The Clarke County School District wants to opt out of a new state law capping how fast property tax assessments can rise, and is planning to hold three mandatory public hearings this month.
Prompted by state legislators’ concerns about rapidly rising home values, and thus taxes, House Bill 581—ratified by Georgia voters in a November referendum—caps assessments at the rate of inflation. For example, if a home’s value rose 5% but inflation was 2%, the assessment for tax purposes would go up 2%.
However, city and county governments and school districts can opt out before Mar. 1. For those that opt out, the current system where county assessors use the fair market value to determine property values for tax purposes would remain in place.
Critics worry that the new law could starve local governments, particularly school districts, which are heavily reliant on property taxes and, under state law, cannot raise the tax rate higher than 20 mills to compensate. It could also lead to higher taxes for renters and business owners, since the cap only applies to owner-occupied homes.
“While the legislation would reduce the tax burden on homeowners on the surface, it could lead to an increase in the millage rate to offset the revenue difference, which would shift the tax burden to businesses and income-producing rental properties,” according to a news release from CCSD. “The state legislation provides school districts only one opportunity to opt out, and by not opting out, the district and BOE would lose local control over property-tax policies, along with the ability to tailor tax rates and exemptions to specific community needs and fiscal conditions.”
CCSD has lowered the tax rate in recent years from the maximum of 20 mills to 18.8 mills in response to higher property values. The district expects to take in $135 million in property tax revenue this year, which is 57% of its fiscal 2025 general fund budget. The rest comes from the state government through the chronically underfunded Quality Basic Education formula. CCSD also collects a 1% sales tax, but is restricted to spending it on construction projects and other capital expenses, not operating costs.
The three hearings are scheduled for 6 p.m. on Jan. 14, 21 and 28 at 595 Prince Ave., the district’s headquarters. The school board will then vote on an opt-out resolution at its Feb. 13 meeting.
The Oconee County school system also intends to opt out, although Flagpole contributor Lee Becker reported at his blog oconeecountyobservations.org that new chair Michael Ransom made the decision unilaterally, without a vote of the school board.
Athens homeowners could still save a few dollars off the ACC portion of their tax bill. Mayor Kelly Girtz has said he does not anticipate that Athens-Clarke County will opt out, because the ACC government has a more diverse tax base than CCSD and can more easily absorb the impact of the cap. Nor has ACC run the required legal notices to do so.
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