” Emmett Johnson, vice chairman of the Atlanta Board of Education, told me, “you’ve done what you set out to do.”
Richardson’s remarks were perhaps the most anticipated of the conference. But many of the 900 attendees left with more questions than answers — including, how would state officials determine how much sales tax revenue each school system should receive?
Jack Parish, the outgoing superintendent in Henry County and current president of the Georgia School Superintendents Association, was more diplomatic than most:
“If there is a better way of funding education, we’re all willing to look at it,” Parish said. “But I think … before you make a major change in the way services are funded, you have to take a very, very comprehensive look.”
Comments
By JustMe
December 3, 2007 11:57 AM | Link to this
Richardson is slowly realizing what other people already know - that his plan is stupid and not viable. However, he has painted himself into a corner so with every passing day, or every speech he makes, he slowly tries to find a way for him to save face (modify his ‘plan’).
Boldly stating that “I am going to elimate all property taxes” is a way to get voters excited. After all, who really wants to pay property taxes? However, when you look at the details, his plan is stupid.
Please understand that I am a property owner that pays both City of Atlanta property taxes and also Fulton County property taxes, and I do not even have school age children! However, even I realize that since the State of GA reduced its contribution to education, the only fair and easiest way to make up the shortage is with property taxes.
By decaturparent
December 3, 2007 12:25 PM | Link to this
Ugh, I have commented on this clown’s hair brained idea before on this blog. I’m not going to waste time on Richardson today other than to say the his tragic flaw is that he keeps assuming that we are all as stupid as he is.
Sad really…
Who keeps electing these guys anyway?
By decaturparent
December 3, 2007 12:47 PM | Link to this
Oops - typo on the 3rd line 1st par. “The” should be “that.”
Maybe I am as stupid as Richardson. ??
By Tony
December 3, 2007 1:38 PM | Link to this
Schools and school systems have been an easy target for politicians for a long time. It is very ironic that for us to be able to do our jobs we depend on the “goodness” of the politicians to provide funding and then endure their wrath for the inadequacies that result.
The legislature has made it clear that they have no intention of fully funding public education for all the students of the state. During the last six years there have been huge budget cuts that required local boards of education to pick up bigger portions of the bill. How then are we supposed to believe the state will provide for the educational needs of a community if they have full control of all the tax collections?
By Jen
December 3, 2007 1:41 PM | Link to this
What JustMe said.
I pay both Dekalb County and City of Atlanta property taxes to the tune of $6K. Sure it would be great to not have that.
But I do have a school aged child and he’s going to a great public school as a result of these taxes (and an active PTA).
I also like the local control over this money. I don’t trust Richardson when he says dusbursement to schools won’t change…
By Jeff
December 3, 2007 2:02 PM | Link to this
Question:
What is ‘fair’ about property taxes?
Answer:
NOTHING.
A consumption tax is ALWAYS favorable rather than a property tax because a consumption tax taxes everyone equally based upon what they consume. A property tax taxes only the segment of the populace that actually owns property.
No more freeloaders on welfare, no more freeloading illegals, etc.
And I like the idea of the state controlling the disbursements. No more money-hungry Atlanta politicians denying the rest of the state an equal opportunity at a free and appropriate public eduication.
By Jen
December 3, 2007 2:12 PM | Link to this
So, Jeff, are you one of those people who ignores how renters (citizen and all forms of immigrants) actually DO pay property taxes because it’s passed on to them by their landlord through the rent?
As a homeowner I get to deduct that $6,000 a year that I pay from my income tax. A renter still pays that tax but doesn’t get to claim it. His/her landlord, who doesn’t pay that tax out of pocket, DOES get to claim it on his income taxes.
Did you say something about fair?
By decaturparent
December 3, 2007 2:31 PM | Link to this
Jeff, re “freeloaders” who don’t pay property taxes. Have you ever owned rental property? I have and I can assure you that I always worked the property taxes into the rent of my properties. To do otherwise would have put me out of business.
Before you blindly jump on Richardson’s bandwagon, you need to do the math. I mean really do the math and figure out everything including lost deductions. On our last calculation, Richardson’s plan saved us about $350 yearly. That’s it - $350, and we pay a L-O-A-D of property taxes. My guess is that his plan would actually cost the average Joe more money.
However the GREAT plan will save Richardson and Keen tons of money on their beach houses down at St. Simons!
