MillageRate.com

The following was sent to members of the Georgia State Senate this morning as they prepare to consider HB-233 this week:

DO NOT READ ANY FURTHER….

… if you are a Republican who is a “team player,” whether or not “the team” is RIGHT OR WRONG…

… if you will not vote your conscience (or your intelligence) because it might cost you that plum committee appointment…

… if you really DON’T CARE whether or not the legislation you support actually DOES what it is supposed to do, or might even cause MORE HARM than good…

… if you have NO CLUE and do not care to know THE TRUTH about HB-233.

WHAT HB-233 DOES NOT DO –

1. HB-233 does NOT promote EQUALITY in taxation, as required by the State Constitution:

“…. all taxation shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax.”  (Article VII, Section I, Paragraph III)

In fact, HB-233 will CAUSE inequity. The owner of one home will pay LESS than his fair share of the cost of government while the owner of a similar home– even one right NEXT DOOR– will be FORCED to pay MORE.

The city of Columbus has had an assessment “freeze” on homestead property for more than 25 years.  Today, more than 16,000 property owners pay less than $50 in property taxes, while newer residents in similar properties may pay over $2,000.  That means that those who were not fortunate enough to buy in Columbus in the early 1980s are now footing the bill for those who did.

This same inequality will create an unfair business advantage for existing businesses… new businesses will start with an immediate tax disadvantage and may think twice before moving to Georgia.

2. HB-233 does NOT protect property owners from HIGHER TAX BILLS.

First, HB-233 will KILL THE TAX CUT. No city, county or school board will jeopardize its revenue stream by lowering the millage rate while the tax digest is being artificially depressed.

Because the value of ALL property– residential and commercial– will be frozen, the tax digest of every levying authority in the state will be severely depressed. As local government struggles to meet the needs of its constituents, the “back door tax increase” will be transformed into the FRONT DOOR TAX INCREASE when they are forced to raise the millage rate.

EVEN WORSE… a taxing authority may raise the rate even higher than necessary in the first year, just to avoid smaller rate hikes two or three years in a row. HB-233 will encourage ARBITRARY OVERTAXATION; inflated tax rates that have absolutely no mathematical connection to the budget.

WHAT HB-233 WILL DO –

1. HB-233 will begin the shift of the tax burden from commercial to residential property. HB-233 will give an advantage to property held in land trusts and corporate ownership. Because caps are adjusted only when property sells, corporations will go to great lengths to ensure that property is not “transferred.” Ongoing corporate ownership protects the artificially low value, which will slowly shift the tax burden to residential properties which transfer ownership much more frequently.

2. HB-233 will reduce the transparency and accountability of the property tax system as a whole. No longer will there be a logical and legitimate connection between assessed value and fair market value.

3. HB-233 will discourage wise home ownership. An older couple who may otherwise sell a larger home and downsize may choose to remain in a home that they can no longer afford, just because they can likewise NOT afford the bump in their tax bill.

Those wishing to buy a larger home will also be discouraged from doing so because of the tax advantage given to longer-term ownership. It doesn’t make sense in the current economy to enact laws that actually DISCOURAGE home purchasing.

Finally, the passage of HB-233 will cause the State Legislature to QUIT SEEKING a real solution to the problem of “back door tax increases” and inequities in the property tax system.