Defying state lawmakers bent on reshaping Fulton County government, county commissioners Wednesday spurned a state law to cap county property taxes for the next two years, then unveiled a proposed tax hike.
They proposed a new levy to cover Fulton’s contribution to Grady Hospital. The proposal would cost the owner of a $200,000 house an extra $75 a year. Though Fulton’s general fund tax rate would decline slightly, the result would be a net tax increase of 1.49 mills if commissioners approve the new tax rates next month.
It's unclear whether the proposed tax hike would violate provisions of the tax cap imposed by the General Assembly. But the county's stand is sure to inflame a running showdown with north Fulton Republicans who say the county spends too much. And the outcome of the dispute could reverberate far from Fulton County.
Commissioners voted to repeal the new Fulton property tax-cap law after being advised they could. Acting County Attorney James Ramsey said the constitution gives counties the authority to repeal certain state laws that apply solely to that jurisdiction. Other legal experts aren’t sure about that.
The board will take a second vote in July to make its repeal of House Bill 604 official. The General Assembly approved that measure in March and Gov. Nathan Deal signed it last month. It would prohibit Fulton commissioners from raising property tax rates until 2015 and would require a supermajority of commissioners to raise taxes after that.
Officials in other counties are worried they could be state lawmakers’ next target. And similar disputes between state and local governments are popping up around the country.
“The impetus of the state/local friction is the insatiable appetite for more and better local services from county and city governments and less interest in paying for those services through increased taxes,” said Jack Williams, a Georgia State University law professor who specializes in tax issues.
Supporters say the tax-cap law would force the county to cut a budget they believe is bloated. Fulton officials say it illegally intrudes on local authority.
Chairman John Eaves noted that his colleagues in other metro counties also have expressed concern about HB 604. They fear the legislature is overstepping its bounds and signed a letter asking Deal to veto the proposal.
“I think we should fight it,” Eaves said.
The vote likely sets up a legal confrontation between the state and its largest county.
Williams said it’s unclear whether the General Assembly had the authority to impose the property tax cap. But he doubted the County Commission could legally repeal the law with a simple ordinance.
The better way to address the dispute would be in court, he said. Ultimately, the state Supreme Court may weigh in.
Commissioners took a series of votes to advertise the county’s proposed 2013 tax rates. The general fund rate would decline slightly to 10.211 mills, but would generate the same amount of revenue because property values are expected to rise.
But the county would implement a new levy to pay for its contribution to Grady Hospital.
Currently Fulton pays its Grady Hospital obligations out of the county’s general fund. Though it would move those obligations to a new fund and create a new levy to pay for it, the county would not reduce its general fund levy accordingly under the proposal unveiled Wednesday.
“The effect is, more money will be coming from taxpayers’ pocketbooks,” said Commissioner Robb Pitts, one of two commissioners to oppose creating the new hospital levy.
Whether that plan comes to pass remains to be seen. Interim County Manager David Ware said commissioners can approve higher or lower tax rates in July.
Buckhead resident Bernie Tokarz, who watched the vote, said he supports a separate levy for Grady – as long as the commission reduces the general fund levy to offset it.
“I think it’s crazy,” he said of the tax rates as proposed. “We need to be looking for efficiencies in the government that we have and not looking for an easy way in raising taxes.”
Rep. Jan Jones, R-Milton, said the tax hike may violate HB 604, and she doesn’t think commissioners have the authority to overturn the state law.
“The commission reminds me of a child that believes that ATMs magically dispense dollars,” Jones said. “Fulton County does not respect its hardworking taxpayers.”
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