Of course the math keeps changing because Richardson changes his plan nearly every week (a sure sign that he has no clue what he is doing).
Keep in mind that you will lose your federal deduction for property taxes. Think of all the money that will leave this state and go to the feds in the form of lost property tax deductions as a result of Richardson’s plan. Jeff, I am sure that a good bit of this federal money will go to welfare recipients and freeloaders.
I would doubt that GA would ever see a penny of that lost money. I wonder how many millions or billions would be transferred from GA to the feds? Anyone have any ideas?
Hey, but anything to make sure that the poor pay their share, right?
By JustMe
December 3, 2007 3:12 PM | Link to this
Jeff,
I also must disagree with you…..
First, everyone pays property taxes. There are no ‘free loaders’. People that rent have the property taxes rolled into their monthly rent.
Second, a ‘consumption tax’ as you put it would really penalize large families. Obviously they would ‘consume’ more food, clothes, etc. and so this tax would unfairly burden them.
Again, realize that I am single and am a property owner. This change would greatly benefit me personally. However, I feel that this change would very much hurt our education efforts in GA.
By mmm
December 3, 2007 3:13 PM | Link to this
The issue is WATER stupid! They must think WE are stupid if we give our elected officials the power distract us from their 20 year neglect of such a basic need while they play with some other toy.
He must have decided that public education was the weakest link in the forces allied against this plan.
By Tony
December 3, 2007 3:46 PM | Link to this
Consumption taxes are unfair for a number of reasons. Sales tax is the most common form of consumption tax and it is applied at (supposedly) an across the board rate. What actually happens is that poor and middle income families pay higher rates (compared to income) than upper income families. Everything in their budget is consumption of goods necessary to keep the family going. This kind of taxation is called regressive tax.
One of the ideas floated for the distribution of the taxes to pay for schools was based on the property tax digest. That translates wealthy areas would receive bigger portions of the taxes rather than a more fair distribution based on per pupil expenses. In other words, the plan would steal from the poor and give to the rich.
Local boards of education working together with the citizens of their communities should be able to enact taxation to meet the educational priorities they set for themselves. The state’s job is to assure an adequate education for all students. (I believe that is the word used in the state constitution.)
And yes, renters pay property taxes and get no deduction on their federal/state taxes.
By JustMe
December 3, 2007 4:04 PM | Link to this
Tony,
Thank you for pointing out the difference between regressive taxes and progressive taxes. However, I fear that your efforts fall on mostly deaf ears.
The ultra conservatives want regressive taxes because they do want to benefit the more wealthy. After all, repbulican is the party of and for the wealthy. It reminds me of that ‘trickle down’ theory of Reagan….. give the wealthy even more money so that maybe some of it trickles down to the poor.
By jim d
December 3, 2007 4:13 PM | Link to this
Found this funny sound byte on another blog regarding dear Mr. Richardson.
“This type of logic really hurts LSD sales. No one will pay for an illegal substance when they can get a more dramatic distortion of reality for free just by listening to this man.”
By Jeff
December 3, 2007 4:21 PM | Link to this
Ever wonder why the more liberal among us LOVE to use that word ‘regressive’??
Why, change that g to a p and you have repressive.
So a regressive tax is ASSUMED to be repressive.
When in actuality, regressive taxes are more fair for all concerned. EVERYONE pays the same tax, regardless of social standing or property ownership or any other factor. The less you consume, the less you are taxed.
This encourages conservation in ALL areas - not a bad thing.
After all, you people CLEARLY don’t have much land. I know one family here in South GA that just had a kid and makes less than T and I do, but they pay $300 PER MONTH in property taxes. How is it fair for this family to pay this much for land that has been passed down from generation to generation? (BTW: Small time farmers have it even worse, as they have even more land than the family I know.)
Which leads to another fact: A Property Tax taxes the same thing multiple times. How is this fair? How is it LEGAL??????
With a consumption tax, everything is taxed ONCE.
By JustMe
December 3, 2007 4:23 PM | Link to this
mmm
You are oh-so-right. Our wonderful politicans focus on the wrong things (changing property taxes, gay marrage, etc.) and let the basics (water, etc.) slide by.
GA should have been pro-active years ago by building additional reservours and slowing the ridiculous growth/building in the area. Even now, our politicans are handing out building permits like candy. Where will the water come from for all of these new condos and houses? We don’t have enough water for those of us that live here now!
