Lawmakers look at flaws in property tax system

By D.L. Bennett

The Atlanta Journal-Constitution

Georgia's much maligned property tax system took another beating Thursday as legislators began looking at how to reform it when the General Assembly meets in January.

Members of a Senate study committee on tax reform heard from property owners, tax consultants, tax officials and lawyers during more than three hours of testimony at the Capitol. Legislative leaders say tax reform will be a major issue in 2010.

The one thing everyone agreed on Thursday: the property tax system has flaws that should be addressed.

The only question is how far to take it.

Senate Majority Leader Chip Rogers, who's chairing the committee, was clear.

"We ought to scrap the whole system and just move forward," the Woodstock Republican said. "It's unfair."

Rogers complained it's complicated, difficult to understand and produces inaccurate values. He said lawmakers get more complaints about assessments and property taxes than any other single issue.

"Whether its real or imagined, property owners I talk to feel they are getting (unfairly treated)," Rogers said.

He found support from Joseph Robert of Woodstock put a human face on issues with the tax system. He said Cherokee County last year bumped up the appraisal on his auto repair shop by almost $100,000 or about a third, even though he saw business drop off dramatically. He said his value was lowered by only $6,000 this year even though business is worse and values down.

"I just do not think the tax system is fair," Robert said. "It's not right. I've got every vehicle at the shop for sale. I can't pay this bill."

Robert said the entire system is fundamentally flawed because no county can truly accurately value all parcels as they are required to under Georgia law.

"I just don't think it's possible," he said.

R.J. Morris, a real estate investor, said values are hopelessly screwy in many jurisdictions. He provided examples in a working-class south Fulton community where 2009 tax values were much higher than 2008 sales of the same properties. His numbers also showed the reverse was true in wealthy Buckhead.

Property owners, he said, can't hope for those flaws to be fixed by appealing.

"The boards of equalization can't wrap fish," Morris said. "I'm sorry. But that's the truth."

Most of the lawyers, tax officials and consultants who are all part of the current system agreed the system should be changed. But they pushed for tweaks and adjustments rather than a complete overhaul. Depending on how the system gets overhauled, the entire professional subculture created around the annual setting and contesting of values could be wiped out.

Wheeler Bryan, a lawyer who specializes in tax work, put forth a list of 15 proposed reforms. His list included everything from update the rules for appeals hearings and the boards of equalization members who hear them to improving  the little-used arbitration system.

"The Boards of Equalization say they are independent of the Boards of Assessors. That's questionable sometimes," Bryan said.

He also warned the lawmakers that just because they pass reforms that doesn't mean counties follow them.

Two reforms passed last year weren't always followed. One reform required counties to consider foreclosure sales in setting values this year. The other reform created a system of binding arbitration in appeals.

Shane Masters said DeKalb County has flat out ignored the requirement to respond to his arbitration request, even though the deadline passed 90 days ago. The law, he noted, has no penalty for the government if it fails to act.

Rogers, who wrote the arbitration bill, already had a fix in mind for Masters.

"If the county doesn't respond to the value put forth by the homeowner," Rogers said, "then the homeowner's value should stand."