Reminder: homestead exemption deadline nears

The deadline to file for a homestead exemption with the City of Decatur is Monday, March 1. If you applied in a prior year, you do not need to file again. But if you’ve never applied, or if you’ve only applied with DeKalb County, you need to apply with the City. If you miss the Monday deadline, you won’t be able to receive the homestead exemption until 2011.

You can apply for the basic homestead exemption through our online form here.

For more details about homestead exemptions, see our main webpage or look over my recent post on the subject.

Does this appeal to you?

As discussed here yesterday, if you are a Decatur property owner and you intend to appeal your property value this year, you may file a return with DeKalb County by March 1. This explanation appears on the DeKalb County Tax Commissioner’s website:

If you wish to appeal the value of your property, you may file a tax return with the Property Appraisal Department between January 2nd and March 1st, at which time you may declare what you consider to be the fair market value of the property.

This will generate a review of the value by the Property Appraisal Department; a notice of assessment change will be sent to you in late March or early April if the Board disagrees with your value.

Under current state law, you will have thirty days after the county sends you back a notice of assessment change to formally file an appeal if you disagree with the notice.  If you need more information, the DeKalb County property appraisal office can be reached at (404) 371-0841.

(Note: SB 346, currently under review in the Georgia General Assembly, would extend that 30-day deadline a one-year deadline, although this is one of the more controversial aspects of the legislation and may not survive the Senate Finance Committee.)

Two tax offices?

Property owners in Decatur owe property taxes to two entities: to DeKalb County and to the City of Decatur. Your city property tax payments fund the operations of city government (including police, fire, public works, and other services) and the City of Decatur school system.

Dealing with both the county and the city on property tax issues can be confusing for new residents. Homebuyers sometimes report to us that they only knew about the county’s tax bill or that they only knew about the city’s tax bill. Some are quite surprised to get two bills! (Or actually three tax statements since the City bills in two installments.) Real estate agents and closing attorneys who let their clients know about this dual-billing up front can help prevent disputes later on about who set aside how much for taxes at closing.

Separate tax authorities also means that homestead exemptions are filed separately. As I’ve noted before, new owners that reside in their homes (not for investment or commercial property) need to file for homestead exemption once with both the DeKalb County Tax Commissioner and with the City of Decatur Revenue Division.

We do not have separate appraisal departments. DeKalb County determines all the fair market value for properties in the county, including properties within the city limits of Decatur. We receive those values from DeKalb County in an annual property tax digest. We have no discretion to change values established by the county. By our ordinances, the City applies an assessment of 50 percent to the fair market values established by the County (while Georgia counties use a 40 percent assessment for their own billing). Appeals can only be filed with DeKalb County.

If DeKalb County reassesses your property, they will forward the new values to our office. You will be re-billed or your new value will be reflected on your second installment city bill depending on when we receive the updated value from the County. Either way your overall tax liability for the year will be based off of the new assessed value.

To summarize:

Frequently asked owner questions	Decatur or Dekalb?
Who determines my property value?	DeKalb County
Where do I file for homestead exemption?	City of Decatur and DeKalb County separately
Who handles property appeals/reassessments?	DeKalb County
Who bills for property taxes?	City of Decatur and DeKalb County separately

When in doubt, give us a call and we'll be happy to steer you in the right direction!

Georgia tax news roundup

Last night, Georgia Public Broadcasting’s Valerie Edwards reported that “A Senate proposal to revise how property taxes are assessed was withdrawn pending February revenue numbers.” (See this “Lawmakers” video about one-quarter of the way through). The broadcast did not specify whether the bill withdrawn was SB 346 or another property tax measure (although I don’t know of any other property tax bills in the Senate right now). I called the Secretary of the Senate’s office to confirm, but they said that SB 346 was still listed in their paperwork as “in committee.” If the GPB report is true, this would be a surprising reversal from state legislators.

In other news, today’s AJC raises concerns that metro-Atlanta property assessors have overvalued homes in the region.

This morning, WSB’s Clark Howard has written up several tips on appealing your property assessment. As a reminder, property appeals in Decatur are handled by DeKalb County and must be filed with them by March 1.

Lastly, new efforts underway in the Georgia General Assembly may lead to higher occupational tax collections. In an attempt to increase plummeting sales tax revenues, state legislators are moving toward requiring the state Department of Revenue to share sales tax certificate information with local jurisdictions in exchange for local information about which businesses have licenses. The idea is that the information sharing would lead to detection of businesses that are not paying their sales taxes or occupational sales taxes.

Taxes and fees? Part II

Stormwater fees

When it comes to City stormwater fees, everybody pays. Even tax-exempt property such as churches, DeKalb County property, and MARTA are required to pay stormwater fees to the City of Decatur. Even the City of Decatur pays stormwater fees to itself for the roads and other City-owned property!