By HB
December 3, 2007 4:56 PM | Link to this
Jeff, property tax is based on value of the property. It sounds like the family you are speaking of either isn’t able to or chooses not to use their land to reap it’s potential value. For example, could they build houses to rent out or perhaps build a commercial development of some sort? Can they farm the land? Or is it undeveloped land they they want to remain as is or can’t afford to develop? Or perhaps, no development would reap much benefit, other than selling off the land to others who want to build their own homes or own some woods. Maybe you need local laws that help lessen the burden on owners of handed-down, undeveloped property in rural areas where not much else could be done with it anyway. Or tax breaks in certain areas to help preserve privately-owned green space, so owners aren’t pressured to develop land. Perhaps small farms should get some sort of break (if they don’t already). These situations are exceptions to the rule, though, and certainly reasonable accomodations can be made short of eliminating all property tax state-wide.
By JustMe
December 3, 2007 5:36 PM | Link to this
Jeff -
LOL!!! Do you honestly think that ‘liberals’ came up with the terms regressive and progressive? Think again! These terms are accounting terms that have been around forever.
Please don’t tell me that you are one of those ultra-conservatives that believes that anything you disagree with must be ‘liberal’!!!
A history lesson….. when the tax laws first came into being, even the biggest dolt around understood that poor people cannot pay as much as wealthy people. Thus was born the progressive tax system. It is/was a sliding scale that allowed those that can afford to pay more to do so.
For example, in your ‘world’ of regressive taxes, lets say that everyone pays 20% tax on their income (via income tax, property tax, sales tax, whatever). This means that someone that earns $20,000 will only have $16,000 to live on, while someone earning $200,000 will still have $160,000 to live on. That 20% per year is much more critical to that poor person than to that wealthy person. How is this fair? You will force the person making only $20,000 to go on welfare (something I am sure that you don’t like since you seem to be an ultra conservative) or worse, forcing them into crime just to make ends meet. The person making $200,000 per year can still live rather comfortably because they still have $160,000 to spend after taxes.
People that are in favor of a ‘flat’ tax (sales, income, whatever) have been sold a bill of goods. This flat tax will inevitable hurt the lower middle and lower income people at the expensive of the wealthy.
The ONLY reason I would CONSIDER such a thing is that it would finally stop all of the out-of-hand loop holes used by the wealthy to get out of paying their fair share of taxes!
With respect for your concern about the property of said South GA family. You pay taxes on what the property is worth in GA. That is our State law. Other States have different laws. For example, CA property tax (at least in the San Francisco area) is fixed at the time of ownership. In other words, if you buy property, the property tax is frozen at the time of purchase until the deed changes hands (it is sold or the property is inherited). They did this because the property taxes were increasing too fast and they had to do something to keep home ownership.
By catlady
December 3, 2007 6:02 PM | Link to this
From what I have seen , the only thing that actually trickles down is (urine).
Everyone who is alive pays property tax in one form or another, except maybe churches, cemetaries, and those rich enough to hire someone to come up with a tax dodge (See S. Purdue). The elderly get an exemption from the school part of property tax, as I understand. Like it? No. But willing to do it? Yes, because I don’t want to have to pave my own roads, own my own dump, etc. And it behooves me to help children get an education so they can support me with their taxes and SS payments in a few years.
By SET
December 4, 2007 12:32 AM | Link to this
Property Taxes have traditionally financed local schools. Along with paying the higher tax, the better neighborhoods had better schools, with higher property values to go along with it.
Since the local schools are effectively being nationalized and dumbed down the local taxpayers have less incentive to pay for schools. It seems to me that the primary and secondary schools are now in competition with the public community colleges for Voter Money.
In CA except for small independent exclusive areas - everybody who counts goes to private primary/secondary schools (often Catholic or church schools). All this has happened during my lifetime. Instead of campaigning and voting for school measures like years ago, most of my friends loudly vote against public primary/secondary school measures because they no longer see the connection between proletariat schools and property values.
CA Public schools only exist for the proletariat (I wish this weren’t true) and therefore there is little incentive for the homeowning class to support them.
Jr Colleges also ask the voters to vote tax increases (bond measures) and voters here are much more interested in supporting them. The Jr Colleges are where you get all your non-professional employees - HS grads are not desired in the workforce it seems. Everybody knows people who finished at Jr College. Voters hire & work with them and sees them whenever you go to a hospital, an auto mechanic or have police/fire contact.
