Tax Commissioner Sharon Troglin says homeowners should brace now for additional property taxes this year and the following year, due to the lack of state funding for Georgia’s homestead tax relief grant.
Troglin said homeowners in Pickens County will see an increase of around $160 resulting from the state cut. The tax increase is independent of anything the county or school board may do when setting their tax rates.
The state homestead tax relief grant that funded an increased homestead exemption for the last several years will not be available this year, and it will result in higher tax bills for those who had previously taken advantage of the exemption.
Declining state revenues during the current recession mean there is no money for the state to allow homeowners this exemption, said Troglin.
She said the exemption was started by Governor Roy Barnes in 1999 and has been reducing property tax bills every year since. State funds involved compensated counties for the revenue loss brought on by lower bills.
“The funds have just dwindled down to the point that the state can’t do it anymore,” Troglin said. She noted this is a statewide decision, not a change created locally.
Troglin projected that every person in Pickens County who previously received the state homestead exemption will see a tax bill around $160 higher. Statewide it’s projected the average bill will increase by around $200.
She said the exemption knocked a flat amount off the tax bills of homeowners, an amount not dependant on the tax value of the home. And without the grant, some homeowners whose bills were low will see a huge percentage increase.
“That’s why I want to let people know this now, so they can make arrangements and begin putting some [money] back to pay this,” she said.
The grant appropriated by the General Assembly and the governor for the last several years to counties, cities and schools had given tax relief to homeowners in the form of a credit on their tax bills. According to legislation passed this year (House Bill 143), the grant will only be made available in the future if state revenues grow at least 3 percent plus the rate of inflation.
Troglin encourages homeowners to prepare for the increase now before tax bills are issued later this year. She said technically tax information should be presented to the state so that tax bills come due in the fall. But Pickens often misses this deadline, and bills are mailed in the fall with a pay-by-January due date.
Troglin said her office is working with mortgage companies to make sure they are aware of this change, as it affects escrow costs for paying home taxes out of the mortgage payment. But homeowners may want to confirm their mortgage holder is making the changes necessary to handle the extra tax amounts.
“It’s unfortunate in slow economic times to have to deliver this message, but homeowners need to know now, so they can plan accordingly with their household budgets or make sure that tax escrows are properly funded with their mortgage companies to handle the tax increase,” she said.
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