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| HB 730 - Taxation; prop assess; education; local fair share funds computation |
First Reader Summary
A BILL to change the method of assessing property for taxation,
so as to provide for assessment according to 100 percent of fair
market value; to amend Part 4 of Article 6 of Chapter 2 of Title
20 of the Official Code of Georgia Annotated, relating to
financing of the "Quality Basic Education Act," so as to change
the method of computing local fair share funds and equalization
grants to reflect an increase in the assessed value of tangible
property; and for other purposes.
| House
| Action
| Senate
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| 2/24/97
| Read 1st Time
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| 2/25/97
| Read 2nd Time
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HB 730 LC 24 0737
A BILL TO BE ENTITLED
AN ACT
1- 1 To change the method of assessing property for taxation, so
1- 2 as to provide for assessment according to 100 percent of
1- 3 fair market value; to amend Part 4 of Article 6 of Chapter 2
1- 4 of Title 20 of the Official Code of Georgia Annotated,
1- 5 relating to financing of the "Quality Basic Education Act,"
1- 6 so as to change the method of computing local fair share
1- 7 funds and equalization grants to reflect an increase in the
1- 8 assessed value of tangible property; to amend Chapter 5 of
1- 9 Title 48 of the Official Code of Georgia Annotated, relating
1-10 to ad valorem taxation, so as to change the assessed value
1-11 of property; to make conforming amendments; to provide for a
1-12 proportionate increase in homestead exemptions; to provide
1-13 for related matters; to provide an effective date; to repeal
1-14 conflicting laws; and for other purposes.
1-15 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
1-16 SECTION 1.
1-17 Part 4 of Article 6 of Chapter 2 of Title 20 of the Official
1-18 Code of Georgia Annotated, relating to financing of the
1-19 "Quality Basic Education Act," is amended by striking Code
1-20 Section 20-2-164, relating to local fair share funds, and
1-21 inserting in lieu thereof a new Code Section 20-2-164 to
1-22 read as follows:
1-23 "20-2-164.
1-24 (a) The State Board of Education shall calculate the
1-25 amount of local fair share funds that each local school
1-26 system shall be required to spend each fiscal year to
1-27 support the Quality Basic Education Program as follows:
1-28 (1) Unless the combined fair share total for all local
1-29 school systems in the state, when calculated pursuant to
1-30 this paragraph, exceeds 20 percent of the sum of the
1-31 Quality Basic Education Formula amounts, as calculated
1-32 pursuant to subsection (d) of Code Section 20-2-161, the
1-33 amount of each local school system's local fair share
1-34 shall be calculated as follows:
-1-
2- 1 (A) Determine the most recent equalized adjusted
2- 2 school property tax digest for the local school system
2- 3 less the amount attributable to timber calculated
2- 4 pursuant to paragraph (1.1) of subsection (a) of Code
2- 5 Section 48-5-274, multiply the difference by .4, and
2- 6 add to that product the amount attributable to timber
2- 7 calculated pursuant to paragraph (1.1) of subsection
2- 8 (a) of Code Section 48-5-274;
2- 9 (B) From the amount calculated in subparagraph (A) of
2-10 this paragraph deduct the total amount calculated
2-11 pursuant to subsection (g) of this Code section; and
2-12 (C) Multiply the remainder calculated in subparagraph
2-13 (B) of this paragraph by .005. .002;or
2-14 (2) If the combined fair share total for all local
2-15 school systems in this state, when calculated pursuant
2-16 to paragraph (1) of this subsection, exceeds 20 percent
2-17 of the sum of the Quality Basic Education Formula
2-18 amounts, as calculated pursuant to subsection (d) of
2-19 Code Section 20-2-161, then the amount of each local
2-20 system's fair share shall be calculated as follows:
2-21 (A) Multiply the total amount of Quality Basic
2-22 Education Formula amounts to be expended for all local
2-23 school systems combined, as calculated for each local
2-24 school system pursuant to Code Section 20-2-161, by
2-25 .2;
2-26 (B) Divide the product calculated in subparagraph (A)
2-27 of this paragraph by the sum of the local fair share
2-28 amounts for all local school systems in this state as
2-29 calculated for each local school system pursuant to
2-30 subparagraph (C) of paragraph (1) of this subsection;
2-31 (C) Multiply the amount calculated in subparagraph (B)
2-32 of this paragraph by .005 .002; and
2-33 (D) Multiply the product calculated in subparagraph
2-34 (C) of this paragraph by the remainder calculated in
2-35 subparagraph (B) of paragraph (1) of this subsection.
2-36 (b)(1) Each local school system shall apply the total
2-37 amount of its local fair share funds to any combination
2-38 of programs funded under this article; provided,
2-39 however, that no portion of the local fair share funds
2-40 is applied to the financing of educational programs and
2-41 services operated at the option of the local school
2-42 system or for any grant program which explicitly
-2-
3- 1 excludes the application of local funds or which
3- 2 explicitly requires an application of local funds other
3- 3 than from the local fair share.
