Property Tax Freeze

Oppose Freezing Homestead Property Values for Ad Valorem Taxation Purposes

WHEREAS, the property tax is the most reliable source of revenue for local governments and funds necessary services including law enforcement, fire protection, emergency medical services, education, transportation and homeland security; and

WHEREAS, the portion of the property tax received by cities represents a relatively small portion of the typical tax bill, but is an amount critical to the overall revenue mix; and

WHEREAS, the Georgia General Assembly has, beginning in 1999, passed local legislation enacting residential property tax exemptions, subject to local referendum, that allow the amount of the exemption to increase at the same rate as the property value increases; and

WHEREAS, these exemptions effectively “freeze” the assessed value of homestead property at a base year value for as long as the homeowner owns the property; and

WHEREAS, such homestead property tax exemptions erode the local tax base upon which local governments rely to fund many necessary local government services; and

WHEREAS, to compensate, local governments are forced to raise millage rates and increase property taxes, thereby shifting the property tax burden to newcomers and businesses, causing them to bear a disproportionate share of the property tax; and

WHEREAS, local governments rely on newcomers and businesses in their communities for a variety of purposes and are reluctant to increase their property tax burden; and

WHEREAS, these “freezes” limit local government’s ability to depend upon the property tax as a steady revenue source with which to fund growing needs within communities; and

WHEREAS, the Metro Atlanta Mayors Association anticipates legislation, during the 2005 General Assembly, that would seek to amend the Georgia Constitution to establish automatic property tax “freezes” statewide, that would not be subject to local referendum; and

WHEREAS, this measure could apply to all types of property, which would significantly diminish local government’s ability to rely on the property tax to fund services, and would shift the property tax burden onto new residents and businesses; and

WHEREAS, enacting statewide property tax “freezes” for homestead property is inconsistent with a doctrine of equal taxation based upon valuation, is unfair to businesses and newcomers, and unhealthy for local governments;

NOW BE IT THEREFORE RESOLVED, the Metro Atlanta Mayors Association opposes legislation restricting local governments’ access to property taxation.

Approved September 30, 2004