Traditionally, the term “tax season” refers to the time each spring when our income taxes must be paid. But, in many respects, now is tax season in Newton County. The current year property tax evaluations were recently mailed to property owners and many were shocked at the increases. That means higher tax bills this fall.
Also, it is tax season here because both the Board of Commissioners (BOC) and the Board of Education (BOE) have just approved or are poised to approve their Fiscal Year (FY) 2022 budgets. After budget approval, they will set the property tax millage rates necessary to fund both county government and county schools.
The BOC postponed approval of the county’s $78.1 million FY 2022 budget until August in order to decide on employee salary increases. Hopefully, that will also provide time for the BOC to find ways to lower our property taxes.
There are several reasons property owners should expect a lower rate from the BOC than the current 12.196 mils. First, the county is in great financial condition as it closes out the current fiscal year on June 30. At the end of May 2021, the county had already received $6.4 million more in revenue than anticipated for the whole fiscal year. In total, the county was $20.1 million ahead in revenue versus spending as of May. County government should end FY 2021 with millions in the bank that could be used to reduce the tax revenue needed to finance the FY 2022 budget.
Second, the county’s other funding sources are in excellent condition. In addition to property taxes and service charges, the county also collects SPLOST sales taxes and development impact fees. Those accounts are flush with money. The 2011 SPLOST account has $1.1 million left, and the 2017 SPLOST sales tax account is already $13 million over the amount anticipated. The impact fee fund has $3.3 million available. Those accounts have restrictions but effort should be made to utilize those funds instead of property taxes for eligible items in the FY 2022 budget.
Next, any covid-19 relief funds received in FY 2021 or anticipated in FY 2022 should be used in ways that reduce the tax revenue needed to fund the FY 2022 budget. The county may receive as much as $20 million from the last covid relief bill.
What about the Board of Education? Their tentative FY 2022 budget of $233.8 million dwarfs that of county government. The cost of educating our children is huge and your tax bill reflects that. The school system’s millage rate is 19.788 mils compared to 12.916 mils for the county. The BOE spent $10,561 per student in FY 2020, and $3,240 of that came from local property taxes.
The tremendous cost of our school system is one reason senior citizens in Newton County still have to pay school taxes. Some nearby counties provide reductions for seniors and Newton County needs to work toward that too.
Both the BOC and BOE need to also look at cutting expenses as a way to reduce our taxes. The county tax digest increased from $2 billion in 2015 to $3.0 billion in 2020, a 50 % increase. That growth should have easily financed county and school system operations without a millage increase. And, school tax rates have declined slightly from 20.450 in FY 2015 to 19.791 mils in FY 2021, possibly because of static enrollment and state and federal money available to the school system.
However, county tax rates have risen from 11.225 mils in 2015 to 12.916 mils in FY 2021. That means our county budget has increased faster than our tax digest, and faster than our population growth. That is something the BOC must bring under control.
Part of the problem is that growth of our tax digest has been mostly residential properties which often do not produce enough taxes to support schools and local government operations. The trend here toward more multi-family housing and condominiums may exacerbate our tax problems.
In summary, Newton County is in great financial condition as FY 2021 ends, and that is good news. But, if citizens are to realize lower tax rates, they must make their voices heard by the BOC and BOE members who will soon establish those rates. Griping to your neighbor about taxes will accomplish nothing.