Thursday, June 26, 2014

Kennesaw hikes taxes 700 percent on blighted properties


Kennesaw approved a “blight tax” in April aimed at properties that are uninhabitable, unsafe, or have repeated illegal activity. The logic behind the property tax increase is that it costs the city more to perform services such as public safety and code enforcement at blighted properties. The Marietta Daily Journal reports:
KENNESAW — No residents spoke either for or against a proposed blight tax by the city of Kennesaw at two public hearings, resulting in an unanimous approval of the program Monday night. The program establishes a procedure to identify blighted structures and sets an increased rate of property tax at seven times the normal millage rate. The increase would be applied to the next tax bill cycle, which begins Oct. 1 of each year. After the vote, City Manager Steve Kennedy said Kennesaw residents understand the city should have an additional tool to address unsightly concerns, even though no actual properties were pinpointed during the council discussions as fitting the description “blighted.”
It's an interesting idea although the potential tax rate seems very steep, and may open the door to legal challenges if the ordinance is ever enforced.  11 Alive reports that Kennesaw’s new ordinance is “patterned after similar ordinances in other local governments in Georgia.”…


Thursday, June 19, 2014

Part of HB 755 gets mixed reviews from tax officials


When a property is under appeal in Georgia, the property owner is generally billed for property taxes at 85 percent of the current year value. Last year, legislation was enacted that allowed the taxpayer to pay based on the 100 percent value if they preferred. House Bill 755, which was signed into law by Gov. Deal last month, includes further adjustments to the temporary value statute used for billing properties under appeal, with six different possible scenarios for determining the correct temporary value to use for billing based on the value of the property, whether or not improvements have been made to the property, and whether or not the property has been homesteaded.

Non-homestead properties valued at less than $2 million and homesteaded properties with no new improvements made to the property would pay 1) the 85 percent value or 2) the most recent final, settled value, whichever is less. 3) Homestead properties with new improvements would be billed at 85 percent. Non-homestead properties with proposed values greater than $2 million could pay 4) 85 percent of the proposed value, 5) 100 percent of the current year value, or 6) “the difference between the 85 percent tax bill based on the current year's valuation and the tax bill based on the valuation from the last year for which taxes were finally determined to be due on the property in conjunction with the amount of the tax bill based on valuation from the last year for which taxes were finally determined to be due on the property.”

When these different scenarios in the legislation were presented to the Georgia Association of Tax Officials at their annual conference in Athens last month, the response was unenthusiastic. During her presentation of legislative updates, Vicki Lambert, director of the Local Government Services Division (overseeing property and ad valorem taxation) of the Georgia Department of Revenue, said that the 6th possible calculation (referencing the difference between the values over two years) is too confusing to understand or explain.

Some county tax officials indicated that they would continue using 85 percent as their standard temporary value for most properties under appeal, but that they would include language on the bill or other printed materials describing the different possible values.

For the City of Decatur, we would base our bills on whatever value DeKalb County informs us is the temporary value—whether that is the 85 percent value or some other temporary amount dictated by law—and then adjust it by the same factor that we use to increase DeKalb’s 40 percent assessment to City’s 50 percent assessment (ie, 50 percent of the 85 percent value, or 50 percent of whichever value applies by law).

There are probably valid reasons for carving out all these different possible temporary values under the law, but it is a challenge to implement and communicate this clearly to taxpayers under appeal. Appealing your property value is already complicated enough without having multiple possible methods for calculating an accurate temporary value.

Tuesday, June 17, 2014

Decatur presents tips for maximizing revenues at national conference

Each attorney practicing law in Decatur is responsible for paying a $425 annual occupation tax to the City. Historically, our collection rate for this group has been low, and in 2012 we began taking steps to improve collections.

