Gwinnett County, Just Do the Math
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On Tuesday, Gwinnett County Commission Chairman Charles Bannister asked a Superior Court judge to set the millage rate for him, adding a semicolon to the story of county leadership that failed to meet the challenge of a slowing economy. Even worse, it is a challenge that was a surprise to no one.
It’s a semicolon because this story isn’t over. My hope is that, after the threat of a double-digit tax increase and the reality of deep cuts to public services including police and fire, Judge Timothy Hamil will require the Commission to simply “do the math.”
Gwinnett’s cities, the school system and county government itself are all facing financial distress, in large part, due to the Commission’s failure to adopt a county millage rate on time.
Bannister claims that the delay has resulted from the ongoing disagreement between the county and municipalities over which government entities deliver services within the cities and who pays for those services. Also in dispute, that the cities receive certain revenue (primarily insurance premium taxes) to which the county argues they are not entitled.
It is a complex problem and, to date, the disagreement remains. According to Bannister, the county was prepared to adopt a (unknown to me) millage rate on time, but the cities had reportedly threatened to go to court to block it. The cities not only want to keep the insurance premium tax revenue, but they want the county to adopt a separate, lower property tax rate for their residents.
The cities aren’t blameless. Their claim to the insurance premium tax revenue is questionable and their demand for lower tax rates, in my opinion, unjustified. Even worse, they are currently playing a dangerous game of “chicken” with their financial health by reportedly refusing to let the county proceed with tax collection.
“Two Birds…”
In Tuesday’s hearing, the county asked the court not only to order the collection of property taxes but also to essentially resolve the service delivery dispute in the county’s favor. The judge didn’t fall for it.
County attorneys asked the judge to impose property tax rates of 10.94 mills on county residents and an even 12 mills on city residents (one mill is equal to one dollar of tax on every thousand dollars of taxable value). This would be the first year that incorporated and unincorporated property owners paid differing rates.
With those rates, the county would essentially take from city property owners the value of the insurance premium tax that the county claims is owed it by the cities. From a recent county press release:
The 2009 temporary millage rate proposed in the TCO is 10.94 for taxpayers in unincorporated Gwinnett County and 12.00 for taxpayers in incorporated Gwinnett. By comparison, the 2008 adopted county rate was 10.97. In accordance with state law, the unincorporated taxpayers are due a rollback for insurance premium taxes, which equates to 1.06 mills.
In other words, the county calculated that the value of the lost insurance premium tax revenue is equal to 1.06 mills on the value of all taxable property within Gwinnett’s cities. County leaders apparently reasoned that it would be okay to “overtax” city property owners by that amount; after all, their city governments use the tax revenue to subsidize a lower municipal millage rate.
Judge Hamil rejected the county’s dual rate proposal early in the proceedings, as he should have. This forced county attorneys to offer a counter-proposal—a single 2009 tax rate of 11.19 mills, an increase of almost a quarter-mill over last year for all property owners.
Just Do the Math
Judge Hamil’s decision will not resolve any of the issues that brought out county to this point, but it will get tax dollars flowing into local governments’ bank accounts. The judge could help preserve the only shred of dignity left us by Bannister’s failures by requiring the county to adopt a mathematically-correct tax rate… a millage that takes no more and no less from county taxpayers than required to fund the budget. You (and the judge, hopefully) will find the correct way to calculate the millage rate described here.
Tax Increase Coming
A tax increase appears certain, despite citizen outrage at a proposed 3-mill hike; despite deep cuts to services including police and fire; and despite Bannister’s promise to not raise the tax rate this year.
The sad reality is that Gwinnett taxpayers probably would have accepted the quarter-mill hike—without the court’s intervention—had Bannister conducted himself professionally and with honor throughout the budget process. Bannister gave his constituents plenty of reasons to question his competence.
[...] Yesterday, a hearing was held before Judge Tim Hamil on the county’s request for an order to adopt a millage rate for the collection of 2009 property taxes. The county sought a tax rate slightly lower than last year’s 10.97 for county property owners, but a much higher rate of 12.00 for city residents. I provided some detail on the hearing in yesterday’s article. [...]