FULTON COUNTY 2018 PROPERTY TAX ASSESSMENTS
Over the past few weeks, I have held three town hall meetings at which I provided residents an update on three key topics: property taxes, transit and the opioid epidemic. For those of you who were not able to attend, I want to provide you an update with a specific focus on property taxes. It is a bit lengthy, but I wanted to share the key details with you, because I know your money is important and you want and need to be informed.
2017 RECAP – A TUMULTUOUS PROPERTY TAX CYCLE
Initial notices of property assessments found many of you seeing steep increases in assessed values. Many of the increases may have been an accurate assessment of individual home values reflected by two factors:
However, a large number of you saw huge increases that seemed to bear no relationship to the value of your home. Additionally, people owning properties that were supposed to have frozen values due to appeal settlements were improperly unfrozen. People were legitimately caught off guard and were frustrated.
- A rising real estate market;
- A slow moving Fulton County Tax Assessor’s Office playing catch up after not meaningfully updating property assessments for a number of years prior to 2017.
After much citizen input from around the county, the Board of Commissioners (BOC) chose to revoke the original 2017 assessments primarily due to the large number of errors that were presented by citizens. Our decision was reinforced by the fact that the BOC had already asked the State of Georgia to step in and audit the Fulton Tax Assessors Office. This action was taken because an initial audit by Fulton County’s own internal auditor revealed a host of troubling issues in the department. In short, there was little reason for anyone to have confidence in the process. Accordingly, the BOC asked the Assessor’s Office to provide revised notices for residential properties largely based on 2016 values. The BOC relied on powers vested to it in its charter to take this rare action.
Fulton County advised and briefed the Georgia Department of Revenue (DOR) of its actions throughout the process and received no indications of current or potential problems. However, roughly two weeks after the tax digest was submitted to the DOR for approval, it was rejected. This led the County to seek a Collection Order so that tax bills could be sent and tax revenues collected. The Order was granted, the tax bills were mailed, and despite some unnecessary histrionics from the superintendents representing Atlanta Public Schools and Fulton County Schools, citizens responded and paid their bills. All local governments, including schools, cities and the County continued with services and operations without interruption.
KEY ISSUES IDENTIFIED AND HOW THEY HAVE BEEN ADDRESSED
Through a host of town hall meetings and other means of communications and feedback, several key issues emerged:
FLOATING HOMESTEAD EXEMPTION (CAPS) LEGISLATION
- The desire for property tax caps to protect homeowners from a sharp increase in property taxes solely as a result of a steep increase in assessed value.
- Seniors voiced frustration with the complexity and confusing nature of the myriad of senior exemptions. Many questioned the various exemptions’ parameters, and remain concerned that there are not school tax exemptions for seniors in Fulton as there are in neighboring counties like Cobb.
- Citizens expressed frustration with service and response issues from the Tax Assessor’s Office, specifically mentioning inadequate information on the website, difficulty getting information corrected on their properties, having to file open records requests to get property information, lack of transparency on how their property was assessed and difficulties with appeals.
- Valuations were questioned in certain areas, particularly non-neighborhoods, transitional neighborhoods and those near new developments.
- Frustration was expressed about lack of transparency and understanding of the Notice of Assessment and how it would impact your tax bill and the setting of millage rates.
I have long been a proponent of some form of property tax caps on residential property, as they already exist in multiple states and in many counties in Georgia. For several years, a cap-like mechanism or floating homestead exemption has been in place for two taxing jurisdictions in Fulton County – Fulton County government and Sandy Springs city government. However, if you live in a homesteaded property, this leaves a large portion of your tax bill uncapped and subject to significant increases in both the school portion and the city portion (except in Sandy Springs) of your property tax.
For a cap to go into effect in the state of Georgia, the state legislature must pass local legislation calling for a referendum to allow citizens to vote for such a change.
Since June of last year, I’ve been speaking with state legislators about getting the appropriate legislation introduced and approved. The Board of Commissioners made a specific request for state legislators to introduce local legislation enacting floating homestead exemptions in all taxing jurisdictions in Fulton County. This would ensure taxpayers have the certainty of a cap on their entire taxable assessed value.
