I support this measure

It’ll keep local politicos honest about the money they are bringing in from us.

For the past 15 years, local elected officials have been able to reap revenue windfalls while boasting they cut taxes.

State lawmakers hoped last week to end that practice, when the Georgia House passed a provision to cap the growth in property assessments. The cap, included in a bill that would eliminate the car tag tax, followed a failed attempt to limit the revenue growth of local governments. On Wednesday, a Senate committee removed the tag tax from the House resolution, but it passed the rest of the measure —- including the cap on property assessments —- on to the full Senate.

10 comments

  1. BobG says:

    Erick, if you (as an honest politician and fine individual) understood how the property tax process worked as I do, you would oppose an assessment cap.

    First, the cap can’t eliminate the “back door tax increase” because taxing authorities are not required to adopt a mathematically-correct millage rate. Whether assessments rise by 10% or are capped at 3%, taxpayers will still pay more when politicians can leave the millage rate the same as the previous year!

    Second, you would understand how a cap shifts the cost of government from the owners of high-dollar homes in fast growing areas to the owners of slower-appreciating homes in the same jurisdiction. A cap will “constitutionalize” inequity in the property tax system.

    Finally, the assessment freeze will kill the tax cut. Never again will a taxing authority lower its millage rate– with the growth in the Net Tax Digest being depressed more and more each year, taxing authorities can never again afford to cut the rate. And with no law requiring them to adopt a mathematically correct millage rate, they will always opt to keep the inflated rate or raise it when necessary.

    I would appreciate the opportunity to discuss this with the esteemed council member in detail… I can’t get a single state legislator to call me back!

  2. suwtiger says:

    Erick, I will start, a couple of weeks ago the Speaker himself said that assessments cap without rate caps are worthless. Even he had this one correct. Lets put in assessments caps and watch the tax rates rise. No, people wont go to county commision meetings to complain about it because we all have 30 second memories. Yes, people living in $1 million+ homes or beach front homes will make out much better than those living in $150,000 homes and I guess if everyone is okay with that………

  3. BobG says:

    An assessment cap with a rate cap is even worse. Inequity in the tax process remains. Property owners currently overtaxed by a mathematically-incorrect rate are still overtaxed. Future tax rate cuts are just as dead.

    But with both, you prevent a city from rebuilding a reserve depleted by a weather emergency. You prevent a county from adequately responding to a growth spurt with additional roads, fire stations and police service. And you force a school system to install more trailers because they can’t afford to build a much-needed new school.

    It sounds so big and bad to say that you’re going to put those cities, counties and school boards in their place. Quite frankly, those who advocate caps (assuming no evil intent) simply don’t know what in the hell they are talking about. And the scary thing is that someone of those ignorant folks have the ability to make law.

    I can prove with very little effort that assessment/rate caps will not accomplish the purposes for which they would be enacted. I can prove that they will cause a specific financial harm to many Georgia property owners.

    And I can explain how the correction of a little deficiency in the current law could eliminate the perceived problems while doing NO HARM. Further, I can show how this correction would result in significant TAX CUTS for many Georgians. Finally, I can GUARANTEE that, going forward, no taxing authority would ever take more from its constituents (through an inflated tax rate) than necessary to balance the budget.

    http://www.millagerate.com

  4. OleDirtyBarrister says:

    And I can prove that the employment of people unqualified to do real property appraisals by local government costs taxpayers in this state a fortune. To compound matters, the people sitting on the Boards of Equalization-the dreaded bluehairs, busbody housewives, and other undesirables with little or no acumen for the job, are equally clueless. They haven’t even figured out the changes that were made by the Taxpayers BOR from back in 1999 under Roy,

    When the counties get smacked in court or arbitration, rather than allowing a taxpayer to have a 3 year lock-in, they just go back and do a mass appraisal the next year. That way, everything starts over, and anyone not pleased with the appraisal has to hire an attorney and start over.

    The terms “assessment” is overemphasized by the mainstream media and the pundits alike. An assessment is a simple calculation, it is 40% of the appraisal. It’s in the appraisal where the mischief occurs, and that is where the law allows one to lodge a challenge. It’s rare that any county appraisers are MAI or otherwise truly qualified for the job. In Fulton Co. and other populous county, it’s rare that the appraisers set foot on a piece of property in conducting an appraisal. It’s all desktop, and their interpretation of the term “comparable sale” is a joke. Most of them do not know that the Ga Dept. of Revenue has promulgated regs and published a manual for appraisal.

    I agree that there is room for mischeif in the millage rates as well, but that has not created the churning cycle of battles that the appraisal process has.

    There will be an interesting battle coming up in Fulton Co. The county conducted a mass appraisal countywide exclusively on all commercial properties, and have jacked them up sky high. It never stops.

