DEL.ICIO.USUpdated: 6:41 p.m. November 24, 2008
Senate leaders back effort to limit tax assessments
The Atlanta Journal-Constitution
Monday, November 24, 2008
Georgia House and Senate leaders are now throwing support behind a plan to cap home assessment increases in hopes of holding down property taxes.
The proposal is being called a top priority for the 2009 legislative session, which starts Jan. 12.
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Relief for homeowners, however, could be a long way away. The cap, if passed by the Legislature, would have to be voted on by Georgians in November 2010. And property values are dropping now in some areas because of the housing crisis, so caps might not come into play for some time.
Meanwhile, taxes may end up increasing next year if the same Republican leaders promoting the cap follow Gov. Sonny Perdue’s lead and eliminate a state property tax grant program worth about $200 to $300 to most homeowners.
Rep. Rob Teilhet (D-Smyrna), said politics is behind the Republican push for the assessment cap.
“They (Republicans) are giving themselves cover to raise property taxes,” he said.
Republicans leaders say that’s not so, and they note that each GOP-led chamber approved similar measures during the 2008 session. It ultimately failed in a last-day tax cut fight between House Speaker Glenn Richardson (R-Hiram) and Lt. Gov. Casey Cagle, the Senate’s president.
Senate Majority Leader Chip Rogers (R-Woodstock), said Monday that something needs to be done to slow property tax increases.
“Property owners in Georgia deserve predictability in their property tax bill,” Rogers said. “It is senseless that a homeowner can be sacked with a 50 percent increase in property taxes just because a government bureaucrat claims the home value has increased on paper.
“This is unfair and it must be addressed.”
While legislative leaders have pushed tax reform in recent years, lawmakers head into the 2009 session facing a $1.6 billion to $1.8 billion budget shortfall. That will make it very difficult for them to cut state taxes.
Perdue has put the homeowner relief grant program on hold because of the budget crisis. Lawmakers from both parties say they want to fund it this fiscal year, which runs through June 30, to avoid additional property tax bills being sent out this spring. But they aren’t sure about it next year.
Richardson in particular has been on the warpath against property taxes for years. In 2007 he touted a plan to eliminate all property taxes. When it went nowhere, he backed bills to eliminate property taxes on cars and to freeze assessments.
Those died on the last night of the session.
Two new resolutions to freeze or limit home assessment increases have already been filed for the upcoming General Assembly session.
Rep. Edward Lindsey (R-Atlanta) filed a proposal backed by Richardson and House Majority Leader Jerry Keen (R-St. Simons Island) to cap possible property assessment increases at 3 percent or the rate of inflation.
Rep. Kevin Levitas (D-Atlanta) filed a bill to freeze assessments at the price the homeowner paid for their home.
If a cap passes, it would go before voters in 2010.
The value of a piece of property and the tax rate are components that determine how much a homeowner pays in property taxes. Often, lawmakers say, cities, counties and school districts have held down tax rates but brought in more money each year through increases in the value of properties.
According to state Department of Revenue figures, local government revenue from sales and property taxes jumped to $1,519 per capita in fiscal 2008 from $1,094 in fiscal 2000. State revenue from those sources increased during that period from $601 to $625 per capita.
However, the numbers don’t include what the state gets from income taxes, a major source of revenue. And other studies have shown a smaller gap between the growth in local and state spending.
Proponents of the cap say it would force city, county and school officials to vote on tax increases, a politically unpopular move.
Slowing the flow of revenue could make it tough on some cities that are already facing layoffs and service cuts because of budget problems, such as Atlanta.
Carrollton Mayor Wayne Garner, a former state senator, said, “It would impact their ability to raise revenue. It would be tough on Atlanta.”
But unlike some mayors, Garner, a statehouse lobbyist, doesn’t think the cap is such a bad idea.
“At some point in time, there has got to be some kind of circuit-breaker to stop local governments from growing and growing and growing,” he said.
Gwin Hall of the Georgia Municipal Association said her group thinks local officials should be the ones deciding whether to cap assessments. Some local governments have limits similar to those included in the House proposals.
Hall said there could be a myriad of problems with a statewide cap on assessments. For instance, the legislation would likely allow higher assessments when property changes hands. So people buying homes or businesses would have higher assessments than their neighbors.
Hall said Georgia cities have about $14 billion in capital improvement needs - from roads to sewer projects - over the next five years.
The idea behind the assessment caps, she said, “is to limit the amount of revenue” local governments take in.
“It’s going to make it that much harder to pay for those critical infrastructure needs,” Hall said.
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Comments
By Gerry
Nov 25, 2008 8:14 AM | Link to this
We pay more taxes to support educational and medical benefits for illegal aliens living in our communties.
