Friday, July 22, 2022

Hearings Set On 9.8 Percent Increase In Property Taxes For Oconee County Schools

***Millage Rate Drop Does Not Offset Assessment Inflation***

The Oconee County Board of Education will hold the first two of three public hearings on Monday on what amounts to a 9.8 percent increase in property taxes for operation of Oconee County Schools in the coming year.

The Board in June adopted a budget for the Fiscal Year that began on July 1 based on lowering the millage rate for schools from 16.5 to 16.25.

Because of the inflationary growth in the assessment of property in the county, however, the Board would have had to have dropped the rate to 14.8 to have avoided a real increase in property taxes for county residents.

The increase in the millage rate of 1.45 follows an increase of 0.882 last year and 0.730 in 2020.

The Oconee County Board of Commissioners has announced it will reduce the millage rate in August for county services by .696 in the unincorporated parts of the county and by .786 in the county’s four cities.

That rate means there will be no property tax increase to cover non-school county operations.

More than 70 percent of the property taxes for county and school operations goes to finance the schools, however, and Oconee County Schools has estimated that the tax increase will be $258 this year for the owner of a home assessed at $450,000.

The hearings on Monday will be at 9 a.m. and at 6 p.m. at the Board Meeting Room in the Superintendent’s Office, 34 School Street, in Watkinsville. The final hearing will be at 5:30 p.m. at that same location on Aug. 1.

Monday Meeting

Oconee County Schools Chief Financial Officer Liz Harlow gave the Board the schedule for the three legally required public hearings at a meeting it held on Monday.

From Bottom Of Page B3
July 14, 2022, Edition of The Oconee Enterprise

A required advertisement announcing the tax increase appeared at the bottom, right-hand section of page B3 of the July 14 edition of The Oconee Enterprise.

Oconee County Schools also sent out a news release about the tax increase and the hearings on July 13 to its list of media outlets and posted that announcement on the school system home page.

(I have asked to receive news releases, but Oconee County Schools has refused to send them to me. I, of course, am not a media organization.)

The Board will be required to run another advertisement before the Aug. 1 hearing.

The Board is schedule to adopt the new millage rate at its work session following that hearing on Aug. 1.

The Board must submit its adopted budget with the 16.25 millage rate by Sept. 30 to the Georgia Department of Education.

Promoting Millage Rate Increase

When the Board adopted its new budget in June, predicated on the 0.25 point drop in the millage rate, it made much of the finding by Harlow that it was the lowest rate going back at least to 1999.

The subhead on the tease to the story under District News on the Oconee County Schools web homepage about the budget says: “Lowest millage rate this century.”

The Georgia Department of Revenue, under “Prevention of Indirect Tax Increases,” explains that there are two ways in which a county tax digest, or the complete listing of value of property in the county, can increase.

The first is due to inflation.

The second is due to the addition of new or improved properties.

“There are no additional requirements if the levying authority rolls back the millage rate each year to offset any inflationary increases in the digest,” the Department of Revenue states. “If it does not, a local levying authority must notify the public that taxes are being increased.”

In short, the School Board could have increased its tax revenue based only on real growth, that is, new or improved properties, without creating what the state calls a tax increase.

That is what the Board of Commissioners did this year.

Hearing Requirements

Georgia Law requires that a rollback millage rate must be computed and communicated to the public that will produce the same total revenue on the current year's new digest that last year's millage rate would have produced had no reassessments for unchanged properties occurred.

Home Page Oconee County Schools 7/22/2022
(Click To Enlarge)

This year, the Board of Education would have had to have reduced the rate from 16.5 to 14.8 mills, rather than to 16.25, to have avoided a tax increase.

Last year, the required rate would have been 15.618 rather than 16.5.

And in 2020, it would have been 15.77 rather than 16.5.

If the Board of Education elects to set its millage rate higher than the rollback rate, it must hold three hearings allowing the public input into the proposed increase in taxes, according to Georgia law.

In 2020, the advertisement about the tax increase used a home value of $350,000 to estimate the tax increase as $100.

In 2021, it used a home assessed at $375,000 and estimated the tax increase as $130.

This year, it used $450,000 to estimate the tax increase of $258.

Estimates of median values of homes on the web vary, but Rocket Homes lists a median of $439,216 in the last 12 months for Oconee County, an increase of $70,941 (or 19.3 percent) from June of 2021.

Budget Details

Oconee County Schools has released to the public only a budget summary for Fiscal Year 2023, which began on July 1.

The budget summary shows an estimated Fund Balance (or nonbudgeted funds) in June 30, 2023, of $32.5 million.

That is a growth of $1.7 million from the $30.7 million Fund Balance at the end of the last Fiscal Year, June 30 of 2022.

The Budget Summary for the last Fiscal Year had projected a fund balance for June 30, 2022, of $28.3.

In other words, the Fund Balance from last year was $2.5 million higher than budgeted a year ago.

Oconee County Schools has received COVID relief funds in recent years, and last year spent $986,635 for Technology, $393,818 for School Buses, Harlow told the Board at its retreat in January.

The purchased items had been budgeted to be paid for by local monies.

I have filed repeated open records requests to get detailed budgets for Fiscal Year 2022 and Fiscal Year 2023, but so far I have received only budget summaries, which are available on the web.

Sales Tax Reports

At the meeting on Monday, Harlow told the Board that collections from the county’s 1 percent Education Local Option Sales Tax (ELOST) for May were up 38.9 percent from the same month a year ago, and collections for April were up 60.8 percent.

Collections are running, on average, 16.1 percent higher per month than they were for the same month a year ago, she said.

Total collections for the current ELOST V as of June 30, 2022, was $37.4 million, she reported.

The projected revenue from the tax, which runs through the end of the year, is $39.9 million, meaning revenue is likely to exceed the amount budgeted for the tax by several million dollars.

Collections are running about $0.8 million per month, with seven months of collection remaining.

Harlow reported that Oconee County Schools has a surplus of $3.1 million from ELOST VI that is now included in the ELOST V account.

The result is that the total amount of ELOST V funds available are $11.3 million as of June 30, with $6.2 million still to be paid against total bond payment obligations of $25.9 million and with seven months of taxes still to be collected.


Lionheart said...

With the huge splost revenues and surpluses and the big increases in revenues from inflationary home values...I find it incredibly offensive for the county school board to refuse to rollback the mileage rate and avoid increasing citizens tax burden in these difficult financial times!!
Roll back the millage rates!!

Lionheart said...

Highway robbery.
Edwin Snell

Johnny Prescott said...

This BOE is off the rails with calls for a near 10% tax increase fresh off two years of COVID and historic inflation. Contact them and tell them absolutely not. Any BOE member who votes for this needs to be primaried and gone.