3- 4 (2) The local school system may apply revenues toward
3- 5 the local fair share from any source except: funds
3- 6 derived from the federal government which were not
3- 7 designed to replace local tax revenues; state funds;
3- 8 student tuition and fees; funds transferred from another
3- 9 local unit of administration; and other sources
3-10 specifically prohibited by provisions of this article;
3-11 provided, however, that an independent school system may
3-12 apply appropriations from the taxing authority of its
3-13 municipal government.
3-14 (c)(1) The state auditor shall furnish to the State
3-15 Board of Education the equalized adjusted school
3-16 property tax digests in accordance with Code Section
3-17 48-5-274.
3-18 (2) Except as provided in subsection (b) of Code Section
3-19 20-2-162, the sums of the most recent equalized adjusted
3-20 school property tax digests shall be used to make the
3-21 calculations required by subsection (a) of this Code
3-22 section for each fiscal year.
3-23 (d) Each municipality having an independent school system
3-24 and each county government shall annually provide the
3-25 Department of Revenue with the following information for
3-26 each local school system within its jurisdiction:
3-27 (1) The total number of granted state-wide
3-28 constitutional homestead exemptions for occupied homes
3-29 pursuant to Code Section 48-5-44 exclusive of those
3-30 homestead exemptions provided pursuant to Code Sections
3-31 48-5-47, 48-5-48, and 48-5-52;
3-32 (2) The total number of granted state-wide
3-33 constitutional homestead exemptions for disabled
3-34 veterans pursuant to Code Section 48-5-48;
3-35 (3) The amounts of tax and nontax revenues by source
3-36 which have been distributed by said local government to
3-37 local school systems for educational maintenance and
3-38 operation; provided, further, that if the total tax
3-39 revenues collected by a municipal government exceed the
3-40 amount of all revenues distributed to its school system,
3-41 the total amount of tax revenues collected by the
3-42 municipal government shall also be submitted to the
-3-
4- 1 Department of Revenue. Such data shall be submitted to
4- 2 the Department of Revenue no later than the date
4- 3 required for the submission of the local tax digests to
4- 4 the Department of Revenue; and
4- 5 (4) The difference between the actual assessed valuation
4- 6 of agricultural property and the valuation that would be
4- 7 assessed if all agricultural property were assessed at
4- 8 40 100 percent of its fair market value as provided in
4- 9 Code Section 48-5-7; provided, however, that if the
4-10 taxing authority of a local school system assesses
4-11 property at a legal standard other than 40 percent of
4-12 fair market value, the actual assessed valuation used in
4-13 this calculation shall be reduced to represent the
4-14 amount which would be assessed if the jurisdiction
4-15 assessed property at 40 percent of fair market value.
4-16 (e) The Department of Revenue shall annually verify,
4-17 certify as correct, and furnish the State Board of
4-18 Education with the following data for each local school
4-19 system by November 15:
4-20 (1) All tax and nontax revenues by source for the
4-21 preceding fiscal year which were distributed for
4-22 educational maintenance and operation; provided,
4-23 however, such tax and nontax revenues shall exclude any
4-24 state revenue collections which were previously
4-25 distributed to the state general fund and then
4-26 appropriated or allocated to local school systems; and
4-27 provided, further, that if the total tax revenues
4-28 collected by a municipal government exceed the amount of
4-29 all revenues which it distributed to its school system,
4-30 the total amount of revenues distributed to the school
4-31 system shall be designated as tax revenues in the report
4-32 of the Department of Revenue to the state board;
4-33 (2) The number of exemptions granted for state-wide
4-34 constitutional homestead exemptions for owner occupied
4-35 homes pursuant to Code Section 48-5-44, exclusive of
4-36 those homestead exemptions provided pursuant to Code
4-37 Sections 48-5-47, 48-5-48, and 48-5-52, for the
4-38 preceding calendar year;
4-39 (3) The number of exemptions granted for state-wide
4-40 constitutional homestead exemptions for disabled
4-41 veterans pursuant to Code Section 48-5-48 for the
4-42 preceding calendar year; and
-4-
5- 1 (4) The difference between the actual assessed valuation
5- 2 of agricultural property and the valuation that would be
5- 3 assessed if all agricultural property were assessed at
5- 4 40 100 percent of its fair market value as provided in
5- 5 Code Section 48-5-7, adjusted pursuant to paragraph (4)
5- 6 of subsection (d) of this Code section.
5- 7 (f) The Office of Planning and Budget shall annually
5- 8 furnish to the State Board of Education the estimated
5- 9 number of individuals age 65 or older residing in each
5-10 local school system and the estimated percent that such
5-11 individuals are of the total population for each local
5-12 school system. The Office of Planning and Budget shall
5-13 furnish all information requested by the General Assembly
5-14 regarding the procedure for estimating this percent.
