No tax relief grants, Perdue hints

Gov. Sonny Perdue gave county commissioners every indication Tuesday that they shouldn’t count on getting the $428 million they need to pay for last fall’s homeowners’ relief grants.

If counties don’t get the money, officials say they’ll have to send supplemental $200 to $300 property tax bills to homeowners later this year. They’ll essentially be asking homeowners to give the tax relief grant money back.

Perdue told county commissioners the state can’t spare the money at a time when its budget shortfall is $2.2 billion and rising.

“To this day, we don’t have any satisfactory answers about where that $428 million will come from,” Perdue told officials attending an Association County Commissioners of Georgia conference. “There is not $428 million to spare in the budget I submitted.”

The governor’s remarks came two hours after the Senate gave final approval to a bill that would commit the state to covering the $428 million that counties doled out in homeowner relief grants last fall. The annual grants —- meant to lower property taxes by $200 to $300 —- were initially approved before counties knew the program was threatened.

Perdue would have to sign the bill for it to become law. In addition, lawmakers would have to put the money in the budget, and Perdue would have to sign off on that.

Perdue didn’t say what he would do, but he told the commissioners that the tax relief program has been a failure. He said local government revenue has grown three times faster than state tax collections since 2001. And he said that counties, as a percentage of their annual budget, have much bigger financial reserves than the state.

“In budget times like these, from a state’s perspective, I don’t know how we can continue programs that I don’t think have been effective in their ultimate mission,” Perdue said.

Oconee County Commission Chairman Melvin Davis said if the state doesn’t come up with the money, counties will have no choice but to bill homeowners.

“It will be a shock to homeowners,” he said. “They are going to be mad as heck.”

House Appropriations Chairman Ben Harbin (R-Evans) vowed lawmakers would find the money. Then the decision will be up to Perdue.

“We are going to cut everything else to the core, but we are going to keep our commitment to the taxpayers of this state,” Harbin said.

If Perdue vetoes the bill or funding, Harbin said, “I am very comfortable the House will have the guts to override his veto.”

The Senate has been reluctant to go along with the House in the past when it attempted to override the governor’s decisions. Two weeks ago the House voted to use a parliamentary maneuver to force Perdue to act quickly on the homeowner relief bill, but the Senate declined to join the effort.

“We’d rather work this out together as opposed to start any type of friction between the House and the Senate and the governor,” said Senate Majority Leader Chip Rogers (R-Woodstock).

Finding the $428 million is about to get a lot tougher.

Perdue told county officials and reporters that he may lower the state revenue estimate because tax collections continue to fall.

This year’s estimate has already been reduced $2.2 billion, forcing spending cuts of 10 percent or more in many state agencies. After seeing a 14.3 percent dip in tax collections in January, lawmakers are bracing for even leaner times. Some legislators predicted new reductions of about $600 million this year and twice as much in fiscal 2010, which begins July 1.

Perdue said he worries that saving the homeowner tax relief grant will mean damaging the state’s education, health care and public safety programs.

“We’re still looking (for money),” he said. “But these are tough times to find that kind of money.”