Big county projects hint at property tax hike in Fulton

Commissioners met with top county staff for a planning session on taxes and spending in anticipation of the next year’s budget. The jail was at the top of the agenda.

Until now the county’s largest capital project has been the ongoing expansion of the Big Creek Water Reclamation Facility, at roughly $300 million. But a new and larger jail could cost almost seven times that — and will also require keeping the existing Rice Street jail functioning until the new one is ready in 2029, under the proposed timeline.

The 34-year-old Rice Street jail was designed to hold 1,125 inmates, but now houses close to 3,000. Consultants recommend a new jail with 5,480 beds, but with far more room for mental and physical health care, education and reentry programs. Altogether it would be four times the size of the current jail.

There was some talk of scaling back the new jail or building it in phases to cut the up-front cost.

Commissioner Bob Ellis said he wouldn’t object to that, since even a decade of leasing space elsewhere would likely be less than building the full jail as proposed.

Chief Financial Officer Sharon Whitmore said county property tax rates fell in 2022 but are projected to rise for 2023 taxes. Rising property values allowed revenue to increase even as the rate dropped, upping the county’s fund balance from $130 million to $224 million in that same period, she said.

But staff projections for various spending plans — including health care funding, employee raises and other items — could nearly double current millage rate over several years, she said.

That had staff and commissioners alike looking for alternative funding sources to keep the property tax rate down.

The most straightforward idea is an additional one-cent sales tax, which would generate $1.7 billion over its five-year life. But that would require both approval from the General Assembly and a countywide referendum.

Issuing bonds for the jail project would require a separate property tax, but would take the project out of the county’s general fund, Whitmore said. That would also require a referendum.

The next biggest issue was health care. The county is renegotiating its agreement with Grady Memorial Hospital, which it heavily subsidizes; and there are several efforts underway to compensate for Wellstar Health Systems’ closure last year of two hospitals that served Atlanta and the southern end of the county.

One proposal aired Monday would spend $93 million a year on health care. That’s not just for Grady but to potentially support another hospital or several clinics to serve the former Wellstar area. But other projections would cut that to $40 million.

The county already has three hospital authorities in existence, providing “one ready source of statutory authority for funding,” County Attorney Y. Soo Jo said. Only one of those, which supports Grady, gets any county money, she said.

The county can levy a property tax of up to 7 mills to fund a hospital authority, but does not impose that tax now, Jo said. It can do so without a referendum.

“That’s the one I like,” Chairman Robb Pitts said, noting that funding a hospital authority through that tax mechanism would only require a majority vote on county commission.

One initiative to fill the health care gap is a clinic that will be opened by Morehouse School of Medicine. Initial estimates for the needed contribution from the county ran to $5 million, but that has been revised down to about $3.1 million in the next years, said Pamela Roshell, county chief operating officer for Health, Human Services & Public Works. After that, the county will need to contribute about $1.9 million for annual operating expenses, with that dropping in succeeding years, she said.