5-15 (g) For purposes of calculation under this Code section
5-16 and Code Section 20-2-165, the equalized adjusted school
5-17 property tax digest, adjusted by paragraph (1) of
5-18 subsection (a) of this Code section, shall be reduced by
5-19 the sum of the following products:
5-20 (1) The product of the number of constitutional
5-21 homestead exemptions for owner occupied homes pursuant
5-22 to Code Section 48-5-44 granted for that year, exclusive
5-23 of those homestead exemptions provided pursuant to Code
5-24 Sections 48-5-47, 48-5-48, and 48-5-52, multiplied by
5-25 the amount per exemption authorized under Code Section
5-26 48-5-44; provided, further, that in any city operating
5-27 an independent school system which provides a homestead
5-28 exemption through local legislation comparable to that
5-29 provided in Code Section 48-5-44, the product calculated
5-30 in this paragraph shall represent the number of
5-31 homestead exemptions provided through the applicable
5-32 local legislation multiplied by the amount per exemption
5-33 authorized in Code Section 48-5-44, or by the amount per
5-34 exemption authorized in the applicable local
5-35 legislation, whichever is less; and provided, further,
5-36 that if the amount per exemption authorized in Code
5-37 Section 48-5-44 has been changed subsequent to the year
5-38 of the applicable digest, the more recently adopted
5-39 amount per exemption shall be used for the product
5-40 calculated in this paragraph;
5-41 (2) The product of the number of constitutional
5-42 homestead exemptions for disabled veterans pursuant to
5-43 Code Section 48-5-48 granted for that year, multiplied
5-44 by the amount per exemption authorized under that Code
-5-
6- 1 section; provided, further, that in any city operating
6- 2 an independent school system which provides a homestead
6- 3 exemption through local legislation comparable to that
6- 4 provided in Code Section 48-5-48, the product calculated
6- 5 in this paragraph shall represent the number of
6- 6 homestead exemptions provided through the applicable
6- 7 local legislation multiplied by the amount per exemption
6- 8 authorized in the applicable local legislation,
6- 9 whichever is less; and provided, further, that if the
6-10 amount per exemption authorized in Code Section 48-5-48
6-11 has been changed subsequent to the year of the
6-12 applicable digest, the more recently adopted amount per
6-13 exemption shall be used for the product calculated in
6-14 this paragraph;
6-15 (3) The product of the estimated number of persons age
6-16 65 or older residing in the local school system during
6-17 that year multiplied by 5,000;
6-18 (4) The product which results from the following
6-19 calculations:
6-20 (A) Subtract the estimated state-wide percentage that
6-21 persons age 65 or older is of the total population,
6-22 excluding military personnel and institutional
6-23 population, from the respective percentage for the
6-24 local school system. If the respective percentage for
6-25 the local school system is less than the state-wide
6-26 percentage, a difference of zero shall be used in the
6-27 calculations in this paragraph;
6-28 (B) Multiply the difference which results from
6-29 subparagraph (A) of this paragraph by 1,000; and
6-30 (C) Multiply the product which results from
6-31 subparagraph (B) of this paragraph by the estimated
6-32 number of persons age 65 or older residing in the
6-33 local school system during that year; and
6-34 (5) The product which results from the following
6-35 calculations calculation: (A) Divide divide the amount
6-36 reported in paragraph (4) of subsection (e) of this Code
6-37 section by the average ratio of assessed value to true
6-38 value used to calculate the most recent equalized
6-39 adjusted school property tax digest pursuant to Code
6-40 Section 48-5-274; and. (B) Multiply the quotient which results from
6-42 subparagraph (A) of this paragraph by .4.
-6-
7- 1 (h) In the event a local school system fails to provide
7- 2 for or to use the amount of local funds required to be
7- 3 raised and applied by the local school system toward the
7- 4 support of the Quality Basic Education Program as defined
7- 5 by this article during any fiscal year, the State Board of
7- 6 Education shall calculate the total amount of such funds
7- 7 and add that amount to the local fair share being required
7- 8 of the local school system for an ensuing fiscal year.
7- 9 Further, should the state auditor cite an audit exception
7-10 which requires that a local school system return an amount
7-11 of funds to the state general fund, the state board shall
7-12 add said amount to the local fair share of the local
7-13 school system for an ensuing fiscal year if the state
7-14 board has not been provided documentation that the amount
7-15 has already been paid to the state general fund. Such
7-16 additions will thereby reduce the amount of state funds
7-17 which shall be allotted to such local school systems. If
7-18 a local school system does not fulfill its obligation
7-19 relative to its assessed local fair share or any other
7-20 provisions of this article for any fiscal year, the state
7-21 board may withhold any portion or all of the state funds
7-22 to be allotted during the current or an ensuing fiscal
7-23 year."
7-24 SECTION 2.
7-25 Said part is further amended by striking Code Section
7-26 20-2-165, relating to equalization grants, annual
7-27 calculation, and allocation, and inserting in lieu thereof a
7-28 new Code Section 20-2-165 to read as follows:
7-29 "20-2-165.
7-30 (a) As used in this Code section, the term:
7-31 (1) 'Assessed valuation' is defined as 40 100 percent of
7-32 the equalized adjusted school property tax digest
7-33 reduced by the amount calculated pursuant to subsection
7-34 (g) of Code Section 20-2-164.
7-35 (2) 'Assessed valuation per weighted full-time
7-36 equivalent' is defined as the assessed valuation for the
7-37 most recent year available divided by the weighted
7-38 full-time equivalent for the year of the digest.
