Clayton County is considering a 34-percent property tax increase that some officials say will overburden one of metro Atlanta’s poorest counties and drive residents away, claims that others dispute.
Regardless, assessed values of homes, business and real property in Clayton fell by more than $1 billion in the past year, which was compounded by a record 8,700 property tax appeals estimated to set the county back at least $5 million. The county is looking at a deficit between $20 million and $30 million if it doesn’t balance its budget.
Late last month, county commissioners hurriedly adopted a $167 million fiscal 2012 budget, but not before agreeing to seek a five-mill increase that will be put to a vote Tuesday night after two public hearings. If passed, this will be Clayton’s first property tax hike since 2009.
“It was a very tough decision we had to make,” Commissioner Sonna Singleton said of the board choosing to raise taxes, plus scrap 14-day furloughs proposed for county workers. “It would have been irresponsible to shut down the county for 14 days. Long term, we felt it would not be as big a strain to ask for an additional $4 to $5 a month, and that’s what raising the mill will do. “
Similar to other metro Atlanta counties, Clayton is struggling to figure out how to operate when its traditional source of revenue has withered. Running a government and providing all necessary services are even tougher for a county in which the average home is worth $80,000 and more than half of the budget pays for police, fire and other public safety services.
Among other metro Atlanta counties faced with higher property taxes, Cobb will vote Tuesday night on whether to accept a 16.8-percent increase, seeking its first tax hike in five years, and DeKalb previously approved a 26-percent increase. Fulton decided against raising property taxes, while Gwinnett may do the same.
Clayton’s budgetary problem has fractured the five-member county commission, setting off a flurry of finger-pointing. Residents have criticized county officials for raising their taxes while trying to hire a county manager for a $150,000 job annually that was created earlier this month.
“This is carried out on the small man’s back,” Jonesboro resident Evelyn Starks said last week at a public hearing on the proposed tax increase. “I’m paying as much property tax as friends in Cobb and Gwinnett, and they have more jobs and businesses and better schools.”
The county’s top tax official accused the county of ramming through “a very high tax bill” because officials didn’t go far enough in cutting spending. Some homeowners with escrow accounts will end up paying higher mortgages, Clayton Tax Commissioner Terry Baskin said.
Baskin fears a tax hike could drive more tax-paying residents out of the county. He said the county could fix its deficit by shelving several recreational centers and other special purpose local option sales tax projects, using proceeds from the recent sale of Tara Field and postponing hiring the county manager.
“The majority of Clayton residents are going to be hit real hard with a tax bill that’s not reflective of the [true] value of their homes and that’s going to likely lead to a deluge of appeals in 2012,” said Baskin who lives in Clayton. Baskin, who didn’t appeal his bill, said approving the increase will add $275 per year more to his tax bill.
Here’s another take: Even with a tax hike, many Clayton residents aren’t going to have higher taxes.
“There are a number of property owners who actually won’t see an increase in their bill when compared to last year’s bill because property values are down so much,” chief appraiser Rodney McDaniel said. In fact, many homeowners are paying fewer taxes now than they did in 2009, he said.
While most Clayton properties haveexperienced a drop in value, more stable neighborhoods will have the biggest tax hike because they’ve not undergone dramatic swings in value during the past two years, McDaniel said.
Commission Chairman Eldrin Bell said he plans to offer a last-minute, multi-million-dollar solution in addition to Tuesday night’s tax hike vote.
“I’m exploring the possibility, along with Mr. Edmondson, of looking at a number of vacancies we’ve had with an eye on defunding them; we won’t do away with them ... we’ll keep the positions in place,” Bell said, referring to Commissioner Michael Edmondson.
Bell said that move would create an immediate savings of $3 million to $4 million. Bell and Edmondson oppose the five-mill hike as a way to deal with the budget crunch.Bell originally proposed a 3-mill increase. (A mill equals $1 for every $1,000 of assessed value of a property.)
Commissioner Wole Ralph noted that the board received the proposed budget from Bell two weeks before a budget officially had to be approved in June, which he said was hardly enough time to take proper action.
“With less than two weeks, it’s very difficult to turn around a large structural deficit,” Ralph said. “Quite frankly, that’s part of the reason why I believe we need a professional administrator.”
He also disputed claims that residents will leave the county if they have to pay more taxes.
“What will cause people to flee the county is if they don’t have police officers, firefighters and ambulance service, and this is what most of the budget is all about,” Ralph said.
CLAYTON PROPERTY TAX
Despite a pending property tax hike, many Clayton homeowners aren’t likely to see much, if any, of a jump in their tax bill because overall property values in the county have dropped, Clayton’s chief appraiser Rodney McDaniel said. Stable neighborhoods -- those that have had a slight drop in home values -- could see higher taxes. Neighborhoods that have seen a big drop in home values and a flurry of appeals, however, won’t. Here are three examples of how Tuesday night’s tax hike could impact homeowners:
Drastic tax drop: A property in Morrow valued at $126,000 had a tax bill of $1,290 in 2009, the last time property taxes increased. That same property is now looking at a 2011 tax bill of $417 on a home worth $51,000 today.
Little change: A Jonesboro homeowner whose home was valued at $112,600 in 2009 paid $1,600 in property taxes. Today, that same home is worth $92,230 in a neighborhood where home values have dropped slightly. The estimated 2011 tax bill: just under $1,400.
Tax hike: A home in the posh Lake Spivey area worth $816,000 in 2009 had a tax bill of $11,300. Today, that home is worth $745,700. The homeowner can expect taxes to go up $300 to $11,600.
HOW WE GOT HERE
With metro Atlanta still in recession recovery, county governments throughout the region have had to make tough budgetary decisions, and we’ve been there to provide the latest and most in-depth coverage.
Visit our website Tuesday night to read about Clayton and Cobb county votes involving significant property tax increases, and return to Wednesday’s edition of the AJC for continuing coverage.
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