Georgia legislators fight over local taxes

A fight over local taxes pitting Republicans against Democrats in the Georgia legislature continued this weekend, with Democrats emerging victorious at least for the time being.

The Democrats prevented local government referendums on one-cent sales tax increases to offset potential local property tax cuts.

The Democrats are in the minority in both the state House of Representatives and the Senate but have enough votes to block ballot measures.

Tax measures must be brought to public referendum and to do so need two-thirds approval in the two legislative bodies.

A motion to approve 66 bills failed to get the necessary super majority in the House, with 59% of the vote. A vote on three other bills in the Senate tallied 65% of the votes.

"We think these are local decisions and each local community should have the opportunity to decide how they pay for local services and how to allocate the tax burden," said Clint Mueller, deputy director of the Association of County Commissioners of Georgia. When asked whether the organization supported the referendums or opposed them, he said the association did not back either side.

The Georgia Municipal Association said it "supports providing local communities with the flexibility to address their unique financial needs." Since cities have differences, it said, "local leaders are often in the best position to determine the appropriate mix of revenue sources needed to fund essential services."

In the spring, Georgia approved a proposal to allow voters to lower property taxes and increase sales taxes. While this proposal will allow referendums on the topic next year, the measures that failed this weekend would have put referendums on the November ballot.

Democrats have said exchanging property taxes for sales taxes would place more tax burden on lower income and lower wealth members of the community.

Georgia property values have grown faster than the rate of inflation in recent years, driving political interest in curbing property taxes.

Many Georgia local bonds are backed by special purpose local option sales taxes, but localities and school districts generally back up the sales tax promise with a general obligation pledge, so property tax revenues affect the bonds.

This fall Florida voters will have the option to approve cuts to local property taxes.