But how are stormwater fees calculated? The stormwater fee for 2009 was $75 per “ERU”—an acronym that refers to the quantity or amount of impervious surface at your property. Impervious surface such as pavement leads to run-off that has to be drained by the City’s stormwater infrastructure. A single-family dwelling is “assessed” at a quantity of 1 ERU. Larger properties are charged a proportionately increasing ERU figure. For example, an office building with a parking deck may have more than 50 ERUs.

To see how many stormwater units you are paying for, look at this portion of your last tax bill:

For questions about the City’s stormwater policies, please contact the City’s Stormwater Utility.

Taxes and fees?! A two-part series

In addition to your property tax, most owners in Decatur have two additional fees on their accounts every year: residential sanitation (trash pick-up) and stormwater (for drainage).

Part I: Sanitation

Most residential properties have one sanitation charge, which for 2009 was $225. Condo associations or multi-family dwellings may have arranged their own commercial sanitation service separately, in which case no residential charges should appear on your account. Dwellings such as duplexes or homes with carriage houses should have two sanitation charges (for a total of $450). You can double-check how many units you are being charged for by looking at your last tax bill:

If you have general questions about trash pick-ups or about how the City arrived at $225 as the current annual fee, please contact our Public Works Department at 404-377-5571. If you have a question specifically about your sanitation payment or the arithmetic on your tax bill, please contact the Revenue Division.

My next post will focus on stormwater fees.

Property ownership for Decatur couples

What could be more romantic this weekend than using some of Catherine’s Valentine’s ideas and having a nice, romantic conversation about joint property ownership arrangements over dinner?

I’ve done some research on how many properties in Decatur have more than one owner, but before addressing that, I’ll give some background on co-ownership options.

If you own your home with another person using joint tenancy with right of survivorship, that means that if you die, your spouse or partner automatically inherits your property. Georgia property law says that to create an arrangement like that, the deed must refer to the co-owners “as ‘joint tenants,’ ‘joint tenants and not as tenants in common,’ or ‘joint tenants with survivorship’ or as taking ‘jointly with survivorship’” (O.C.G.A. §44-6-190).

Tenancy in common, on the other hand, means that the co-owner wouldn’t automatically inherit the property: the property would go to the deceased owner’s heirs, and that process would go through probate. Georgia law says, “a tenancy in common is created wherever from any cause two or more persons are entitled to the simultaneous possession of any property. Tenants in common may have unequal shares” (O.C.G.A. §44-6-120).

Obviously, there are also cases where only one of the spouses or partners own the home, and only one name appears on the deed.

Now for the numbers. Deeds are filed with the DeKalb County, and property data is transmitted by the DeKalb County Tax Commissioner annually to us in the City of Decatur. Based on that digest we receive, there were 7,002 residential properties in the City of Decatur in 2009. Of those, 3,441 properties are listed as having more than one owner, or 49 percent of homes.

Of those 3,441, there are 1,904 owners listed using the word “OR,” (for example, "SMITH JOHN OR SMITH JANE) suggesting tenancy in common. There are 235 properties using the letters “JT” (e.g., SMITH JOHN JT JANE SMITH JT) signifying joint tenancy with survivorship. The remaining 1,302 just list both names.  Mind you, these numbers are based on the information I receive in the tax digest, and on tax bills we only print the first name listed.  The DeKalb County Clerk of Superior Court can verify whether two names are actually on the deed and what type of ownership arrangement was recorded.

If you’re concerned about the type of ownership you share, I would encourage you to talk it over with your loved one, seek the advice of an attorney if you’re making a change, and check with DeKalb County for filing procedures.

State Senate considers property tax changes

As expected, state senator Chip Rogers and five co-sponsors introduced Senate Bill 346 last Monday, which would allow property owners to appeal their values at any time, and would require assessment notices to be sent to property owners annually.

The full text of the proposed legislation is available here, and the Atlanta Journal-Constitution has provided these good bullet points summarizing the highlights of the bill:

• Year-round property appeals.
• Making sure that every property receives an annual notice of assessment.
• Statewide uniformity of assessment notices and appeal forms.
• Allowing counties to accept payment plans for property taxes and discounts for early payments.
• Establishing time limits for assessor action in response to appeals.
• Requiring a unanimous vote by Board of Equalization members to increase assessed value.

The bill has already met some resistance, but given the clout of the senators already supporting it, some version of “assessment reform” appears likely to pass during this legislative session.

In other state property tax news, the Department of Revenue has proposed new rules for calculating conservation use assessment values.

