Less than three months after rejecting a property tax increase to help balance Fulton County’s budget, officials have revived the idea.
County Commission Chairman John Eaves this week floated a plan for a new tax levy to support either Grady Memorial Hospital or county libraries. Though Eaves hasn’t endorsed the idea, it’s one option he and other senior county officials are considering as they try to close a projected deficit in Fulton’s 2014 budget of $74 million.
Eaves told The Atlanta Journal-Constitution this week that a separate tax levy for either Grady or libraries would create a new revenue stream to protect one of those key services while freeing up cash for other programs that face steep cuts, such as senior services and arts funding.
“Right now I’m open to various options to make sure that services that our citizens want are protected,” Eaves said.
But a tax increase likely would infuriate Republican state lawmakers, who say a new state law prohibits Fulton from raising taxes.
“I don’t believe they can do it legally, based on what we passed,” said Rep. Ed Lindsey, R-Atlanta, the House majority whip. “If they try, we’ll take appropriate measures in the coming session.”
Critics have long said Fulton County spends too much. That belief led Republicans in the General Assembly to pass a flurry of bills affecting county operations earlier this year. One new law prohibits county commissioners from raising the property tax rate until January 2015 and requires a supermajority of commissioners to raise taxes thereafter.
Fulton’s Democratic-majority County Commission has dismissed claims the county budget is bloated. They say they’ve cut spending and haven’t raised the countywide property tax rate since 1991.
In July, commissioners considered a plan to create a new tax levy to cover Fulton’s $50 million annual contribution to Grady. The payment currently comes from Fulton’s $536 million general fund budget, which pays for countywide services such as libraries, courts and elections.
That plan would have cost the owner of a $200,000 home an extra $75 a year. But commissioners rejected the proposal, saying it would be a bad idea to raise taxes with the economy still sputtering.
It’s unclear whether commissioners have changed their minds. Commissioner Bill Edwards was noncommittal when asked about a tax increase Thursday.
“It’s a conversation,” Edwards said.
Eaves and senior county administrators won’t release a proposed budget until next month. Commissioners would have to give preliminary approval to a tax increase before the end of the year.
Initial projections indicated the county would face a $114 million deficit in 2014 — about 22 percent of projected revenue. Eaves said the projected deficit has shrunk to about $74 million because of belt-tightening the county has undertaken this year.
He said the county has identified an additional $54 million in cuts to various county programs, though he did not release specifics. But those cuts wouldn’t completely close the budget gap.
Eaves said a separate levy for the hospital or libraries would free up money in the general fund and ease the need for steeper cuts.
Lindsey said steep cuts are exactly what’s needed. He said Fulton should turn a host of social services over to cities and reduce its tax rate.
“What they need to do is cut back on those services that are more appropriately handled by local governments,” he said.
Lindsey said a tax increase would spark additional legislative efforts to rein in county spending. One option: doubling Fulton’s property tax homestead exemption to $60,000 — a move Democrats say would cost the county $48 million and decimate popular programs. The homestead exemption proposal passed the state House of Representatives last year and is still pending in the Senate.
About the Author
