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Local tax break would add to state exemption
BOE requests more info, does not commit to seniors' request
brown
School system Chief Financial Officer Troy Brown speaks to the Bulloch County Board of Education. - photo by AL HACKLE/Staff

Any exemption for Bulloch County senior citizens from the school-funding property tax would likely take the form of a local addition to the existing statewide, limited exemption for people age 62 and older.

Troy Brown, Bulloch County Schools' chief financial officer, presented that interpretation Thursday evening at the Board of Education meeting. Having heard from citizens on both sides of the issue in August and from some proponents of the exemption again on Sept. 12, the board members discussed the question among themselves and with Brown and the superintendent Thursday.

School board members requested more information, including how much an increase in the exemption would cost the school system, but made no commitment to propose a local exemption, with some members citing the interests of students as their priority.

"Does the board want to commit to a tax exemption in addition to Georgia's $10,000 elderly exemption?" was Brown's take on the request previously put to the BOE by the self-named Bulloch County Senior Citizens group.

That does not mean a $10,000 tax reduction, but an exemption, available statewide, of $10,000 in the value of a home as assessed for taxes, which actually amounts to the first $25,000 of the home's fair market value.

This yields a $90.38 tax savings on the current school-funding property tax, for people 62 and older who meet income restrictions and apply for the exemption. It applies only to a primary residence where the qualifying individual or married couple lives more than half of the year.

Brown stated the eligibility age for this as 65, but the Georgia Department of Revenue website gives 62 as the minimum qualifying age for the school tax exemption. However, 65 is shown there as the qualifying age for a $4,000 exemption from all county property taxes, with citations to state laws giving the two different ages.

In his slideshow, Brown compared the school tax "elderly exemption" to the regular homestead exemption available to all homeowners, and used the example of a $100,000 home and attached land to compare the effects of individual's school taxes.

Because property in Georgia is assessed for taxes at 40% of market value, a $100,000 home has an assessed value of $40,000. The Bulloch County Board of Education's current 9.038 millage rate amounts to a $361.52 tax on that property, Brown noted.

 

Existing exemptions

Georgia has a basic homestead exemption of $2,000 assessed value, available to all homeowners for their primary residence. This exemption reduces the school tax on the example $100,000 (market value) property to $343.44.

The higher, $10,000 assessed value exemption from school tax is available to homeowners age 62 and up who have retirement income of no more than the exclusion set annually by the Social Security Administration, currently $68,644, and no more income from non-retirement sources, such as wages or rent, than $10,000 a year. This exemption would reduce the school tax on the $100,000 example property to $271.14, Brown calculated.

Property owners cannot "stack" these exemptions, but can sign up for only one or the other at a time, he said.

 

Only if you apply

The existing, statewide seniors' exemption is available in Bulloch County, but no one gets it automatically. It must be applied for specifically at the county Board of Tax Assessors office.

"All the exemptions are voluntarily applied for," Brown said. "You have to go in, seek out and do this. The tax assessor doesn't come knocking on your door saying, 'Hey, do you want to apply for this?'"

Once obtained, the exemption continues from year to year, but taxpayers have a duty to notify the assessors' office of changes in income or residence.

 

Sales tax maxed

Since some citizens and board members have commented about preferring sales tax to property tax, Brown also provided information about sales taxes. The Bulloch County Schools already receive the maximum share in local sales taxes legally available to any Georgia school system.

Bulloch is one of fewer than 10 Georgia counties where the permanent, regular 1% Local Option Sales Tax is dedicated to the school system instead of going to the county government and cities. This tax alone yields revenue equivalent to 5.34 mills property tax and is meant to reduce the millage rate by that much.

Additionally, the school system receives the 1% Education Special Purpose Local Option Sales Tax. Renewed by local voters every five years, it was previously used for new school buildings and renovations but is now being spent to a larger extent for technology, security equipment, books, school buses, playground equipment and athletic complexes.

 

1,300 properties

With this factual background, Brown presented the question whether the board wants to add a local exemption amount to the $10,000 assessed value statewide "elderly tax exemption" on school property tax. He did not suggest or mention any increase in the income eligibility limits.

Currently, about 1,300 properties in Bulloch County have the existing exemption applied to them, he said. The median fair market value of those properties is $107,000, and their median assessed value is $47,766, he reported on a slide.

Board members said they wanted to know how much various possible increases will cost in revenue. They asked for a list of pros and cons of an increase. Another of their questions was how much the small rollbacks of the school-funding millage rate the board has adopted in recent years to offset inflation in property values have totaled in forfeited revenue.

Brown said he intends to send board members answers to those questions within the next week.

For a local seniors exemption to go forward, it will have to be requested by the board and taken up by the Georgia General Assembly as county-specific legislation. That legislation would then call for a referendum, which would have be to approved by a majority of Bulloch County voters before the exemption could take effect.

 

Increased sign-up?

Brown and Wilson said they are concerned that increasing the amount of the exemption could prompt more taxpayers to sign up, making the actual effect on revenue hard to predict.

"I think this board could do nothing and that (count of) 1,300 exemptions would go up next year because of knowledge, because of being aware now," Brown said, noting the public exposure being given the topic.

On the reasoning that an increase will prompt more people to apply, Wilson suggested the board consider the reduction in revenue as potentially twice as high as calculated from the current 1,300 partly exempt properties. He also said he would want to inform referendum voters that the millage rate will probably be increased to make up for foregone revenue, and by how much.

 

BOE comments

"I feel like our role is to represent the children of our county, but I also think that my constituents should also have the opportunity to vote on the taxes that they pay, although I don't know that education would be the one that I would go after, because we all benefit from it," said District 4 BOE member April Newkirk.

BOE Chairman Mike Sparks, also the voting member from District 2 and a retired educator, expressed mixed feelings.

"I am conflicted on this because I am a senior citizen and a property owner, but I would like to see the figures for the economic ramifications on the Board of Education if we are to move forward with something like this," he said.

Wilson said he sees "somewhat competing moral values" in the community on this topic, between caring for the elderly and providing for education.

But he said the question does not relate to priorities in the school system's strategic plan and he does not know how much time he and the board should be willing to devote to it from now to December. That relates to the senior citizen group's desire to send the request to the state Legislature before it convenes in January.

 

 

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