County officials worried after Governor Perdue freezes property tax relief

Governor Sonny Perdue's move to freeze a $428 million grant program for property tax relief for homeowners is creating controversy.

It's another way he's looking to reduce spending because of the state's budget shortfall.

Counties typically send bills for the discounted rates and then replenish that amount with the grant in their budget.

But Perdue says local governments are using the money to fatten their coffers while raising property taxes.

His decision to freeze the grants is causing problems for local governments.

The Augusta-Richmond commission and school board, for instance, were expecting close to $3 million each.

"We've got a budget to balance too. And this year, we balanced our budget based on the promise of that $3.1 million and that particular grant that's been frozen," says Fred Russell, Augusta's city administrator.

Richmond and several other counties across the state are sending out tax bills that still reflect the reduced tax.

How counties will make up the loss, if the grants are still frozen, is unclear.

Homeowners near Masters golf course in Augusta get tax breaks

Seven homeowners near the Masters golf course will get the tax breaks.

That's thanks to a state law known as a traditional use covenant.

It allows exemptions for homeowners whose taxes have increased due to an unusual market influence. Such was the case when the Masters bought up land around its property and turned it into parking lots this year.

The Richmond County board of tax assessors voted to bring taxes around the Masters golf course back in line with other residential property nearby.

One homeowner says last year he paid $2000 in taxes for a third of an acre while the Masters paid only about $470 for the same amount of land. The homeowner's taxes this year will drop to $600.

Local Officials to Leap Year: Thanks A Lot!

Local tax revenues declined in some areas by as much as twenty two percent this past month. Yet most of that shortfall is being blamed on an accounting glitch at the Georgia Department of Revenue.

Officials at the DOR say a leap year glitch is responsible for the revenue declines this month.

When consumers pay sales tax, retailers send that money every month to the DOR. From there, checks are cut and sent back to local municipalities.

This February there was an extra day. According to the DOR, the 29th day of February caused some discrepancies.

In the end several Georgia Municipalities were surprised with a twenty percent reduction in revenues. The underpayment seriously stressed out some city managers, who were bracing for a smaller reduction because of the stagnant economy. It’s unclear if there are any long term consequences of the underpayment. The DOR hopes to have the money to the local governments by next month.

Tax reform amendment passes House

Yesterday was Crossover Day at the state Captiol, and several bills did not make the cut for consideration this year. They include constitutional amendments to make English the official language of Georgia and to give a fetus the same rights as a person.

However, the state House did finally pass Speaker Glenn Richardson's tax reform amendment. The final version, which is dramatically different from Richardson's original proposal, passed with only five dissenting votes.

As it stands, the resolution would cut taxes on cars, eliminate the state portion of property taxes, and slow down property tax assessments. It does not cap millege rates, which had been a sticking point in debate of the measure last week. The amendment now goes to the Senate where it needs a two-thirds majority to be placed on the November ballot.

Property tax assessment resolutions pass in Senate

Tax reform has been the buzzphrase at the State Capitol during this election year. Tuesday, lawmakers put some actions to their words when the Georgia Senate passed two similar resolutions that would freeze property tax assessments.

Property values would be frozen and increases would be limited each year under the resolutions. The most popular one was sponsored by Republican State Senator Chip Rogers.

"This would actually freeze the property assessments at the 2008 value for residential and non-residential property...and allow the residential to go up by 2-percent, and the non-residential property by 3-percent".

Over 30 Georgia counties have similar laws already on the books. A few Democratic Senators warned that the move could cause local governments to shift the tax burden to a higher sales tax. The resolution will need approval from the state House before it can go before voters in November as a Constitutional Amendment.

Bill would abolish state property taxes

A bill filed today in the General Assembly would get rid of the state property taxes. It would get rid of the state portion of ad velorem taxes on homes, land, automobiles and personal property. It would require a Constitutional Amendment the measure calls for putting the question to voters. An amendment requires the approval of a majority of Georgia voters.

Richardson might compromise tax idea

Georgia House Speaker Glenn Richardson may be ready to compromise on his tax reform proposal. He has been shopping his idea of replacing all property taxes with an expanded sales taxes on goods and services.

Richardson's so called Great plan has gotten the cold shoulder from many including Governor Sonny Perdue. Opponents say it just wouldn’t raise enough money make up for the lost property taxes.

Richardson told the Macon Telegraph this week that he may propose to eliminate only that portion of the property tax that funds schools.

A spokesperson for Richardson confirmed that he is looking into that option. The move could silence opposition from counties and cities who fear the loss of control over their budget under the Great plan. School boards, especially those in wealthy counties, may not like the idea.

Any tax reform proposal hashed out during next years legislative session would need voter approval in November.

Perdue: no need to kill property taxes

Governor Sonny Perdue on Monday cautioned against diving headfirst into the type of tax reform proposed by state House Speaker Glenn Richardson.

In a speech to the Atlanta Press Club, Perdue said Georgia's tax structure is fundamentally sound, and any ideas to change it should be carefully analyzed.

"We aren't facing the same funding crisis that other states are dealing with, and we don't need to create one in our state by shifting revenue sources from more stable streams of revenue, to more volatile streams of revenue".

Richardson wants to eliminate the property tax, which generates nine billion dollars in state revenues, and instead expand sales taxes.

Perdue said that could make Georgia's revenue stream vulnerable during economic downturns.

The governor said he's not opposed to some tweaks in the tax system, but that they should be date-driven and openly debated.