Georgia homeowners got some good and bad news in a property tax bill that passed the state House of Representatives on Friday.
The bill would fund a property tax break worth an average of $200 to $300 per household this year. But after that, the break could very well be history, meaning local governments will have to look at either raising taxes or slash spending to make up for the lost state cash.
The House voted 117-55 to find $428 million to pay for the Homeowner Tax Relief Grant. Gov. Sonny Perdue slashed the money from his fiscal year 2009 budget proposal to help close the state’s $2.2 billion shortfall.
Floyd County’s House delegation voted in favor of the measure, which would restore about $4 million to local coffers.
Rome and Floyd County governments already have sent out tax bills. Homeowners would be slapped with an additional bill if the state fails to deliver the money. The state Senate must still pass the measure.
State Sen. Preston Smith, R-Rome, said he favors funding this year’s tax credit, which was granted on 2008 tax bills, although it means finding cuts elsewhere in the state budget. He’s also ready for a change to the automatic allocation.
“I’m bothered that the counties don’t seem to pass that savings directly to the homeowners,” he said. “This went into effect in 1999, but in the interim, tax bills have continued to go up.”
Floyd County Tax Commissioner Kevin Payne has said the credit covers the first $220 of property taxes for each primary residence in the city of Rome and the first $240 for homesteads in the unincorporated part of the county.
That works out to about $1.7 million in revenue for Floyd County; $1.9 million for county schools; and $1.1 million for Rome and its school system.
State lawmakers will have to find more budget cuts to pay for the tax break, and they haven’t identified yet where the money will come from.
The state-funded relief would only continue if Georgia revenue grows by 3 percent plus the rate of inflation. In the near term that’s unlikely in the recession-ravaged state.
Democrats had championed a constitutional amendment to lock in the tax break. But the bill’s sponsor, state Rep. Larry O’Neal, R-Bonaire, argued it was never meant to be an entitlement, stressing that funding the break this year keeps a promise the state made to pay.
The tax relief grants are provided to local governments and passed along to homeowners as a tax credit.
Rome News Tribune