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Property tax charges may drop in some Georgia school districts beneath a House plan that would let districts with low property wealth proceed to qualify for state aid even when they lower property tax charges.
The House voted 161-12 on Tuesday for House Bill 987, sending it to the Senate for extra debate.
The measure would let districts drop their minimal property tax fee to 10 mills, from the present 14 mills, and nonetheless be capable of qualify for state equalization funds.
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“This bill has the potential to lower property taxes for hundreds of Georgia residents throughout the state,” stated Rep. John Corbett, a Republican from Lake Park.
It’s one in a sequence of measures that Georgia lawmakers are contemplating this yr to scale back property tax payments. The House additionally needs to extend the statewide homestead tax exemption, which would reduce property tax payments for owners in some counties. The Senate, against this, is looking for to restrict the longer term improve in house owner property values, as assessed for tax functions. Senators imagine that transfer, in flip, may lower future will increase in property tax payments.
An aerial {photograph} reveals the Georgia State Capitol in Atlanta. (Joe Sohm/Visions of America/Universal Images Group through Getty Images)
Some school districts lately have advised constituents they cannot lower tax charges, regardless of rising property tax values, as a result of they would turn into ineligible for hundreds of thousands in equalization cash.
Georgia is distributing $756 million in equalization funds this yr, with districts allowed to spend their share as they see match. The cash is geared toward ensuring districts that do not have a lot worthwhile property to tax nonetheless have the funds for to teach college students. It has historically most benefitted districts within the southeastern a part of the state, Georgia State University scholar Nicholas Warner present in a 2019 examine
The equalization program started in 1987 with a minimal tax fee required and the state spending $84 million. But with the price of this system rising and state tax revenues stagnant, lawmakers rewrote this system to require districts to tax property at 14 mills or better to take part, starting in 2019.
That requirement is clashing with one other objective of Republican lawmakers, that districts maintain complete tax receipts stage by decreasing tax charges when property values rise.
“There are school systems throughout the state, even though they are able to go lower, who are remaining at the required rate of 14 mills because they don’t want to put their equalization at risk,” stated Rep. Chas Cannon, the Moultrie Republican sponsoring the bill. “In doing so, they’re passing on sometimes significant property tax increases to their citizens year after year.”
Statistics present total property tax collections rose 41% from 2018 to 2022 in Georgia. During that similar interval, complete assessed worth of property statewide rose by almost 39%. Those Georgia Department of Revenue figures signify not solely current property but in addition new buildings. So they don’t clearly state how a lot valuations rose on current property.
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Cannon’s bill would for the primary time scale back the quantity of equalization cash going to districts that dip under the 10-mill flooring. Those districts would lose 25% of their equalization cash within the subsequent yr.
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