A deal is in the works in Georgia to limit how much assessed home values can rise for tax purposes. The Senate Finance Committee approved a bill and state constitutional amendment that would cap increases in a home's value for property tax purposes at 3% per year, with an opt-out provision for local governments or school boards. Voters would need to approve the plan in a November referendum, and the limit would remain as long as owners maintain a homestead exemption.
Property taxes have become a significant concern for Georgia lawmakers, with complaints about rising bills alongside increasing home values. This issue is not unique to Georgia, as states like Texas, Kansas, Colorado, and Pennsylvania have also faced similar challenges.
The proposed cap has seen negotiations between the House and Senate, with the current compromise allowing local governments and school districts until March 1, 2025, to opt out. However, those that choose not to opt out would be subject to the cap thereafter.
Another proposal under consideration is to increase the statewide homestead tax exemption, with the House suggesting an increase from $2,000 to $10,000. This move could potentially save homeowners money on their tax bills, although its impact may vary across Georgia's counties due to existing local exemptions.
The valuation cap passed unanimously out of committee, but it will require bipartisan support on the House and Senate floors to meet the two-thirds threshold for approval. Negotiations between key figures in the legislature could also impact the fate of these measures.
Republicans in Georgia have long advocated for local governments to adjust tax rates to offset rising valuations, arguing that allowing bills to increase without rate adjustments amounts to a stealth tax hike. Many localities have used increased property values to boost employee salaries and cover rising expenses, raising concerns that a 3% cap could lead to tax rate hikes.
Overall, the push for property tax relief in Georgia reflects a broader trend across the country, as lawmakers grapple with balancing the needs of homeowners with the financial realities of local governments.