Over a one year period we were able to boost tax compliance for this group from 69 percent up to an 86 percent. We used performance measurements to identify the opportunity for growth and implemented process improvements to get there. After that experience we described our efforts in a case study submitted to the Alliance for Innovation, and the topic was selected for presentation during their Transforming Local Government 2014 conference in Denver, Colorado.

I had the pleasure of making the presentation in April along with communications chief Linda Harris, city manager Peggy Merriss, and revenue supervisor Shaun Shabazz. After presenting our experiences Linda conducted an interactive session called “The Dog Ate My Tax Bill” to help attendees brainstorm different ways to overcome nonpayment of taxes or other revenues.

It was a lot of fun, and as Peggy noted afterward, those who attended our session were very engaged. Thanks to her, Linda, Shaun, our city attorney Bryan Downs, and the folks at TLG including Brandi Allen who all helped make it a success!

Our case study doesn’t seem to be available yet on the conference archive, but here’s the PowerPoint I presented. This is useful information for local governments and businesses that are trying to collect on difficult accounts:


Thursday, June 12, 2014

5 days until key tax deadline passes


Although property tax payments were due in Decatur on June 2, the City has offered a grace period until June 16 during which no penalties or interest will be applied to unpaid accounts. That grace period expires on Monday.

A 10 percent penalty and 1 percent interest per month will be applied to amounts that remain unpaid after June 16.

Over the last few years we’ve observed that about 80 percent of taxes are paid by the initial deadline in early June, with another 15 percent of property owners taking advantage of the two-week grace period.

Tuesday, June 10, 2014

City shares tax info during annexation meeting

City staff [from left, Andrea Arnold, Russ Madison, and Shaun Shabazz] discuss taxes and homestead exemptions with Parkwood resident during recent Q&A session

School and City staff from all departments including Administrative Services and the Revenue Division discussed property taxes and homestead exemptions with residents from Parkwood neighborhood during a Jun. 5 meeting at City Hall.

Although Parkwood’s annexation will become effective July 1, 2014, residents in the area will receive their normal tax bill in the fall from DeKalb County and no tax bill from Decatur in 2014.  Property taxes are always based on the status of the property as of January 1, and as of that date the homes were still in unincorporated DeKalb.

Parkwood residents will receive their first tax bill from Decatur in April 2015 during our 1st installment 2015 billing.  We do not send individual bills to mortgage companies, so property owners should forward the bills to their lenders if paying taxes out of escrow.

I prepared a table showing how taxes may look over the next 18 months for these homeowners based on a few different property values in the neighborhood.  These estimates assume current millage rates, fees, steady property values, and a basic homestead exemption with the City and County.

100% County value
DeKalb 2014 bill
Decatur 1st install 2015 bill
Decatur 2nd install 2015 bill
DeKalb 2015 bill
$230,000
$3,000
$2,145
$1,835
$350
$350,000
$4,580
$3,160
$2,855
$550
$450,800
$5,890
$4,015
$3,705
$725

For a more precise estimate, tax calculators are available on this blog and at www.decaturga.com under “What’s New,” then “Annexation.”

Homestead exemptions are applied for separately with the County and the City.  Exemptions only have to be applied for once, and they renew automatically as long as there are no changes in ownership.  The Parkwood residents should apply for their exemption with the City prior to Mar. 15. 2015.  Our office will send a letter to the neighborhood explaining how Decatur’s exemptions work.

The last item that these new residents may need to know from our office is that any individuals with a home-based business would need to obtain a business license from the City pro-rated this year for $110, and $195 annually after that.

Thursday, June 5, 2014

Quick note about DeKalb’s assessment notices


The assessment notices that DeKalb County recently sent to property owners say “City Exemptions May Not be Included in this Estimate” at the bottom of the notice. This doesn’t mean that you don’t have a homestead exemption with the City of Decatur. What it means is that DeKalb does not factor in what City exemptions you have when preparing the estimate.

