By John S. Sherman
In the midst of the worst recession since 1929, Atlanta and Fulton County homeowners desperately need tax relief.
Homeowners in Atlanta / Fulton County are charged 44.165 mills (including schools and county). In other words, for every $1,000 of assessed property value, you pay $44.165. Indeed many residents are moving to lower-tax areas because of this fact.
State law encourages tax relief
In 1997, based on state tax-relief legislation known as Home Owners Sales Tax (HOST), the voters of DeKalb County approved a 1 percent sales tax to offset the DeKalb County operating costs, saving the homeowners an average of 21 percent per year. The Taxpayers Foundation urges both the city of Atlanta and Fulton County to consider and adopt Homeowners Sales Tax as tax relief for homeowners.
At the present time, the Georgia statutes apply only to homeowners in the 159 counties in Georgia. In order to apply the HOST to the city of Atlanta or any other city in Fulton County, an amendment to the present authorizing legislations would have to be approved by the state legislature, and the HOST would also have to be approved by a majority of the Atlanta City Council and the voters.
The savings to the taxpayers
Assuming both the city of Atlanta and Fulton County were to adopt the 1 percent sales tax to offset the property taxes, the taxpayers in the city of Atlanta would save 46 percent of their present property tax. The taxpayers in North Fulton County would save 32.1 percent while the taxpayers of South Fulton (outside of Atlanta) would save 25.5 percent of their total property tax.
Were only the city of Atlanta to adopt the 1percent sales tax to offset the property tax, the city taxpayers would save 23percent of their present property tax. Were Fulton County to adopt the 1percent sales tax to offset the property tax, the county taxpayers would also save 23 percent of their present property tax.
In either scenario, this is a win-win for the taxpayers and local governments.
State encourages HOST
The state encourages the Homestead Sales Tax by stating in law that “the use of sales tax funds to grant the Home Owners Sales Tax (HOST) exemption cannot be less than 80 percent of the sales tax for the prior year’s collection.” Based on Atlanta’s 2009 Annual Financial Report, the 1 percent sales tax in the city of Atlanta totaled $105 million for 2009 alone!
Sales tax availability
The present sales tax in the city of Atlanta is 8 percent. To avoid exceeding this, the Taxpayers Foundation proposes ending the 1 percent Atlanta sales tax (known as SPLOST) for new school construction in the Atlanta Public Schools. Enrollment in the Atlanta Public Schools has steadily declined to its present low of 47,789 students. Furthermore, there is sufficient funding for any new school construction from the city of Atlanta property taxes, 37 percent of which goes to the Atlanta Public Schools.
Homestead Exemption increase
Beginning Jan. 1, 2011, the Fulton County Homestead Exemption will increase from the current $25,000 to $30,000. For those homeowners, currently receiving a Homeowners Exemption, no further action is required for the increased exemption unless there is an ownership change or if you have become eligible for an additional exemption (minimum-income seniors). First-time Fulton County homeowners or those applying for an additional exemption have until April 1, 2011, to file.
For the city of Atlanta and Fulton County, which are generating 1,900 notices of foreclosure monthly, the elimination of the Atlanta and Fulton operating taxes would help the tax-burdened homeowners and attract more residents to a “low-tax” city of Atlanta and Fulton County. This would be a win-win for the taxpayers, the cities and the county, particularly during the current economic crisis.
John Sherman is president of the Fulton County Taxpayers Foundation.
The Fulton County Taxpayers Foundation is sponsoring a luncheon on Jan. 12 at Anthony’s restaurant in Buckhead. The guest speaker will be Michael Bell, who will speak on the concept of a 1 percent sales tax to offset property taxes. As chief financial officer of DeKalb County, Bell initiated work toward such a tax in 1997. It was enacted in 1999.