During the 2018 legislative session, Floating Homestead legislation was passed for Fulton County Schools (not Atlanta Public Schools), the City of Milton, Roswell, Johns Creek, Alpharetta, Mountain Park and the City of Atlanta. It is unfortunate that they did not pass legislation for all jurisdictions, but I am pleased that the citizens of my District will have the opportunity to vote to enact these Floating Homestead Exemptions. These referendums will be held in November in conjunction with the general elections.
While a great win for homeowners, it is critical to understand that this will have NO impact on your 2018 tax bill, as it would not go into effect until 2019. Additionally, these will only impact homesteaded property. They will not apply to commercial or rental property.
If the referendums are approved this November, you will likely see a favorable large jump in your homestead exemption in 2019 which will lower your taxable assessed value. Another beneficial impact of the referendums passage would be that the base year for your established value for the homesteads in 2019 will be the LOWEST of your 2016, 2017 or 2018 assessed value -- PLUS the amount allowed for in the cap (the lower of 3 percent or CPI).
The upshot: Get out and vote in November to support these homeowner protections.
The existing exemptions available to seniors have different age tests and income tests. It is often confusing to understand what exemptions are available, whether you qualify for them and how to qualify. We presented the maze of exemptions to state legislators to drive home the fact that they need to be simplified.
We placed a heavy emphasis on education in this area, as well as on general homestead exemptions for all homeowners. We produced videos, conducted meetings at targeted senior locations, shared information thru social media and printed materials with more clear and concise information. We encouraged seniors to take advantage of the exemptions available to them and we have been pleased that many seniors and non-seniors did seize the opportunity.
I’ve received a plethora of feedback from multiple seniors desiring property tax relief on their school taxes, similar to that offered in some neighboring counties. I want to stress that the ultimate decision on that rests with the Fulton County Board of Education/Atlanta Board of Education and the State legislature, not the Fulton County Board of Commissioners. However, the level of feedback has been so substantive that I have sought to clearly express the forcefulness of your opinions to school board members and state legislators. Though discussions took place, no legislation was offered in this area in 2018. One key area of resistance from the school systems was the claim that they did not have sufficient data to determine the financial impact of such an exemption and could not properly plan for the future.
One exemption that did pass this session may well provide a pathway to a school tax exemption for seniors. We worked with Rep. Chuck Martin of Alpharetta to create an additional $20,000 homestead exemption for citizens age 65 or older for the Fulton County government portion of your taxes with no income-related requirements. Should this referendum pass this November, not only will citizens who fall in that category see the benefit in the 2019 tax year, it will also allow the school systems to have real data that they can then model and make an informed and transparent decision on whether to move forward on some type of senior school tax exemption.
The Fulton County Assessors created a new website with self-service tools that should improve citizens’ experience. The self-service tool, SmartFile, will allow users to securely file forms online and view an up-to-date status of their requests. Currently, you can change the mailing address of your property online and also gather data about your property, such as lot size and square footage. In addition, a new online appeal mechanism has been added and more services will be available in the 3rd and 4th quarters of 2018. In the interim, if you find other discrepancies, please notify the Board of Assessor’s staff.
Another important customer service initiative that has been undertaken was the approval by the BOC for funding for the Board of Assessor’s to hire additional personnel so they can respond to citizens more quickly and efficiently.
MORE CONFIDENCE AND TRUST IN VALUATION
Rising valuations which are solely a function of a rising real estate market are frustrating, but ultimately, they are required in order to be in accordance with state law.
Last year, in my estimation, we had way too many incorrect valuations. Many of you shared your stories and examples with me which I, in turn, shared with our Chief Appraiser. In 2017, I met with him on more than one occasion and pointed out the areas of my district where I had concerns and that I felt needed a deeper analysis. After multiple meetings with the Assessor and his staff, I was assured such a review was being conducted. Still, I have not had good transparency into that analysis and am in the dark as to whether a true and comprehensive review has in fact been completed. I don’t feel I can assure citizens in those areas that their 2018 assessment is a fair and accurate representation of the value of their property. I want you to understand that if you supplied me with specific concerns, I have been actively advocating for you and your neighbors. For you and me, the rubber meets the road on credibility when we receive our assessment notices. I hope that many of the valuation issues raised will be addressed, but we’ll have to wait and see.
