The following was published in the Douglas County Sentinel this morning. The author, Birney Montcalm, is an appraiser in the Douglas County Assessors’ Office.
As a property tax professional, Montcalm understands what the politicians have yet to be able to grasp– an assessment cap would be completely ineffective and harmful to the property tax system:
“Georgia Legislative Watch” has graciously published our extensive commentary on the problems with HR-1, HB-233 and assessment caps in general. If you are interested the Georgia legislative process, check out this site.
The cure for “back door tax increases” is simple– require cities, counties and school boards to DO THE MATH. Doing so would remove a variable– the millage rate– from the control of local officials. No longer could they hide increases in the cost of government by maintaining an already inflated millage rate from year to year. No longer could they benefit from the windfall generated by rising assessments even when they don’t “raise taxes.”
Georgia Legislative Watch » COMMENTARY: Property tax issue dissected
The following was written in response to Senator Chip Rogers’ 2/13/09 article for the Georgia Public Policy Foundation, “Count on Tax Assessment Caps to Offer Property Owners Accountability:”
Senator Rogers is wrong when he writes that assessment caps are the best way to impose accountability on local officials.
First, there can be no real accountability resulting from an assessment cap because of the primary flaw in the tax law– a City Council, County Commission or School Board can currently adopt any millage rate that it chooses. There is no law that requires them to adopt a tax rate that has any connection to the cost of government. As a consequence, many adopt a tax rate that takes more from property owners than is required to fund government services. And the overtaxation happens even when the millage rate remains the same from year to year. Read more…
I have written an article describing, with actual numbers, the (I believe, unconstitutional) inequity inherent in HB-233, which was approved by the Georgia House of Representatives on Thursday. Click the link below.
The State Constitution requires that government treat its citizens equitably, except where the legislative creation of a special classification can be reasonably justified. In operation, HB-233 creates a special class of taxpayer– "Owner of a Property Substantially Increasing in Value"– and rewards him with a significant tax benefit.
MillageRate.com: Why HB-233 Is Unconstitutional… And Dangerous
Once again, Rep. Lindsey proposes to “fix” the unfairness in the state’s property tax system by introducing yet more inequity:
State Rep. Edward Lindsey (R-Buckhead) said the current crisis sheds light on a flaw in the system — that assessments are a tax on an unrealized gain — an issue that draws some complaints when values are rising but seems just plain unfair when they tumble.
The following correspondence was sent this morning to various reporters, state legislators and those quoted in the article:
D.L.,
If you will give me a little time I can show you, mathematically and without question:
1. Rep. Lindsey’s tax "freeze" proposal, if adopted, will introduce MORE unfairness into the tax system and financially harm the most vulnerable taxpayers;
2. There is a VERY simple solution to the "problem" that Lindsey seeks to solve. The problem isn’t "tax on unrealized gain;" there is a foundational flaw in the property tax code that politicians REFUSE to fix because it would result in more fairness and transparency and LESS power in their hands;
3. If that flaw is fixed, it would not matter AT ALL whether or not property owners were taxed on "unrealized gain." Lindsey’s concern would become a non-issue.
The solution isn’t anything new; the state Department of Revenue has taught this simple concept to tax commissioners, assessors, appraisers and Board of Equalization members for decades. I learned the solution to the problem from the state 15 years ago!
There are numerous other benefits as well to simply "doing the math." I am a former Board of Equalization Chairman with training in property tax matters. I publish the site at www.millagerate.com where I explain the problem, the solution and how the State Legislature could very easily eliminate many of the problems with the tax system, and without a constitutional amendment.
I field dozens of inquiries a year on Georgia property tax matters. This time every year, I contact every legislator to educate them and encourage them to address the root problem with the tax code. While a handful, including Lindsey, have expressed an interest only Senator Curt Thompson has offered significant assistance when, several years ago, he asked Legislative Counsel to draft a bill.
I am angered to see the AJC present Lindsey’s proposal without challenge, when he has no clue what he is doing. I invite you to meet with me to discuss this topic.
You can help move this issue in the right direction by contacting your representatives in the State Senate and House of Representatives and directing them to MillageRate.com.
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