Tax & beer news before the big game

I love the subheading--“An assessment battle brewing in Fort Collins.” The Reporter-Herald reports that beverage giant Anheuser-Busch is appealing its property tax assessment in Colorado. For tax geeks and football fans, this story may whet your whistle before Sunday:

FORT COLLINS — Anheuser-Busch is challenging its property tax assessment for the plant just outside of Fort Collins.

If a state panel agrees with the company, Larimer County stands to lose $1 million per year in tax money.

Larimer County Commissioner Steve Johnson took exception to the company claim that the county’s $90 million valuation was inflated by $40 million.

He questioned why the company, which was purchased by InBev in 2008, now questions the valuation.

“We have a new company that is coming in and gaming the system,” said Johnson. “This company would be paying less than its fair share, and everyone else will be paying more than their fair share.

“I think that’s a crappy thing for an employer in Larimer County to do.”

Anheuser-Busch opened in Larimer County in 1988 and has since increased production from 6.1 million barrels of beer to 11.2 million in 2007.

The assessed valuation has hovered around $90 million since 2003 without any protest from the company, said Christine Murray, certified general appraiser with the Larimer County Assessor’s Office.

But this year, Anheuser-Busch claimed its value for 2009 is $50 million — much less than the $90 million designated by Murray.

“The number they’re looking at, that $50 million, is random,” said Murray, who stands behind her assessment and says it meshes with those of similar properties. “Nobody seems to know (where it came from.)”

The brewery’s general manager, Kevin Fahren-krog, however, said in a written statement that the figure is from an independent property tax consultant. The consultant, he said, based his figure on similar properties within Larimer County and across the United States.

“We review assessments on our property nationwide on an annual basis and in the current economic climate realize that market values have declined,” according to his statement.

“Anheuser-Busch is a significant tax payer in Larimer County, paying more than $8 million per year in real and personal property taxes.

“We seek to work with the county to pay our share.”

In other football-related property tax news, former NFL lineman Paul Runyan has made the papers recently for grazing donkeys to get a property tax break under New Jersey law. Here’s a tip for Decatur residents—grazing donkeys won’t get you a tax break here, and they’ll just eat your flowers anyway.

Property tax impact on the elderly

A study published last month by the University of Wisconsin examines whether high property taxes force senior citizens out of their homes. Their basic conclusion is that total household expenses, of which taxes one factor, are the more statistically significant indicator. The full article is a little dry, but here’s an excerpt from UW’s news release about the findings:

When pushing for limits on property tax increases, politicians and policymakers often use anecdotal evidence to argue that high or rising property taxes force homeowners, especially the elderly, to sell their homes, according to a study by economist Andrew Reschovsky, a professor in UW-Madison's La Follette School of Public Affairs, and state Department of Revenue economists Rebecca Boldt and Bradley Caruth.

But while property taxes can mean economic hardship for some elderly homeowners who want to stay in their homes, taxes aren't driving them out, the research says.

The study found only a small increase in the probability of moving among older elderly homeowners who experienced large increases in property taxes. In younger households, property taxes had even less of an effect on moving.

Across Wisconsin, only 389 homeowners moved in 2005 because their property taxes grew faster than the median change in property taxes during the previous two years, the study found. Of those 389 homeowners who moved, 85 were older than 79.

"Some homeowners in Wisconsin do face high property taxes relative to their incomes," Reschovsky says. "But most taxpayers who are struggling, even among the elderly, are not picking up and moving because of property taxes. Property taxes are only one part of the cost of living."

However, older elderly homeowners can be more sensitive to large increases in property taxes than younger households, the study shows.

Of all homeowners, one in 1,600 chose to move in 2005 because of an above-average increase in property taxes. But one in 300 older elderly households moved because of larger than average property tax increases.

A final note: the researchers say they used a “rich data set” based on Wisconsin tax records. If you look at the full article, they sure do have a lot of figures and graphs to back up their conclusions, although I wonder if the results would be the same for other states.

The exemptions you deserve

Now is the time to make sure you receive all the homestead exemptions that you’re eligible for for 2010. If you know you already receive your homestead exemption, great—even though it’s Groundhog’s Day tomorrow, you don’t have to apply for the homestead exemption over and over and over again. Just applying once after you moved into your house will do.

If you’re not sure whether you have a homestead exemption, check this spot of your last tax bill. You will see the $20,000 figure listed for the Capital, General, and DDA lines.

If you don’t have your last bill, you can call us at 404-370-4100 or email us to double-check.

If you don’t have the homestead exemption but you’re eligible for it, now is a great time to file your application. All you need to do is fill out this easy online form.

Remember that you have to apply for your homestead exemption for the City of Decatur and DeKalb County separately. Applying for one does not transfer over to the other.

If you’ve become eligible for an additional exemption based on age or income, this is the perfect time of year to get your paperwork in order. If you’re applying for an exemption based on age or income, we will need your: