Wednesday, September 10, 2003
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Wednesday, September 10, 2003 |
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Schools, PTC push tax rates up By J. FRANK LYNCH
Playing with fire. That's how some might observe the financing plans Fayette County's "taxing authorities" have set in place for the year ahead. After years of seemingly endless economic growth, the county's development has slowed to a pace more manageable, some might say. But the growth years spoiled the budget writers, who got in the habit of assuming revenue projections nearly always fell on the shy side of reality. Windfalls are a thing of the past. Last week, Tax Commissioner George Wingo released the county's revised tax digest for the year, a voluminous document that purports to show the value of every piece of privately held real estate, every motor vehicle, every golf cart and whatever else is deemed "taxable" by the law. Net worth for Fayette County: $11.3 billion in taxable assets. Estimated retail sales this year in Fayette County: $1.6 billion. That doesn't necessarily translate into instant revenue for Georgia's wealthiest county, however. Nobody knows that better than James Stephens, comptroller for the Fayette County Board of Education. Last week, it was Stephens' duty to inform the five members of the Board of Education that a $148 million operations budget approved in June wasn't going to balance out. The problem? More cuts in funding from the state, plus a lower than anticipated rate of growth in the county tax digest. The solution? Raise the millage rate charged to county homeowners by 1.219 mills, or 12.29 percent. A rollback in the portion of the millage applied to bond indebtedness, however, will make the net increase to homeowners 1 mill, or about $80 more to the owner of a $200,000 home. The taxation rate charged by the school district is pushing dangerously close to the legal limit. And still, it may not be enough, Stephens concedes. This month, the school district will borrow money to make the payroll, not an unusual move, due to the ebb and flow of tax revenue, but unnerving coming so early in the school year. And with the promise of a midyear "austerity" adjustment in state funding in doubt, Fayette County's teachers will likely go without a 1 percent pay raise expected in January. A freeze on all non-instructional related spending is on the table and ready to implement if need be, said Stephens, a military veteran with a no-nonsense, by-the-book style of ledger management. Things look tough, but it could be worse. "People here want good schools and good schools cost," said Stephens. "That's what we're finding out." GOOD SCHOOLS COST Indeed, with the proposed millage increase, Fayette County widens the gap as the metro Atlanta community with the highest school taxes. Not too long ago, the reverse was true. Fayette's total proposed combined millage rate of 22.694 is topped only by DeKalb County's 22.980, according to a survey of metro Atlanta school districts compiled recently by the Cobb County School District. But the impact on DeKalb homeowners is lessened significantly because of a $10,000 homestead exemption in the state's second most populous county. Fayette's homestead exemption is among the lowest in the region, at $2,000. The amount of school taxes paid by the owner of a $150,000 home in Fayette County, according to the survey, is about $1,310. In DeKalb, where the millage is actually higher, it is just $1,149. On the low end of the tax scale, owners of a similar home in Forsyth County pay just $940.18 a year in school taxes, where a $7,000 homestead exemption applies. In Clayton County, where there is no millage on bonds to fund facilities, homeowners are charged just $948 a year. Even in the city of Atlanta, where it is assumed taxes are taken and services never rendered, owners of a $150,000 home pay under $1,000 a year in school tax. The difference, again, is a homestead exemption, this time to the tune of $15,000. In other words, the bargain educational system Fayette Countians used to brag about is no more. And Stephens is wringing his hands trying to figure out how to adjust to another 5 percent in state funding cuts already announced for the 2005 budget. Twice in recent years, Fayette voters have defeated SPLOST referendums that would have funded capital improvements and relieved pressure on the millage rate. While school system facilities planners say more new schools will be needed starting in a couple of years, serious discussion about how best to finance the next wave of construction hasn't really begun, at least not in public. The Board of Education, playing it safe, will probably lean to another bond referendum in November 2004, and that will mean still higher taxes. PENNIES ADD UP In Peachtree City, sales tax revenue has played a different role. Last week, a divided Peachtree City Council set the city's 2004 budget, voting 3-2 to accept the $27.9 million plan and raise property taxes by an effective 17.4 percent. The culprit, city leaders insist, is a redistribution of the county's 1-cent LOST that left the city shorthanded. Beyond that, the city is raising taxes at double-digit rates while adding just one new employee citywide and slashing spending across all departments. The only true consolation: Employees will receive a 2 percent cost of living adjustment in their paychecks, come October. Councilman Dan Tennant, a loud critic of the city's intentions to raise taxes instead of cutting spending or personnel, was against the plan. He was joined by Councilman Annie McMenamin, who gave no indication prior to the meeting that she opposed the budget or the millage rate increase. Mayor Steve Brown and councilmen Murray Weed and Steve Rapson gave their approval, as expected. The actual millage rate will increase from 4.703 to 5.283, or .580 mills, city officials say. Though it represents only a 12.3 percent increase in the millage rate, state law requires governments to announce the percent increase over the rollback millage rate, if property values increase. The rollback millage rate was calculated to be 4.50 after revaluations by the county tax assessor's office this year. Though it's the leanest budget in city history, it's not lean enough for Tennant, running on a "no higher taxes" mantra.
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