7-39 (3) 'Average weighted full-time equivalent count' is
7-40 defined as the first count of a fiscal year weighted two
7-41 parts and the second count weighted one part.
-7-
8- 1 (4) 'Effective millage rate' is defined as local tax
8- 2 revenues divided by the assessed valuation and
8- 3 multiplied by 1,000.
8- 4 (5) 'Eligible full-time equivalent program count' is
8- 5 defined as the sum of the full-time equivalent resident
8- 6 student count and full-time equivalent nonresident
8- 7 student count pursuant to subsection (b) of Code Section
8- 8 20-2-160 for each program specified pursuant to
8- 9 subsection (b) of Code Section 20-2-161; provided,
8-10 however, that each local school system's total full-time
8-11 equivalent nonresident student count for all programs
8-12 except handicapped programs shall not exceed the lesser
8-13 of the count for fiscal year 1986 or the count for any
8-14 ensuing fiscal year, unless the local school system
8-15 serves under contract all of the students in one or more
8-16 grade levels from an adjoining system or unless the
8-17 system serves students from an adjoining system under
8-18 court order.
8-19 (6) 'Equalized adjusted school property tax digest' is
8-20 defined as the most recent equalized adjusted school
8-21 property tax digest furnished to the State Board of
8-22 Education pursuant to paragraph (1) of subsection (c) of
8-23 Code Section 20-2-164.
8-24 (7) 'Guaranteed valuation school system' is defined as
8-25 the local school system ranking at the ninetieth
8-26 percentile in dollars of assessed valuation per weighted
8-27 full-time equivalent, where the ranking of school
8-28 systems is such that the one-hundredth percentile school
8-29 system is that with the highest amount in dollars of
8-30 assessed valuation per weighted full-time equivalent.
8-31 For the purpose of determining the assessed valuation
8-32 per weighted full-time equivalent of the guaranteed
8-33 valuation school system only, a reduction of the
8-34 assessed valuation for exemptions authorized by Code
8-35 Sections 48-5-44 and 48-5-48 shall be calculated whether
8-36 such exemptions are granted or not granted by the
8-37 guaranteed valuation school system.
8-38 (8) 'Local tax revenues' is defined as the sum of tax
8-39 revenues for a local school system as furnished to the
8-40 state board by the Department of Revenue pursuant to
8-41 subsection (e) of Code Section 20-2-164, reduced by the
8-42 total amount of general funds expended for capital
8-43 outlay or transferred into an escrow account for capital
8-44 outlay purposes for the most recent fiscal year such
-8-
9- 1 data are available and increased by any federal funds
9- 2 designed to replace local tax revenues provided to the
9- 3 said system; provided, however, that the local school
9- 4 system has furnished the state board with acceptable
9- 5 documentation which clearly identifies the source or
9- 6 sources of such federal funds.
9- 7 (9) 'Most recent average weighted full-time equivalent
9- 8 count' is defined as the average of the two most recent
9- 9 weighted full-time equivalent counts.
9-10 (10) 'Qualified local school system' is defined as any
9-11 local school system having an assessed valuation per
9-12 weighted full-time equivalent count for the year of the
9-13 digest ranking below the guaranteed valuation school
9-14 system and having an effective millage rate greater than
9-15 the millage rate applied to calculate the local fair
9-16 share pursuant to subsection (a) of Code Section
9-17 20-2-164.
9-18 (11) 'Weighted full-time equivalent count' is defined as
9-19 the sum of all eligible full-time equivalent program
9-20 counts multiplied by their respective program weights in
9-21 effect during the fiscal year that the full-time
9-22 equivalent counts were obtained pursuant to Code Section
9-23 20-2-161.
9-24 (12) 'Weighted full-time equivalent for the year of the
9-25 digest' is defined as the average of the two weighted
9-26 full-time equivalent counts taken during that fiscal
9-27 year beginning during the year of the digest.
9-28 (b) The State Board of Education shall annually calculate
9-29 the equalization grant for each qualified local school
9-30 system in the following manner:
9-31 (1) Subtract the assessed valuation per weighted
9-32 full-time equivalent for the local school system from
9-33 the assessed valuation per weighted full-time equivalent
9-34 for the guaranteed valuation school system;
9-35 (2) Divide the difference resulting from paragraph (1)
9-36 of this subsection by 1,000;
9-37 (3) Subtract five two from the effective millage rate
9-38 for the local school system and use the resulting number
9-39 of effective mills or 3.25 1.3 effective mills,
9-40 whichever is less, as the number of effective mills to
9-41 be equalized;
-9-
10- 1 (4) Multiply the quotient resulting from paragraph (2)
10- 2 of this subsection by the number of effective mills to
10- 3 be equalized pursuant to paragraph (3) of this
10- 4 subsection;
10- 5 (5) Multiply the product resulting from paragraph (4) of
10- 6 this subsection by the most recent average weighted
10- 7 full-time equivalent count for the local school system;
10- 8 and
10- 9 (6) The resulting amount shall be the equalization grant
10-10 for the ensuing fiscal year; provided, however, that for
10-11 each local school system which serves under contract all
10-12 of the students in one or more grade levels from an
10-13 adjoining system and for each local school system which
10-14 sends under contract all of the students in one or more
10-15 grade levels to an adjoining system, the equalization
10-16 grant shall be recalculated to represent the amount that
10-17 would be earned if the students transferred under said
10-18 contract were included in the full-time equivalent
10-19 counts of the local school system in which they reside;
10-20 provided, further, that any recalculated equalization
10-21 grant to be earned by a local school system sending
10-22 students to another system under the provisions of such
10-23 a contract shall be reduced by an amount which
10-24 represents the equalization funds earned per weighted
10-25 full-time equivalent student multiplied by the total
10-26 weighted full-time equivalent count for students
10-27 transferred, and any recalculated equalization grant to
10-28 be earned by the local school system receiving students
10-29 under said contract shall be increased by the same
10-30 amount. The amounts so recalculated shall be the
10-31 equalization grants for such local school systems. The
10-32 recalculations shall occur after the assessed valuation
10-33 per weighted full-time equivalent of the guaranteed
10-34 valuation school system has been calculated and shall
10-35 not affect the calculation of the assessed valuation per
10-36 weighted full-time equivalent of the guaranteed
10-37 valuation school system.