The Jr Colleges, with non-compulsory attendence & still being able to enforce deportment and discipline - seem to have taken the places the high schools once had in the local society. They have prerequisites and grad/certificate requirements, they flunk people, and their graduates have some standards of competence.
Brave New World.
By JustMe
December 4, 2007 8:02 AM | Link to this
SET -
What is happening in CA is indeed interesting. However, please keep in mind that it is not what is happening elsewhere (like in GA).
By WFC
December 4, 2007 8:59 AM | Link to this
The gradual change from property taxes to other forms of taxation could be accomplished in a progressive manner. A few modest proposals:
No sales tax on food, medicines or medical care.
No property tax on homes valued at $200,000 or less. Keep property tax on the value above $200,00. I would have to pay on about $50,000.
Abolish ad valorem tax on autos valued at under 25,000. Keep ad valorem on amounts above that. Increase the sales tax on all auto sales including private transactions. My Mercedes is getting old now but I would have paid this tax in the early years of ownership.
Require landlords to pass along tax savings to renters.
Institute a modest ($100 per year) “tuition” for each child in public school. People like me who have children in school should pay a little more for education.
Abolish the property tax on undeveloped “inherited” land. However, tax the hell out of it when the family sells it to developers and receive windfall profits. That has happened a lot in the north Atlanta burbs wher I live.
Revise the notion of a “luxury tax.” Abolish the FET tax on tires which were once luxury items but are now necessities. Tax at 10% purchases of 60” plasma HD televisions and tax at 2% TV’s bought at Wal-Mart for $200.
Tax the hell out of luxuries such as jewelry and designer clothes.
Tax “luxury services”… lawyers, CPA’s, lawn maintenance and landscaping services.
Not going to happen.
By Jeff
December 4, 2007 9:48 AM | Link to this
WFC:
Now THAT is a taxation approach that I could support! It still taxes the rich unfairly, but at least you’re making strides to eliminate loop holes that whole PLANETS have been known to pass through…
By SET
December 4, 2007 9:59 AM | Link to this
Jut Me: Hi - I know the left coast is probably very different from yours - for now. My point is that your educational issues and problems don’t exist in a vacumn.
Education has already been nationalized, at least at the primary & secondary level. CA is a bellweather state for this and the complaints I read from your people indicate that your state is being moved into what our state has already become. And that’s not a good thing.
I don’t think Georgians perceive this yet. But what has happened here is coming to you. What our people have done to adjust is what your people are going ot be doing in the forseeable future. It’s annoying I’m sure to hear my comments but that’s how it goes on a blog with national ambition.
I wish GA never allows the educational problems we have in CA to visit you. When you are told how progressive CA is and you should submit to changes to make you like us, remember my posts and ask a lot of questions.
BNW!!
By JustMe
December 4, 2007 11:39 AM | Link to this
WFC -
I mostly agree with your recommendations. However, I also agree that it’s not going to happen. Right now, the wealthy enjoy large loop holes and your proposal would mostly eliminate them, so they will not allow it to happen.
By Lee
December 4, 2007 9:08 PM | Link to this
Once again, most people are addressing the symptom rather than the problem.
The excessive tax burden most Americans are bogged down with is merely the symptom. The problem is out of control spending….. at ALL levels of government.
Several years ago, my hometown buit a new high school. They abandoned the old high school and eventually sold it for pennies on the dollar. For our $25 million, I think we gained about 10 classrooms.
They didn’t skimp on the athletic facilities though. New stadium, track, baseball fields, tennis courts, practice fields, fieldhouses, a weight room that would make an olympian proud. You name it. They built it.
For what they spent on athletics, they could have renovated the old high school and doubled their capacity. But nooooo. The athletic booster club flooding the school board meetings for a couple of months in a row took care of that.
But yet, they hire a new teacher who walks into a “scavenged” classroom. They cannot even provide the basic essentials in a classroom. New teachers have to depend on hand-me-downs from her co-workers.
Over the years, I cannot begin to estimate the things that my wife brought home for me to fix. Things that the school was going to throw away. Overhead projectors that only had a blown fuse. Desks that only needed a screw in the leg. Etc, etc.
Like it or not, SET is correct about CA being a bellweather state. There may be a 10-20 year lag, but it eventually makes it way here. (Illegal immigration, anyone?)