Property Tax Administration annual report FY 2000

STATE OF GEORGIA
2000 ANNUAL REPORT REGARDING
PROPERTY TAX ADMINISTRATION
GEORGIA DEPARTMENT OF
REVENUE
January 20, 2001
T. Jerry Jackson Commissioner

Commissioner's Report to the General Assembly
Regarding Property Tax Administration Georgia Department of Revenue January 20, 2001

Highlights of Annual Report Reporting Requirements Digest Review Procedures Value and Revenue Public Utilities Preferential Agricultural Assessment Conservation Use Valuation Timber Recommendations

Page 3 Page 5 Page 6 Page 10 Page 15 Page 18 Page 24 Page 29 Page 32

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HIGHLIGHTS OF ANNUAL REPORT

DIGEST REVIEW:

!

The Revenue Commissioner continues to insure uniformity and equalization between and within

counties using the same procedures enacted in 1992, and in the manner prescribed in Article

5A of Chapter 5 of Title 48.

!

Of the 53 counties falling in the 1999 review year, 9 county ad valorem tax digests failed to

meet the state standards for approval, compared to 13 counties in 1998. As a result, $70,745

was initially assessed in penalties and $53,547 in additional state tax. After appeals, the

penalty amount of $70,745 was either withdrawn or will be deferred once a consent order is

signed. The total additional state tax, after appeals, amounted to $38,256.

!

Of the other 106 counties, 12 county ad valorem tax digests failed to have an acceptable overall

average assessment ratio, compared to 22 in 1998. As a result, additional state tax and

interest in the amount of $351,180 was assessed these 12 counties.

!

The average level of assessment, as measured by the Median, has fallen from 38.58% in tax

year 1993 to 37.33% for tax year 1999. Even so, the assessment level remains within the

acceptable standard of 36.00% to 44.00%.

!

The average level of uniformity, as measured by the Coefficient of Dispersion, has decreased

from 15.05% in 1993 to 11.49% for 1999, indicating continued improvement in this statistical

measure.

!

The average level of assessment bias, as measured by the Price Related Differential, has also

shown continued improvement; a measure of 101.06% in 1999, compared to 102.43% in 1993.

!

Assessed values reached a high of 187 billion in 1999 or a 8.8% increase from the values

reported in 1998; while the average millage rate of 24.35 decreased less than 2% from 1998 to

1999.

PUBLIC UTILITIES:

!

The statewide average equalization ratio for public utility property in 2000 was 37.40%

compared to 37.27% in 1999. Though decreasing, we do not expect a continuation, as counties

are performing revaluations that are expected to improve the statewide average in future years.

!

Equalization ratios for 81 of the 159 counties were proposed at a ratio less than 40%.

PREFERENTIAL AGRICULTURAL ASSESSMENT:

!

Since the implementation of Preferential Agricultural Assessment in 1984, the number of parcels

in this program has risen from approximately 10,000 to almost 23,000; the amount of value

eliminated from the digests has increased from 86.9 million to 191.2 million; and the total tax

dollars lost by local government has increased from 1.6 million to 4.7 million.

3

CONSERVATION USE VALUATION:

!

Since the implementation of Conservation Use Valuation in 1992, the number of parcels in this

program has risen from approximately 16,000 to more than 60,000; the amount of value

eliminated from the digests has increased from 395.8 million to approximately 1.9 billion; and

the total tax dollars lost by local government has increased from 8.9 million to approximately

50.1 million.

!

These dramatic increases are expected to continue to grow as property valuations increase.

TIMBER TAXATION:

!

Since 1992, values reported for timber sales and harvests have increased from 493.1 million to

712 million or 44%, while the revenues for the same time period have increased from 11.5

million to 18 million, or approximately 36%.

!

Prior to 1996, each quarter the Department was required to develop a Table of Owner Harvest

Timber Values report used by timber companies and individuals for reporting the value of timber

harvested from their own land. In 1996, the change to O.C.G.A. 48-5-7.5 requiring that this be

done on an annual basis has definitely saved the Department time and personnel costs.

RECOMMENDATIONS:

!

Increase the level of state appraisal expertise provided to the counties from the current 15. See

Page 32 of Report

!

Provide the Department with the necessary funds to conduct research into rapidly evolving

technologies as required by O.C.G.A. Section 48-5-270. See Page 33 of Report

!

Reinstate budget funds for Staff Grants and minimum staff supplements. See Page 33 of Report

4

Reporting Requirements
The Commissioner's responsibility for continuing to provide the General Assembly with the effect of property tax administration and the continued enactment of laws created by legislation and administered by the Department of Revenue, Property Tax Division are as follows:

!