Additionally, I have expressed my concern that the Assessor’s Office uses a mass appraisal model of valuing properties that is not as comprehensive as it should be and the result of that model is pockets of properties are valued in way that is not justified. Other counties have utilized what is referred to as a “market model,” which is still a mass appraisal model, but has more meaningful and dynamic inputs. Counties using the market model do not seem to have as many complaints about assessment credibility as that experienced by Fulton County. I have pressed that we adopt such a model and that it go into effect for the 2019 tax year, since I was told it was not feasible to implement for 2018. I reiterated the importance of this to the Board of Assessors again last week.
WHAT WILL YOUR 2018 ASSESSED VALUE BE?
Generally speaking, you should expect your property to be valued at close (90 to 110%) to its fair market value. Generally speaking, much of the county and metro Atlanta is seeing a healthy real estate environment where home prices have been consistently rising. Many have asked me if they should assume the initial May 2017 assessment that they received will be what they see as their 2018 assessment. I’ve told folks that it’s a good idea to at least plan for that as a strong possibility, especially if you think that 2017 assessment was close to fair market value.
I would also encourage everyone to give some careful thought now to what you think your property is worth, and if you disagree with your 2018 assessment, be prepared to appeal.
When it comes to appeals, I heard from many of you about your “not-so-enjoyable” experiences with the Board of Equalization. I have expressed to our Chief Appraiser that there seems to be too many appeals that go to the Board of Equalization that could be addressed at the front-line Assessor level. He has indicated to me that he agrees and will be working with his staff to handle as many appeals as possible, so residents do not have them go thru the Board of Equalization unless clearly warranted.
YOUR ASSESSMENT AND ITS RELATIONSHIP TO YOUR ULTIMATE TAX BILL
As a reminder, your notice of tax assessment is NOT your tax bill. State law requires an estimated tax bill, but it does not fully note exemptions. What is lacking most frequently is the presence of city exemptions. That is due to the fact Fulton County does not handle tax billing for many cities and thus does not have records of the exemptions that apply to individual properties. Also note that the millage rates on your assessment are the PRIOR year millage rates. The current year millage rates are always set AFTER the assessments are released. Generally speaking, if property values go up and a jurisdiction chooses to hold the millage rate the same, they are, according to Georgia state law, levying a tax increase and must advertise it appropriately to allow citizens to understand it and offer comment. If they choose not to capture any revenue from the aggregate growth in reassessments, they must reduce their millage rate to reflect that fact.
It is important to note even if a jurisdiction reduces its millage rate and does not capture any new revenue from reassessments, a property owner could still see a higher tax bill. That is, if your taxable assessed value percentage change is higher than the millage rate rollback percentage, you are on the losing end. You are on the winning end if your taxable assessed value percentage change is lower.
The ultimate millage rate for 2018 for each taxing jurisdiction in Fulton County is yet to be determined. I do want to stress to you that Fulton County government has reduced its millage rates in each of the last three years at a rate that was equal to or greater than the growth in reassessments. It is my hope that we will do so again this year. We adopted our 2018 budget in January, will set our millage rate this summer and collect the money that funds our budget in the latter part of the year. Fulton County’s 2018 budget did not plan on capturing large amounts of revenue from reassessments. Our budget presumed only a 4 percent increase in revenue that I believe will be generated, not from reassessments, but instead from new growth and the addition of new properties.
The Fulton County Assessment function has been a source of concern and frustration for me since I took office in 2015, and I have -- and will -- continue to push for change and improvement. I do feel that much progress has taken place this year, but I am still not fully comfortable with where we are.
Thanks for the opportunity to serve you, and please feel free to reach out to me with any questions.