SUMMARY:

            This bill would amend Title 48 of the O.C.G.A. to revise the method of assessing real property, to limit increases to property values, to change the method of increasing or removing mill limitations for school systems, and to provide for optional discontinuation procedures.

REQUIREMENTS:

• Property assessments would not increase more than an aggregate 9% for each three years of successive ownership
• Three percent or the percent changed in the inflation rate, whichever is less, would be the maximum yearly increase.
• If the inflation percentage rate were less than 3% in one year, the rate in the subsequent year could exceed 3%, as long as the three-year requirement of no more than 9% was met.
• If the property is sold, it would be re-assessed at fair market value, or if substantial additions or improvements were made, those improvements would be valued at fair market value and added to the owner’s current assessment under this act.
• Property could be reassessed under the a number of conditions that take into consideration deaths, divorces, and business transactions within corporations, to name a few.
• The tax assessor would be required annually to send the owner a certificate to be signed and returned by the owner, subject to penalty of 3 times the tax if failed to return.
• The annual certificate requirement would not apply to an individual or group who directly own property outside a legal entity, including but not limited to a corporation, partnership, LLC, unincorporated association, or trust.
• Once there is an “assessable transfer of property” as noted above, for the next 7 years any annual increase in the value of the property would be limited to 1/7 of the difference between the fair market value and the most recent value of the property by the board of assessors in the year of the transfer.
• If a homestead is transferred, the appraised value would be the lesser of the following:
• • The appraised value of the newly acquired homestead property;
  • The appraised value of the former homestead property if the purchase price of the newly acquired homestead property is less than the sales price of the former property; or
  • The appraised value of the former homestead property plus an amount equal to the difference between the purchase price and the sales price of the former property, if the purchase price of the newly acquired homestead is greater than the sales price of the former property.
• Following the transfer of a homestead property, assessment increases would be limited to 1/7 of the difference between the transferee’s value and the most recent value established by the board of assessors in the year of the transfer.
• None of the above would apply to:
• • Public utilities
  • Any homestead’s ad valorem taxes under a general or local law exception that freezes the property assessment, unless the law is repealed.
  • Any homestead for which a constitutional amendment  has frozen property assessments, unless it is repealed.
• The mill limitation in effect on January 1, 2011 for any school system could be increased or removed only a majority approval through public referendum, paid for with school funds, unless the referendum is held in a municipality.  Then the cost would be borne by the municipality.
• Any system wishing to exceed the 20 mill limit would have to subject the question to a referendum for the district, paid for by county funds.
• The legislation in this bill would take effect only upon ratification of a resolution in the November, 2010 state-wide general election; otherwise, it would be automatically repealed.

NOTES:

• This bill is complicated and could result in major confusion and contention on the part of property owners, thereby slowing the operation of a tax assessor’s office and the county boards of tax assessors.
• School systems would be not only greatly limited in their ability to levy the taxes needed funds to operate a school system, particularly in the current financial crisis, but waiting until the November election for approval of a millage increase could result in budgetary shortfalls and financial disaster if the increase were rejected by the voters.
• This bill appears to favor greatly corporations and businesses at the expense of personal property owners.