O.C.G.A. Section 48-5-349.5 requires the examination of the digest of each county to ensure that

all property valuations are reasonably uniform and equalized among the counties and within the

counties. This code section provides for a status report on this review process along with the

Commissioner's observations regarding the progress of the counties in ad valorem tax

administration.

!

O.C.G.A. Section 48-5-7.1 requires the submission of a report showing the fiscal impact of the law

providing for the preferential assessment of tangible real property devoted to agricultural use.

Qualified farm property is assessed at 75% of the value under this program and this report analyzes

the effect of this program on taxpayers and levying authorities.

!

O.C.G.A. Section 48-5-7.4 requires a report showing the fiscal impact of the law providing

for conservation use assessment of certain agricultural properties attendant with this code

section. Qualified farm property is assessed at its current use value using a table of values

established by the Commissioner following specific legal procedures. This report analyzes the

adverse fiscal impact, if any, on other taxpayers and levying authorities.

The Commissioner believes these separate reporting requirements are important in maintaining the awareness of the impact of these enactments.

5

Digest Review Procedures
The Commissioner, through the Property Tax Division, has been given the statutory duty of reviewing county tax digests to determine if the digests meet the criteria mandated in statute case laws and regulation for level of assessment1, uniformity2, and equalization3.
Article 5A of Chapter 5 of Title 48 establishes the procedure for the Commissioner to equalize county property tax digests between and within counties and compel county boards of tax assessors to make adjustments in property valuations so as to insure uniformity and equity.
As directed by the legislature, the Commissioner has adopted a three-year digest review cycle in which each county's tax digest is reviewed extensively to determine the level of assessment, uniformity and equalization in each property class. In any given year, one third of the county tax digests are subject to extensive statistical testing. Counties, which do not meet the criteria, set forth in the stature and regulations are allowed an opportunity during the three year cycle to correct any deficiencies by the next review year. The other counties that are not being extensively reviewed are examined for level of assessment to equalize the state levy and public utility assessments. The Commissioner approves any county's digest as being reasonably uniform and equalized if the digest meets certain standards:
For those digests submitted by counties in their digest review year, the Commissioner completes his review on or before August 1 of the following tax year. Based upon this review, the Commissioner will approve any digest when it is found to be reasonably uniform and equalized by having met the following state established standards:
the average level of assessment for each class of property meets the state standards of 36% to 44%;
the average measure of overall equalization, the coefficient of dispersion4, meets the state standard
of 15% or less for residential properties and 20% or less for all other property classes; and
the bias ratio, or statistical measure of price related differentiall5, meets the state standard of 95% to 110%.
The Commissioner conditionally approves the digest and assesses a penalty of $5.00 per taxable parcel of real property if a county's review year digest contains the same or similar deficiencies as the previous review year digest. If the overall average assessment level does not meet state standards, the county is assessed additional state tax in the amount equal to the difference between the state's one-quarter of a mill that would have been produced if the digest had been at the proper assessment level and the amount the digest actually produces for collection purposes.
For those counties submitting their digest during a non-review year, digests are evaluated by the
1 The comparison of an individual property's actual sales price versus its assessed value is a measure of the level of assessment. The ratio required by state statute is 40%.
2 The measurement of quality of the results produced by a county's valuation program will determine if properties are valued in a uniform manner.
3 Equalization is the measure of equality of assessment. In order to possess good equalization, a county tax digest should value all properties at about the same level of assessment.
4 The coefficient of dispersion is the statistical representation of equalization.
5 The price-related differential is the statistical measure of assessment bias. This demonstrates whether lower or higher priced properties are more accurately assessed.
6

Commissioner based on the overall average assessment ratio deviation from the proper assessment ratio of 36% to 44%.
If the Commissioner determines that a county's digest does not meet the acceptable ratio of 36% to 44%, the county is assessed additional state tax in the amount equal to the difference between the state's one-quarter of a mill that would have been produced if the digest had been at the proper assessment rate and the amount the digest actually produces for collection purposes.
To measure the compliance of each county in meeting state standards for digest approval, the Commissioner performs a sales ratio study for each county using actual sales compared to the assessed values established for ad valorem tax purposes. In some instances appraisals performed by the State Audit Department are included to supplement the study. Each county's ratio study measures the statistical standards of level of assessment, uniformity and equalization.

Results of the 1999 digest reviews for counties falling in the 1999 Review Year and the current status of each:
The review of the 53 counties falling within the 1999 review year resulted in only 9 counties being subject to the $5.00 per taxable parcel penalty, additional state tax, or both.

