Backdoor Tax Increases on the way in Fulton County

Crystal Freeman got a notice that the taxable value of her Grant Park home jumped from $438,700 to $532,900. She complained that other, larger houses on her street are valued at less.

“I simply do not understand that,” Freeman said. “I can’t understand why mine went up $100,000. If I were to sell, I couldn’t get this. It’s going to force me out of my home.”

Source: 5/8/2008 AJC article “Fulton property owners face city, county tax hike”

There is no other way to say it.

This is a backdoor tax increase.

It happens every year across the state. The local board of tax assesors goes out and appraises your property, then a few weeks later you get a notice in the mail saying that your property is worth a lot more than you’d be able to sell it for on the open market. Then, to make matters worse, when you ask your county commissioner or city council member (sometimes both) why your taxes have gone up, they give you the extremely misleading answer that “I haven’t voted to increase the millage rate. Your taxes have remained the same.”

Um…excuse me, but no they haven’t. Last year, I paid $800 in property taxes. This year, I’m paying $1,100 in taxes…oh yeah, my taxes have gone up.

This year, in the Georgia General Assembly, a bipartisan group of Democrats and Republicans introduced a constitutional amendment —House Resolution 1170— that would have effectively ended these backdoor tax increases by freezing the value of a person’s property at 2002 levels. Unfortunately, the proposed amendment never made it out of committee despite the fact that House Speaker Pro Tempore Mark Burkhalter (R – Alpharetta) had favorable words for the measure saying, “If local officials want to raise taxes, they should have to do it openly and honestly.”

Well, I think H.R.1170 should be introduced again in the 2009 legislative session and each year after that until we put an end to this annual ritual of the government raising our property taxes without actually raising our millage rates.

11 comments

  1. BobG says:

    If you WERE to raise your mileage rate, Andre, all that would happen is that you would save money on gas. But the question here is MILLAGE rates…

    I have demonstrated at MillageRate.com how your bipartisan group of Democrats and Republicans did nothing more last year than demonstrate their gross ignorance of the property tax process.

    The proposed legislation not only would not eliminate the so-called “back door tax increase” (it would just slow it down a little) but it would introduce inequity into the tax computation. Two Georgians in comparable homes in the same taxing jurisdictions will pay differing amounts of tax… which is the definition of inequity.

    Now, if you don’t care that one Georgian pays more than his fair share of the cost of government than does another equally-situated Georgian, go for it. I prefer a tax system in which everyone pays his fair share.

    Now what if the proposed legislation created a huge windfall for wealthier homeowners in more affluent areas while penalizing (or, at least, failing to benefit) those less able to pay in slower-growing, stable or stagnating areas?

    That is EXACTLY what an assessment freeze does. If the cap is 3%, for example, the owner of a home that appreciates at LESS than 3% a year will receive NO benefit while the owner of a home that appreciates at 10% a year will receive a net benefit of 7%. The first owner continues to pay at 40% of Fair Market Value while the latter guy pays much less.

    Don’t despair… there is a much simpler solution that will not only REALLY eliminate the “back door tax increase” but preserve fairness AND ensure that taxing authorities take no more than is required to fund the budget. Moreover, my solution will ensure that, as property values increase the millage rate DECREASES… as long as the politicians control the cost of government.

    And there’s the TRUE benefit of my proposal… elected officials will be FORCED to cut costs or face the wrath of the voter.

    Please read http://www.millagerate.com and, specifically this on-topic article: http://www.millagerate.com/blog/?p=34 . The most recent stuff is in the blog at http://www.millagerate.com/blog/

  2. SouthFultonGuy says:

    Andre what do you expect from a county led by your fellow tax raising democrats?

    Did it occur to you that if Milton splits off into a new county like you advocate, that there by necessity will be huge tax increases through the “front door” of what’s left of Fulton?

  3. drjay says:

    in sav’h/chatham county the stephens /day bill is suppose to take care of this sort of inequity–i am not well versed in it but my understanding is that assessments increases are treated as de facto tax increases and if the millage rate is not subsequently lowered to make the assessment revenue neutral then the governing authority–county commision or city council or school board has to have hearings and do all the things they would do for an actual tax increase to keep both the higher assessment and previous millage rate–that may be an oversimplification (or may be completely wrong) that i think that’s how it goes…

  4. drjay says:

    of course my city council in the four years i’ve lived here has raised the millage rate slightly every off year–then rolled them back stephens/day style every election year and proudly proclaimed they “lowered our taxes” heading into the election…

  5. Harry says:

    I’m sorry, the correct figure is $53,292,983,000. They rounded off the last three digits. That’s 53 Billion.

  6. Harry says:

    That means every man, woman and child in Georgia has almost six thousand dollars “invested” into schoolteacher retirement. Many of these folks draw $50 thousand per year and more in retirement benefits, plus some social security in most cases. I know a schoolteacher widow who receives almost $100k per year on her and her deceased schoolteacher husband’s pensions, plus social security.

    Taxpayers receive overall compensation that would make a large majority of taxpayers in their districts green with envy.

  7. Harry says:

    Why state and federal workers aren’t required to be under social security like the rest of us is unbelievable. The city of Atlanta’s pension contributions for their workers that has caused them insolvency.

  8. BobG says:

    Actually, drjay, (with all due respect) you are completely wrong! Well, actually, you have confused a couple of things.

    The legislation that Andre described is based on Stephens-Day. The Chatham legislation has the same flaws that I noted for the proposed constitutional amendment.

    Finally, you describe the Roy Barnes’ “Taxpayers Bill of Rights” millage rollback. That’s where the taxing authority has the OPTION to roll back the millage rate by a percentage generally comparable to the growth in the Net Tax Digest. If they propose not to rollback, they are required to conduct public hearings and advertise a “tax increase.”

    The problems with the TaBoR are numerous. It was the FIRST legislation that we were told would eliminate “back door tax increases.” The politicians were wrong then and they are wrong now about the current proposals.

    Read http://www.millagerate.com. The solution is so incredibly easy– if taxpayers really understood how state legislators have allowed local governments to exploit a flaw in the current law and adopt millage rates that have no mathematical connection to their respective budgets, they would be outraged.

    Educate yourself– then demand that the politicians simply DO THE MATH.

  9. drjay says:

    i readily admitted not being well versed in this particular issue–and it was explained to me by a former city council member w/ his own agenda–so his explanation may have been purposely unclear–i will go to the website you reference as i do have a vested interest in my local gov’t and may run for office again in the future…thanx for the info…

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