10-38 (c) The State Board of Education shall allocate
10-39 respectively the amount calculated under subsection (b) of
10-40 this Code section to each qualified local school system.
10-41 For the first effective year of the merger of any two or
10-42 more local school systems, the equalization grant shall be
10-43 the addition of amounts which would have been separately
10-44 earned by the systems participating in the merger or the
-10-
11- 1 amount which would have been earned if the systems had
11- 2 already been merged during the year of the applicable
11- 3 digest, whichever is greater. No portion of local fair
11- 4 share shall be applied to such equalization grants. In
11- 5 the event sufficient funds are not appropriated in a
11- 6 fiscal year to the state board to allot the full amount of
11- 7 equalization grants calculated to be payable to qualified
11- 8 local school systems as provided in this Code section, the
11- 9 state board shall proportionately reduce the amount of
11-10 funds to be allocated to qualified local school systems."
11-11 SECTION 3.
11-12 Chapter 5 of Title 48 of the Official Code of Georgia
11-13 Annotated, relating to ad valorem taxation, is amended by
11-14 striking Code Section 48-5-7, relating to assessment of
11-15 tangible property, and inserting in lieu thereof a new Code
11-16 Section 48-5-7 to read as follows:
11-17 "48-5-7.
11-18 (a) Except as otherwise provided in this Code section,
11-19 taxable tangible property shall be assessed at 40 100
11-20 percent of its fair market value and shall be taxed on a
11-21 levy made by each respective tax jurisdiction according to
11-22 40 100 percent of the property's fair market value.
11-23 (b) Tangible real property which is devoted to bona fide
11-24 agricultural purposes as defined in this chapter and which
11-25 otherwise conforms to the conditions and limitations
11-26 imposed in this chapter shall be assessed for ad valorem
11-27 property tax purposes at 75 percent of the its value which
11-28 other tangible real property is assessed and shall be
11-29 taxed on a levy made by each respective tax jurisdiction
11-30 according to said assessment.
11-31 (c) Tangible real property which qualifies as
11-32 rehabilitated historic property pursuant to the provisions
11-33 of Code Section 48-5-7.2 shall be assessed at 40 100
11-34 percent of its fair market value and shall be taxed on a
11-35 levy made by each respective tax jurisdiction according to
11-36 40 100 percent of the property's fair market value. For
11-37 the purposes of this subsection, the term 'fair market
11-38 value' shall mean the fair market value of rehabilitated
11-39 historic property pursuant to the provisions of
11-40 subparagraph (C) of paragraph (3) of Code Section 48-5-2.
11-41 (c.1) Tangible real property which qualifies as landmark
11-42 historic property pursuant to the provisions of Code
-11-
12- 1 Section 48-5-7.3 shall be assessed at 40 100 percent of
12- 2 its fair market value and shall be taxed on a levy made by
12- 3 each respective tax jurisdiction according to 40 100
12- 4 percent of the property's fair market value. For the
12- 5 purposes of this subsection, the term 'fair market value'
12- 6 shall mean the fair market value of landmark historic
12- 7 property pursuant to the provisions of subparagraph (D) of
12- 8 paragraph (3) of Code Section 48-5-2.
12- 9 (c.2) Tangible real property which is devoted to bona fide
12-10 conservation uses as defined in this chapter and which
12-11 otherwise conforms to the conditions and limitations
12-12 imposed in this chapter shall be assessed for property tax
12-13 purposes at 40 100 percent of its current use value and
12-14 shall be taxed on a levy made by each respective tax
12-15 jurisdiction according to 40 100 percent of the property's
12-16 current use value.
12-17 (c.3) Tangible real property located in a transitional
12-18 developing area which is devoted to bona fide residential
12-19 uses and which otherwise conforms to the conditions and
12-20 limitations imposed in this chapter for bona fide
12-21 residential transitional property shall be assessed for
12-22 property tax purposes at 40 100 percent of its current use
12-23 value and shall be taxed on a levy made by each respective
12-24 tax jurisdiction according to 40 100 percent of the
12-25 property's current use value.
