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Tax Commissioner: Expect Property Tax Increase Of $200 To $300 In 2009

Tax Commissioner Kevin Payne says homeowners should brace themselves for additional property taxes this year and the next.

The state homestead tax relief grant, that funded an increased homestead exemption for homeowners since 1999, will not be available this year. Declining state revenues during the current recession means there is no money for the State to give the tax relief to homeowners said Payne.

This will mean a property tax increase of $200 to $300 on the 2009 tax bills for many Georgia homeowners.

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. Subsequently, the state would then reimburse local governments and schools for the amount of the credit.

For Floyd County, this amount equaled 4.6 million in 2008. 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% plus the rate of inflation.

Payne encourages homeowners to prepare for the increase now before tax bills are issued later this year.

Tax bills will be mailed in August with a due date of November 15th. “It’s unfortunate in slow economic times to have to deliver this message,” says Payne “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. It would be prudent to increase your escrow payment by $20-30 to cover the higher tax bill.

Some homeowners did receive a reduction in their property assessment this year, but this will most likely not be enough to off-set the increase due to the HTRG not being funded.

Additional legislation this year freezes property tax assessments at their current levels through 2011 unless there is a decrease in value or an improvement to the property. “I would like to add that although homeowners will see an increase in their property tax bills, local governments will not receive any extra money.

As a matter of fact, because of the decrease in values, local governments are most likely facing a budget shortfall this year compared to 2008”, stated Payne.

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