Each child of an illegal alien attending school costs local taxpayers $10,000/year.
Gwinnett County has 30,000 such children, ccosting taxpayers, $300 MILLION each YEAR!
By Al
Nov 25, 2008 5:30 AM | Link to this
Perdue got his tax brake retroactive, in the middle of the night with no discussion, why is it so hard to give taxpayers a brake, after funding a 20 mil fishing tournament, spend it boys, push this thing over the edge, in the lake.
By Craig Spinks /Evans
Nov 25, 2008 3:39 AM | Link to this
Does anybody still believe that wasteful governmental bureaucracy in the U.S. exists only at the federal level?
By The Truth
Nov 24, 2008 10:32 PM | Link to this
Capping assessments is regressive taxation and will only serve to shift the burden from the upper class to the middle to lower class. ALWAYS, follow the money. If commercial properties, the only properties that are actually still increasing in value, are included in this cap, their tax burden will shift to the homeowners. Follow the money. Assessment caps will not reduce taxes, only shift the amount that is being paid from the faster appreciating, more affluent areas to slower appreciating, less affluent areas, class regressive taxation.
Perhaps, the Legislature ought to be concerned about balancing the budget instead of meddling in what is a local concern. Again, follow the money.....
By Pittjacket
Nov 24, 2008 8:48 PM | Link to this
I have a lot more trouble paying high state and federal taxes than local taxes, where we actually get what we pay for. Limiting local government taxes handcuffs the officials who provide our most important services (roads, police, parks & recreation, code enforcement, fire). Sure the property tax is less fair than other taxes, but it is mighty stable, an excellent attribute when it comes to funding our most valuable services.
And doesn't it seem a bit disingenuous for state level politicians to question local government elected officials? I say we keep the decision making local.
By jerry
Nov 24, 2008 6:17 PM | Link to this
Freezing property values is a dumb idea. It was dumb in California when they did it in the late 1970s and now they can't get rid of it. Freezing values doesn't lower the cost of government it just changes who is going to pay for it. In this case, it's the new owner. If we really want to lower property taxes we have to either (a) find another revenue source or (b) actually lower the cost of government. Since no one wants to reduce the amount of money going to pay for schools, police and fire protection, the only rational choice is to find another source of funds - maybe a City of Atlanta income tax. That would bring in revenue from the commuters that benefit from downtown jobs but don't currently pay for the government services that go along with those jobs. Unfortunately, freezing property values has become politically popular and an uninformed public will likely be swayed by the rhetoric.
By Winfield J. Abbe
Nov 24, 2008 6:03 PM | Link to this
Does anybody remember the American Revolution over 2 centuries ago? The basic reason for it was unfair taxation.
Yet today the most unfair tax is the property tax. Many owners, who do not even live in the area or operate businesses which cannot even vote, are forced to pay for government services, education, hospitals, police, judical, jails, etc., for others many of whom pay nothing at all for those services. The best our lawmakers could do was copy the dictum of Karl Marx "From each according to his ability, to each according to his need." We all know why this happened: You can't get blood out of a turnip. You can't make indigent people who have nothing pay their fair share, so you misuse the law to take money from the haves under the threat of confiscation of their property if they refuse to pay. It is difficult to find polite words in the English language to describe all this. Thank you lawmakers in both political parties, Republicrats and Demopublicans for such original thinking during the past 2+ centuries.
Winfield J. Abbe, PH.D., Physics
Athens, GA
By jess
Nov 24, 2008 4:59 PM | Link to this
Outrageous property tax increases ($840 in 1972 to $8,722 in 1994 with no increase in property or additions to the structure)drove us out of the City of Atlanta (saw a street sweeper twice in 22 years and a cop only when called, never on patrol, and rolled our garbage to the curb). Now living in exile in Cobb county. Hate it !! Hate it !! Hate it!!
By Harrington Witherspoon
Nov 24, 2008 4:56 PM | Link to this
The problem for Atlanta city residents is the Atlanta Board of Education with sneeks a Billion Dollar sales tax increase using only 3,000 votes while they have $100 million in their surplus account. They are accountable only to themselves.
By Kitty
Nov 24, 2008 4:40 PM | Link to this
Dear Midtowner,
If you prize your living area and community as much as I think you do, you would welcome the Beltline. If you are so lucky as to live long enough to see the Beltline running, you would realize that the condo you purchased in Midtown is going to be the diamond you think it is right now. That condo, no matter How costly/valuable you think it is right now will pale in comparison to the values expected after the BL is built. Mark my words, you own a semi-precious condo now; years from now with the Beltline it will be a Real gem!
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