12-26 (d) The requirement contained in this Code section that
12-27 all tax jurisdictions assess taxable tangible property at
12-28 40 percent of fair market value shall not apply to any tax
12-29 jurisdiction whose ratio of assessed value to fair market
12-30 value exceeded 40 percent for the tax year 1971. No tax
12-31 jurisdiction so exempted shall assess at a ratio of less
12-32 than 40 percent except as necessary to effect the
12-33 preferential assessment provided in subsection (b) of this
12-34 Code section.
12-35 (e)(d) Each notice of ad valorem taxes due sent to
12-36 taxpayers of counties and municipalities shall include
12-37 both the fair market value of the property of the taxpayer
12-38 which is subject to taxation and the assessed value of the
12-39 property after being reduced as provided by this Code
12-40 section by any applicable preferential assessment or any
12-41 applicable homestead exemption or both."
-12-
13- 1 SECTION 4.
13- 2 Said chapter is further amended by adding a new Code section
13- 3 to read as follows:
13- 4 "48-5-57.
13- 5 On and after January 1, 1998, the value of the total
13- 6 homestead exemptions applicable to a parcel of real
13- 7 property pursuant to any statute or constitutional
13- 8 provision taking effect prior to January 1, 1998, shall be
13- 9 increased by multiplying by a factor of 2.5. It is the
13-10 intent of this Code section not to grant any new homestead
13-11 exemption or to increase any homestead exemption, but
13-12 rather to preserve the value of existing homestead
13-13 exemptions in view of the increase of taxable assessed
13-14 value from 40 percent to 100 percent of fair market
13-15 value."
13-16 SECTION 5.
13-17 Said chapter is further amended by striking Code Section
13-18 48-5-274, relating to equalized adjusted school property tax
13-19 digests, and inserting in lieu thereof a new Code Section
13-20 48-5-274 to read as follows:
13-21 "48-5-274.
13-22 (a) The state auditor shall establish on a continuing
13-23 basis, no later than November 15 in each year, an
13-24 equalized adjusted school property tax digest for each
13-25 county in the state and for the state as a whole for the
13-26 current calendar year. All real and personal property
13-27 exempted from taxation for school purposes shall be
13-28 excluded from the digest. The state auditor may establish
13-29 a unit within the Department of Audits and Accounts
13-30 consisting of such number of personnel as is deemed
13-31 necessary in order to establish and maintain on a
13-32 continuing basis the equalized adjusted school property
13-33 tax digest. The equalized adjusted school property tax
13-34 digest shall be established and maintained as follows:
13-35 (1) Determine the locally assessed valuation of the
13-36 county property tax assessment digest for the preceding
13-37 calendar year, exclusive of real and personal property
13-38 exempted from taxation for school purposes and of
13-39 railroad equipment company property shown on the county
13-40 railroad equipment company property tax digest,
13-41 exclusive of any property subject to current use
13-42 valuation on the county property tax digest, and
-13-
14- 1 exclusive of the locally assessed valuation of timber
14- 2 harvested or sold;
14- 3 (1.1) Determine the locally assessed valuation for
14- 4 timber harvested or sold during the calendar year;
14- 5 (2) Divide the sum of the locally assessed valuation of
14- 6 the county property tax assessment digest under
14- 7 paragraph (1) of this subsection by the ratio of
14- 8 assessed value to true value of the property established
14- 9 by the state auditor in accordance with paragraph (5) of
14-10 this subsection;
14-11 (3) Determine the sum of the assessed valuation of the
14-12 county railroad equipment company property tax digest
14-13 for the preceding calendar year and divide such sum by
14-14 the equalization ratio for the year established by the
14-15 commissioner for the purpose of assessing railroad
14-16 equipment company properties throughout the state;
14-17 (3.1) Determine the sum of the assessed current use
14-18 valuation of the county property tax digest;
14-19 (4) The total of the sums obtained through the
14-20 calculations prescribed in paragraphs (1.1), (2), (3),
14-21 and (3.1) of this subsection shall be known as the
14-22 current equalized adjusted school property tax digest of
14-23 the county. The sum of the current equalized adjusted
14-24 school property tax digest of all counties of the state
14-25 combined shall be known as the current equalized
14-26 adjusted school property tax digest for the state as a
14-27 whole; and
14-28 (5) Establish for each county in the state the average
14-29 ratio of assessed value to true value of county property
14-30 subject to taxation for school purposes, excluding
14-31 railroad equipment company property. The ratio shall be
14-32 determined by establishing the ratio of assessed value
14-33 to sales price for a representative number of parcels of
14-34 real property title to which was transferred during a
14-35 preceding period of time, such period to be determined
14-36 by the state auditor, and by establishing the average
14-37 ratio of assessed value to sales price for the county as
14-38 a whole based upon a representative number of usable
14-39 transactions studied. The representative number of
14-40 parcels of real property used for the study shall not
14-41 include any parcel:
-14-
15- 1 (A) Title to which was transferred pursuant to the
15- 2 exercise of the power of eminent domain;
15- 3 (B) Title to which was transferred in a non-arm's
15- 4 length sale as defined by the Standard on
15- 5 Assessment-Ratio Studies published by the
15- 6 International Association of Assessing Officers or its
15- 7 successors; or
15- 8 (C) Title to which was transferred in a sale for
15- 9 investment or development purposes and whose sales
15-10 price is not reflective of current use of said
15-11 property.