  5. BobG says:

    OleDirtyBarrister, with a correctly calculated millage rate (and an equalized tax digest, which the state reviews and requires), none of what you complain would matter.

    With a correctly calculated millage, as assessments (the Net Tax Digest) increase, the millage rate MUST decrease– simply as a function of the math– as long as the politicians control spending.

    And, as a parting shot… the millage rate rollback which was included in Barnes’ TABOR is part cause of the current day problem. Like today’s cap proposals, it was a try at tax reform that was pushed by uneducated and ill-informed politicians looking for a political boost.

    Signed… the former Chairman of a Board of Equalization.

  6. Progressive Dem says:

    State Reps and Senators are jealous of the power and effectiveness of local government officials. Local governments actually accomplish something. Parks, libraries, schools, court houses, jails get built. Services that matter: police, fire, garbage collections, traffic lights, streetlights, water and sewer are delivered. State reps and senators on the hand have little to show for their effort. All too often they invent some outlandish proposals to gain attention.

    The state needs to tend to their knitting and not f around with local governments. The General Assembly believes voters are fools, and can’t protect themselves from higher property taxes and local budgets. It is really insulting. Local government gives us local options and local conrol. The state is intruding between me and my local government. Go away and stop acting like I need State protection. This is bad legislation.

  7. cheapseats says:

    Nothing more than politically grandstanding and relying upon the most reliable “friend” that this slippery shysters have ever had – the uninformed voters.

    Counties have been forced to follow the rules for reassessment of properties that were set by the General Assembly and the arrogant potato-heads in Atlanta want to refer to that as “backdoor tax increases” as though the local governments were the bad guys.

    I need protection from the liars in the General Assembly – not from my local elected officials!

  8. BobG says:

    You’re right, cheapseats, and as I have repeated ad nauseum, the entire problem could be resolved if taxing authorities just adopted a mathematically correct millage rate.

    Obviously, you guys aren’t reading my web site; otherwise, there would be a groundswell of support and, yea, reverence for my proposal! 😉 So here it is in a nutshell:

    There is only ONE WAY to calculate the millage rate– divide the portion of the budget to be funded by property tax dollars by the Net Tax Digest. Multiply the result by 1,000 and you have the millage rate, which is the amount of tax in dollars on every thousand dollars of taxable value required to fund the budget– no more and no less.

    Every other method is just a guess.

    Because the part of the budget to be funded by tax dollars changes from year to year, and because the Net Tax Digest does as well, it is nearly mathematically IMPOSSIBLE for the millage rate to remain the same from year to year… if you’re doing the math. (That’s the definition of a “back door tax increase happens… the rate stays the same while assessments increase.)

    Here’s the beauty of simply computing the rate the right way– as the Net Tax Digest (assessments) increase, the millage rate must DECREASE… simply as a function of the math… as long as the politicians control increases in the portion of the budget to be funded by tax dollars.

    So the millage rate floats up and down each year as a reliable indicator of your local officials’ ability to control spending OR identify non-tax revenue sources like user fees, impact fees, sales tax, etc.

    This is nothing new… this procedure has been taught by the Dept of Revenue for decades to tax commissioners, appraisers and assessors, and Board of Equalization members for decades! The problem is that the process is NOT taught to the elected officials who adopt the rate. Even if it was, however, no politician would voluntarily raise the rate when necessary, so a state law requiring them to “do the math” is required.

    It REALLY, REALLY is that simple. So simple that you’d think a state legislator or two would catch on… but, no….

    Actually, one legislator agrees with me, but introduced an assessment cap anyway.

  9. BobG says:

    Correcting a typo; revising and extending…

    The dreaded “backdoor tax increase” occurs when assessments rise but the millage rate remains the same.

    Here, again, is the effectiveness of the assessment cap debunked: whether assessments rise at 10% a year or are capped at 3%, a “backdoor tax increase” still occurs when the millage rate stays the same from year to year. Nothing in the legislation contemplated this session requires taxing authorities to adjust the millage down as assessments increase. Get it?

    Sure, at 3% the “backdoor tax increase” isn’t as large, but it still occurs.

    Why not require politicians to “do the math” and give the taxpayers a break when increases in spending are controlled and assessments rise?

    Asked another way– why are state politicians battling over constitutional amendments to keep taxes from rising when they could, with a simple law change, actually force local officials to LOWER taxes when assessments rise?

  10. Bill Simon says:

    “Mathematically correct?”

    No offense intended towards you, Bob, but this here state of Georgia haas been riding the dead-last position in edjumacation for nigh on a century or so.

    The most challenging math exercise our legislators bother themselves to wrestle with is counting how much per diem they accumulate for every day they can stretch a session to.

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