If you’re not sure whether you have your homestead exemption with the City, you can look at your 2014 1st installment tax bill. If you have the basic homestead exemption, your savings from that exemption will be printed just above the tear-off line of the remittance coupon. Also, look at the exemptions column of your tax bill. You have the basic homestead exemption if a figure of $20,000 appears in the exemptions column on three rows of your bill. If you have all zeroes in the exemptions column, you do not have the basic homestead exemption.

You can also call our office at 404-370-4100 to confirm what exemptions you have.

Monday, June 2, 2014

Property tax payment deadline today


Property tax payments for Decatur's first installment of 2014 are due today. We honor postmarks, so as long as you get your payment in the mail today, no penalties or interest will apply. Payments are also accepted by credit card online with a convenience fee charged by our third party payment processor.

Commercial sanitation payments are also due today in order to maintain service.

Friday, May 2, 2014

New law takes aim at tax digests with big appeals


On Tuesday, Gov. Deal signed House Bill 755, a piece of legislation labeled somewhat misleadingly as a forest land market value bill.

HB 755 addresses several issues beyond forest land, including property values and taxation of all real property in Georgia. The law: 1) specifies what portion of taxes are due in cases of pending superior court litigation, 2) prohibits the approval of county tax digests by the commissioner of the state Department of Revenue when more than 5 percent of the assessed value in the digest is under appeal or arbitration, and 3) makes revisions to refunds and interest schedules in cases of over- and under-payment due to settled appeals.

The provision on digest approval essentially revives language (which had a lower threshold amount of 3 percent) that was purged from state law in 2010.

The governor also signed HB 954 on Tuesday which affects a narrower range of values for properties with rent controls or that are eligible for income tax credits.

Wednesday, April 9, 2014

Legislative update on property tax assessments


Of the half dozen bills affecting property taxes that were still being considered by the Georgia General Assembly during the final days of its 2014 legislative session, only one bill ended up passing both chambers.

House Bill 954 adds some criteria to the calculation of fair market value by tax assessors; specifically, "Rent limitations, operational requirements, and any other restrictions imposed upon the property in connection with the property being eligible for any income tax credits" would be factored into assessments going forward.

The legislation would probably only affect the assessment of certain multi-family dwellings such as rent-controlled or government-subsidized housing units.  The original House bill was slightly amended by the state Senate before final passage to clarify that such property shall not be considered as comparable for assessments and appeals.  (My interpretation of that amendment is that, for example, the owner of a non-rent controlled apartment complex can't use the value of a rent-controlled apartment complex as a comparable property to justify an appeal.)

The bill still needs to be signed by Gov. Deal before it becomes law.  Even if he approves it, I would expect little if any change to Decatur's total tax digest value from this extremely narrow measure.

Wednesday, April 2, 2014

Decatur property tax bills online


Decatur's property tax bills for the first installment of 2014 are now online at www.decaturgatax.com. We mailed paper bills last week. If you did not receive your bill in the mail, you can access it online, or call us at 404-370-4100 for us to resend your bill.

Payments can also be made online with a convenience fee equalling 30 cents plus 2.2 percent of the total charges. Payments are processed by PayPal, but you do not have to have a PayPal account to pay online. PayPal will give you the option to select "Don’t have a PayPal account?"  Then you can enter your information and pay by Visa, Mastercard, Discover, or American Express. 

Property tax records in Decatur are available online going back to 2009.

If you prefer to mail in your payment, please use the return envelope we enclosed with your bill and include the tear-off remittance coupon with your check. Or just stop by City Hall--we'd like to see you!

Saturday, March 15, 2014

Special hours at City Hall--Saturday, March 15


The City of Decatur Revenue Division and the City Manager’s Office will be open today (Saturday), March 15, 9 a.m.-2 p.m., to serve community members who are unable to stop by during the regular workweek. If you want to apply for a homestead exemption, pay a bill, handle a business license matter, or have other needs that could be met by these offices during this time, come to City Hall, 509 N. McDonough St., or call 404-370-4100.