15-12 No single parcel included in the study shall have a
15-13 sales price which exceeds 10 percent of the total sales
15-14 price of all parcels included in the study. The state
15-15 auditor shall supplement realty sales price data
15-16 available in any county with actual appraisals of a
15-17 representative number of parcels of farm property and
15-18 industrial and commercial property located within the
15-19 county, the title to which was not transferred within
15-20 the period of time determined by the state auditor. The
15-21 state auditor may make appraisals on other types of real
15-22 property located within the county when adequate
15-23 reliable sales data cannot be obtained on such property.
15-24 The state auditor shall use the same ratio for other
15-25 personal property, excluding motor vehicles, within the
15-26 county as is finally determined for real property within
15-27 the county.
15-28 (b) The average ratio of assessed value to true value of
15-29 county property to be established by the state auditor for
15-30 the purposes of paragraph (5) of subsection (a) of this
15-31 Code section shall be established through the use of
15-32 personnel of the Department of Audits and Accounts who
15-33 have sufficient competence and expertise by way of
15-34 education, training, and experience in the fields of
15-35 property evaluation and appraisal techniques. Personnel
15-36 of the Department of Audits and Accounts shall use the
15-37 Standard on Assessment-Ratio Studies published by the
15-38 International Association of Assessing Officers or its
15-39 successors to determine other unusable transactions and
15-40 the representative number of parcels and usable
15-41 transactions necessary to establish accurately the average
15-42 ratio described in paragraph (5) of subsection (a) of this
15-43 Code section.
-15-
16- 1 (c) The average ratio of assessed value to true value
16- 2 determined for each county shall be used as provided for
16- 3 in this Code section until such time as a new ratio is
16- 4 determined on a continuing basis for each county.
16- 5 (d) On or before November 15 of each year, the state
16- 6 auditor shall furnish to the State Board of Education the
16- 7 current equalized adjusted school property tax digest of
16- 8 each county in the state and the current equalized
16- 9 adjusted school property tax digest for the state as a
16-10 whole. In any county which has more than one school
16-11 system, the state auditor shall furnish the State Board of
16-12 Education a breakdown of the current county equalized
16-13 adjusted school property tax digest showing the amount of
16-14 the digest applicable to property located within each of
16-15 the school systems located within the county. At the same
16-16 time, the state auditor shall furnish the governing
16-17 authority of each county, the governing authority of each
16-18 municipality having an independent school system, the
16-19 local board of education of each school system, the tax
16-20 commissioner or tax collector of each county, and the
16-21 board of tax assessors of each county the current
16-22 equalized adjusted school property tax digest of the local
16-23 school system or systems, as the case may be, and the
16-24 current equalized adjusted school property tax digest for
16-25 the state as a whole.
16-26 (e)(1) Each county governing authority, each governing
16-27 authority of a municipality having an independent school
16-28 system, and each local board of education, when
16-29 aggrieved or when having an aggrieved constituent, shall
16-30 have a right, upon written request made within 30 days
16-31 after receipt of the digest information, to refer the
16-32 question of correctness of the current equalized
16-33 adjusted school property tax digest of the local school
16-34 system to the state auditor. The state auditor shall
16-35 take any steps necessary to make a determination of the
16-36 correctness of the digest and to notify all interested
16-37 parties of the determination within 45 days after
16-38 receiving the request questioning the correctness of the
16-39 digest.
16-40 (2)(A) If any party questioning the correctness of the
16-41 digest is dissatisfied with the determination made by
16-42 the state auditor pursuant to paragraph (1) of this
16-43 subsection, the party shall have the right, which must
16-44 be exercised within 15 days after being notified of
-16-
17- 1 the determination made by the state auditor, to refer
17- 2 in writing the question of the correctness of the
17- 3 digest to a board of arbitrators.
17- 4 (B) Each board of arbitrators shall consist of three
17- 5 members, one to be chosen by the state auditor within
17- 6 15 days after receipt of a written complaint, one to
17- 7 be chosen by the complaining party at the time of
17- 8 requesting the arbitration, and one to be chosen
17- 9 within 15 days after selection of the first two
17-10 members by the first two members of the board. In the
17-11 event the two arbitrators cannot agree on a third
17-12 member, the Chief Justice of the Supreme Court of
17-13 Georgia shall appoint the third member upon petition
17-14 of either party with notice to the opposing party.
17-15 (C) The board of arbitrators or a majority of the
17-16 board within 30 days after appointment of the full
17-17 board shall render its decision regarding the
17-18 correctness of the digest in question and, if
17-19 correction of the digest is required, regarding the
17-20 extent and manner in which the digest should be
17-21 corrected. The decision of the board shall be final.
