Tax ruling gives Fulton weapon in fight with Legislature

A judge recently ruled in favor of the County Commission in a tax dispute, saying commissioners were within their constitutional rights to repeal a property tax cap imposed by the Legislature. That repeal paved the way for a recent 17 percent property tax increase that critics say is illegal.

Now Chairman John Eaves says a commission dominated by Democrats may repeal other measures likely to come from Republican lawmakers in the General Assembly, who have used so-called local legislation to remake the county more to their liking.

“We’re open to it,” Eaves said last week. “It is something we can utilize as part of our defense going forward, especially if we feel the Legislature goes after us in a punitive, personal way.”

Six current and former Republican lawmakers who sued the county may appeal the judge’s decision. They say the recent property tax increase violates the tax cap, and they don’t think commissioners had the authority to repeal it.

“This is one the (state) Supreme Court needs to decide,” said Josh Belinfante, the lawmakers’ attorney. “That way we can remove whatever uncertainty there is.”

The judge’s ruling is a rare victory for the county in its ongoing tussle with the General Assembly.

Critics — many of them north Fulton Republicans — have long said Fulton spends too much. They want the county to cut spending and turn some services over to the city governments that have proliferated over the last decade.

Fulton officials say they have cut spending and — until this year — didn’t raise countywide property tax rates for 23 years. They say the tax hike is needed to protect funding for Grady Memorial Hospital, libraries, senior programs and other popular services.

The Democrats who control county government have long had an upper hand in the debate. But that changed last year after Republicans gained control of the Fulton County delegation to the General Assembly through redistricting. The delegation has the authority to propose “local legislation” — laws that apply only to specific local jurisdictions.

Local legislation often is developed by consensus. County leaders go to their county legislative delegation and work out non-controversial measures such as re-codifying arcane municipal codes.

But last year Republicans used that power to pass a slew of laws affecting Fulton County operations, without the support of the commission and over the objections of Fulton Democrats in the General Assembly. For starters, they redrew County Commission districts to give north Fulton residents — and Republicans — a greater say in Fulton affairs. Among other things, they also made it easier to fire county employees and prohibited commissioners from raising the property tax rate until 2015.

County commissioners fought back, voting last year to repeal the tax cap. This summer they followed up by approving the 17 percent property tax increase. That prompted two lawsuits claiming the property tax hike violated the state law.

In repealing the tax cap, commissioners cited their home rule authority under the Georgia Constitution. Home rule gives local governments broad powers over their own affairs.

Specifically, the state constitution gives counties the power to amend or repeal local legislation with just a few exceptions, like laws affecting their own election and pay. In court documents, the county argued the tax cap did not fall into any of the listed exceptions.

The state lawmakers argued commissioners didn’t have the authority to repeal the tax cap because it was based on a 1951 constitutional amendment that applies only to Fulton County. That amendment gave the General Assembly authority to determine the “date and time” when commissioners can set a tax levy.

In court documents, the lawmakers argued they had done just that by telling commissioners they couldn’t raise taxes until 2015. They said the commissioners’ vote to repeal the tax cap amounted to an improper attempt to amend the constitution.

Fulton officials argued the tax cap is illegal because it went far beyond merely telling commissioners when they could set the levy. They said it essentially dictated the tax rate – something they argued only the commissioners had the authority to set.

In a Sept. 27 order, Cobb County Superior Court Senior Judge G. Grant Brantley sided with the county. He didn’t directly address whether the tax cap was legal. But he ruled commissioners were within their authority to repeal it.

Because they repealed it, the tax cap was not in effect when commissioners raised the tax rate in August, Brantley concluded. He also said the lawmakers “have not shown substantial likelihood that they will prevail at trial.”

With their authority to repeal local legislation affirmed, commissioners could repeal other local legislation. One possible target: North Fulton Republicans have discussed reviving a proposal to double the county’s property tax homestead exemption to $60,000.

That would mean the owners of homes worth up to $150,000 would pay no county property taxes, and thousands of others would get sizable tax breaks. Fulton officials say the tax break would decimate revenue for popular services. Supporters say it’s needed to force Fulton to scale back spending.

The proposal passed the state House of Representatives in 2013 but died in the Senate this year. State Rep. Jan Jones, R-Milton, has said she will revive it next year.

That suggests Fulton County could see a series of tit-for-tat votes, in which legislators pass laws affecting the county and commissioners vote to repeal them.

In the meantime, the legal battle over the tax increase will continue.

“I have confidence in the validity of our lawsuit,” Jones said. “Fulton County acted without regard for the taxpayers or state law. I expect we will prevail in the end.”