The Bulloch County Board of Education voted 8-0 tentative approval Thursday evening for a partial rollback in the property tax millage rate that helps fund the schools, from last year’s 8.478 mills to 7.932 mills.

That is a 0.546-mill, or 6.44%, decrease in the rate, as such. Bulloch County currently has one of the 10 lowest property tax millage rates for school operations in the state, and considered just as a factor in levying taxes and not by the dollar value, 7.932 mills would be the Bulloch Schools’ lowest rate in well over a decade.

However, under the requirements of the state law known as the Georgia Property Taxpayer’s Bill of Rights, the board must advertise the new rate as a tax increase because it does not fully compensate for inflation in property values as determined by the county Board of Tax Assessors and staff. Under the law, the board – or its staff – will also have  to hold a  series of  three tax  increase hearings.

The “rollback rate” the school system would need to  adopt  to fully offset the average overall inflation in property values would  be 7.558 mills, or 4.95% less than the 7.932-mill  rate now proposed.  So the public hearings, slated for Thursday, Aug. 8, at 9 a.m. and Thursday, Aug. 15 at 11:30 a.m. and 6 p.m. are set to be advertised with a notice of a 4.95% tax increase.

After saying she was struggling with how a rate rollback can result in a tax increase  and how this will play with the public, Board of Education Chair Elizabeth Williams arrived at an explanation.

“If we keep (the rate) at 8.478 where it is, the taxes are going to go up even more,” Williams said. “By rolling it back just a little bit, we reduce the damage that’s done with the tax increase. I think that’s important to hear.”

A 14-mill dilemma

For a third consecutive year, Bulloch County – largely because it uses sales tax to help fund the schools and has one of Georgia’s lowest property tax rates for school funding – comes up against a dilemma created by a requirement that all districts maintain a “minimum equivalent millage rate” of 14 mills to remain eligible for state equalization funding.

“Or we could lose our equalization money, which is part of our state QBE funding formula,” Alison Boatright, the school system’s chief financial officer, told the board. “For us to (go lower than) 14 mills of tax revenue would mean an equalization funds loss of $9.8 million.”

The majority of the school system’s funding comes from the state, allotted on the basis of the Quality Basic Education, or QBE, formula for per-student funding, which differs for grade levels and programs. Annual equalization grants are “intended to close the gap between high- and low-property-wealth school systems,” Boatright explained.

The “equivalent” or “effective” millage rate becomes an issue because Bulloch is one of just  seven or eight counties in the state  where the  original  1% Local Option Sales Tax, or LOST, was assigned decades ago to operation of the schools. This was intended to produce a permanent rollback in the actual property tax rate.

For those seven or eight counties, the “equivalent millage” is the sum of their LOST revenue converted to the amount of property tax millage that would be needed to replace it plus the actual property tax rate. Bulloch County School’s 2023 Local Options Sales Tax revenue was the equivalent of 6.068 mills. Subtracting 6.068 mills from 14 mills leaves 7.932 mills, now the proposed millage rate.

So if it adopts that rate, Bulloch County’s school board will be pegging its effective rate at 14 mills. Many of the school districts that do not have Local Option Sales Tax for schools set their actual millage rate at exactly 14 mills, Boatright noted. A list of the county, city, school district and special district millage rates for 2023 throughout the state posted by the Georgia Department of Revenue on its website shows this to be true.

‘Rock bottom’ millage

The average of all the 180 Georgia school districts’ school tax rates is about 14.8 mills, Boatright said.

“We’re at rock bottom. …,” said Bulloch Schools Superintendent Charles Wilson. “I mean, we’re in the lowest of the low across the state with our millage rate.”

The reporter’s first cursory look through the Department of Revenue list Friday revealed five county school systems and one city school system with “school” millage rates lower than Bulloch’s as of 2023, all in or near  the mountain region of northern Georgia. That’s  out of 180 school districts.

How millage works

However, millage rates are just one factor in determining property taxes. Another is the value of homes, businesses and land as determined by the county tax assessors, based on real estate sales in each neighborhood. Inflation, especially in home prices, and some real growth from new construction has driven Bulloch County’s tax digest value to record levels the past three years.

After millage rollbacks each year from 2019 to 2021 and a partial rollback to 8.263 mills in 2022, the board actually increased the rate to 8.478 mills last year, after Wilson and staff also cited the need to maintain the 14-mill effective rate.

This year, with the partial rollback, the school system is projected to receive $2,007,821 more property tax revenue than last year, an increase from $25,289,621 in 2023 to $27,297,442 in 2024. The budget the board approved June 27 for fiscal year 2025, which began July 1, projects $154.27 million in general  fund spending and $149.1 million revenue,  as the school system reduces a $59 million reserve accumulated while receiving special federal funds from the pandemic  years.

One mill is 1/1,000th of the value of property as assessed for taxes. But Georgia assesses tax on only 40% of the value of most property. So a tax of 7.932 mills amounts to $793.20 total school tax on $250,000  worth of property with no homestead exemption. Because of the uncompensated 4.95% inflation left after the partial rollback, this would be a $37.40 increase in tax on the example non-homestead property now valued at $250,000.

On a $250,000 owner-occupied home with the standard homestead exemption, the total school tax would be $777.34 and the average increase, $36.65. Again, these are averages, and changes in assessed values vary by neighborhood and property type.

“If your property value didn’t change, then actually you will be paying less,” Boatright said.

District 3 board member Stuart Tedders made the motion for tentative millage rate adoption, and District 7 member Heather Mims seconded it.

In most other Georgia counties, the original Local Option Sales Tax revenue is divided among city and county governments, not schools. The E-SPLOST, or Education Special Purpose Local Option Sales Tax, which the Bulloch County Schools also received – not  for  operations  but  for  building projects and capital purchases –  is a separate 1%  tax not involved in calculating the equivalent millage.