17-22 (D) The state auditor shall correct the digest in
17-23 question in accordance with the decision of the board
17-24 of arbitrators and shall report the corrections to the
17-25 parties entitled to receive such information under
17-26 this Code section.
17-27 (E) Each member of the board of arbitrators shall take
17-28 and subscribe to an oath before the state auditor to
17-29 perform faithfully and impartially the duties required
17-30 in connection with the controversy concerning the
17-31 correctness of the digest in question and to render a
17-32 decision within the time required. Each member of the
17-33 board of arbitrators shall be paid a sum not to exceed
17-34 $250.00 per day for services rendered. All costs of
17-35 arbitration of matters arising under this Code section
17-36 shall be shared and paid equally by the Department of
17-37 Audits and Accounts and by the governing authority of
17-38 the local board of education requesting the
17-39 arbitration.
17-40 (3) Upon receiving notice that the current equalized
17-41 adjusted school property tax digest of any local school
17-42 system is being questioned pursuant to paragraph (1) of
17-43 this subsection, the state auditor shall notify the
-17-
18- 1 State Board of Education that the digest is being
18- 2 questioned. No computations shall be made on the basis
18- 3 of a questioned digest under Article 6 of Chapter 2 of
18- 4 Title 20, the 'Quality Basic Education Act,' until the
18- 5 digest has been corrected, if necessary, pursuant to
18- 6 this subsection.
18- 7 (f) The commissioner shall provide to the state auditor
18- 8 such digest information as is needed in the calculation of
18- 9 the equalized adjusted school property tax digests. Such
18-10 information shall be provided for each county and for each
18-11 local school system. For independent school systems in
18-12 municipalities authorized to assess property in excess of
18-13 40 percent of fair market value pursuant to Code Section
18-14 48-5-7, the commissioner shall provide digest information
18-15 to the state auditor at the assessment ratios utilized by
18-16 both the municipal government and the county government or
18-17 governments in which the municipality is located. If
18-18 revision is made to the digest of any county or any
18-19 portion of a county comprising a local school system
18-20 following the initial reporting of the digest to the state
18-21 auditor, the commissioner shall report any such revision
18-22 to the state auditor."
18-23 SECTION 6.
18-24 Said chapter is further amended by striking Code Section
18-25 48-5-341, relating to definitions relevant to examination of
18-26 county tax digests, and inserting in lieu thereof a new Code
18-27 Section 48-5-341 to read as follows:
18-28 "48-5-341.
18-29 As used in this article, the term:
18-30 (1) 'Assessment bias' means any tendency or trend of
18-31 assessment ratios, when analyzed by an appropriate
18-32 statistical method, which reveals assessment
18-33 progressivity or assessment regressivity.
18-34 (2) 'Assessment progressivity' means any systematic
18-35 pattern of assessment in which higher value properties
18-36 are generally assessed at a larger percentage of fair
18-37 market value than properties of lower value.
18-38 (3) 'Assessment ratio' means the fractional or numerical
18-39 relationship the assessed value of property bears to the
18-40 fair market value of the property.
-18-
19- 1 (4) 'Assessment regressivity' means any systematic
19- 2 pattern of assessment in which lower value properties
19- 3 are generally assessed at a larger percentage of fair
19- 4 market value than properties of higher value.
19- 5 (5) 'Assessment variance' means the absolute value of
19- 6 the difference between the assessment ratio for each
19- 7 parcel of property within each class of property and the
19- 8 average assessment ratio for that class and expressed as
19- 9 a percentage of the average assessment ratio.
19-10 (6) 'Class of property' means any reasonable divisions
19-11 of homogeneous groups of property that the commissioner
19-12 determines are necessary to examine digests for
19-13 uniformity and equalization.
19-14 (7) 'Digest evaluation cycle' means a recurring period
19-15 of three years beginning initially on January 1 of the
19-16 first year, as so designated by the commissioner for
19-17 each county, and ending on December 31 of the third year
19-18 thereafter.
19-19 (8) 'Digest review year' means the first year of each
19-20 evaluation cycle for each county."
19-21 SECTION 7.
19-22 Said chapter is further amended by striking Code Section
19-23 48-5-353, relating to fair market value and assessment of
19-24 property subject to both county and municipal taxation, and
19-25 inserting in lieu thereof a new Code Section 48-5-353 to
19-26 read as follows:
19-27 "48-5-353.
19-28 Except as otherwise provided in Code Section 48-5-7, the
19-29 board of tax assessors in each municipality which has such
19-30 a board pursuant to the municipal charter shall use as the
19-31 basis for fair market value of property subject to both
19-32 municipal and county ad valorem taxation the 100 percent
19-33 fair market value determined for the property for county
19-34 ad valorem taxation purposes before being reduced to the
19-35 40 percent assessed value required by law for county ad
19-36 valorem taxation purposes."
19-37 SECTION 8.
19-38 This Act shall become effective on January 1, 1998.
-19-
20- 1 SECTION 9.
20- 2 All laws and parts of laws in conflict with this Act are
20- 3 repealed.
-20-
Clerk of the House
Robert E. Rivers, Jr., Clerk
Last Updated on 04/20/98