COUNTY
CRAWFORD JONES LAMAR LINCOLN MACON TERRELL TREUTLEN UPSON WILKES
TOTAL

$5/PARCEL PENALTY
36,345
34,400

ADDITIONAL STATE TAX ASSESSED
4,612 9,994 9,640 5,599
4,054 1,828 11,290 6,530

INTEREST PAID
53

CURRENT DISPOSITION
ADDITIONAL STATE TAX PAID ADDITIONAL STATE TAX PAID ADDITIONAL STATE TAX PAID ADDITIONAL STATE TAX PLUS INTEREST PAID PENALTY WITHDRAWN UPON APPEAL-DIGEST APPROVED ADDITIONAL STATE TAX WITHDRAWN UPON APPEAL ADDITIONAL STATE TAX PAID ADDITIONAL STATE TAX WITHDRAWN UPON APPEAL APPEAL PENDING

70,745

53,547

53

The review of the other 106 counties resulted in 24 counties being assessed additional state tax:

COUNTY
BACON BALDWIN BERRIEN BIBB DODGE ELBERT EMANUEL FRANKLIN GILMER JACKSON JENKINS JOHNSON

ADDITIONAL STATE TAX 4,595 14,117 13,924 99,662 9,109 9,884 6,847 19,794 48,028 30,014 3,397 4,037

INTEREST PAID 92 282
2,990 182 395 137
961
68

COUNTY
LUMPKIN MCINTOSH MILLER PEACH PIKE PULASKI RANDOLPH SCHLEY SCREVEN SEMINOLE TALBOT TWIGGS TOTAL

ADDITIONAL STATE TAX 13,142 7,143 4,450 8,737 8,572 5,298 4,795 2,010 8,724 5,921 2,673 9,860 345,333

INTEREST PAID
286
86
40 118 112
99 5,847

Several graphs are being included on the following pages to provide a visual indication of the various measurable statistical standards since 1993:
7

Figure 1 - This graph indicates that, even though the Median Ratio has fallen from 38.58% in 1993 to 37.33% in 1999, the assessment level remains within the acceptable standard of 36% to 44%. In general, Georgia law requires taxes to be assessed at 40% of the fair market value of the property. So the overall level of assessment is a measure of the effectiveness of the county's valuation program.

Figure 1 - Average Level of Assessment

39.00%
38.58%
38.50%

38.00%

37.50%

37.00%

36.50%

36.00%

1993

37.88% 37.90%

37.65% 37.39%

36.95%

1994

1995

1996 Tax Year

1997

1998

37.33%
1999

Figure 2 This graph shows the average level of uniformity, as measured by the Coefficient of Dispersion, and indicates the equality of assessments between individual properties. Case law indicates that this is the most important measure of fairness within a taxing jurisdiction. Beginning with the 1995 tax year, the Commissioner, through regulation, tightened the acceptable standard of equalization and uniformity from 20% or less to 15% or less for residential properties, and from 25% or less to 20% or less for non-residential properties. Since 1993, this statistical average has decreased from 15.05% to 11.49% for 1999, demonstrating continued improvement.

Figure 2 - Average Level of Uniformity

20.00% 15.00% 10.00%
5.00% 0.00%

15.05%
1993

14.74% 15.38%

14.18%

11.82%

12.12% 11.49%

1994

1995

1996 Tax Year

1997

1998

1999

8

Figure 3 - This chart shows the past seven years average assessment bias, as measured by the Price Related Differential. This standard has also shown continued improvement from 1993 when the average was 102.43% to the 1999 average of 101.06%.

Figure 3 - Average Level of Assessment Bias

103.50% 103.00% 102.50% 102.00% 101.50% 101.00% 100.50% 100.00%
99.50%

102.43%
1993

102.76%
1994

103.27% 102.96% 101.98% 100.84%

1995

1996 Tax Year

1997

1998

101.06%
1999

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Value and Revenue
Since the implementation of the new digest review procedures, counties have been constantly performing either total or partial revaluations and updates to properties in order to conform to the state standards for acceptable digests. In doing these revaluations and updates, property values have increased significantly since 1993. Figures 4 and 5 show the changes in the total values and the average millage during the last several years, while Figure 6 shows the breakdown by property class of the values reported on the 1999 tax digests.

200

180

160

140

120

100

131.7

80

60

40

20

0

1993

Figure 4 - Total Assessed Value

137.0

136.1

147.3

157.2

171.8

1994

1995

1996 Tax Year

1997

1998

187.0 1999

26 25.5
25 24.5
24 23.5

24.23 1993

Figure 5 - Average Millage Rate

25.17

25.44

25.28

25.16

24.76

1994

1995

1996 Tax Year

1997

1998

24.35 1999

10

Figure 6 - Percentage of 1999 Values by Property Class

Timber Utility 0.4% 5.3%

MV 9.3%

MH 0.6%

Ind 6.3%

Res 45.6%

Comm 27.2%
Agr 5.3%
Res Agr Comm Ind Utility Timber MV MH

Property tax continues to be the primary revenue source for local governments. Currently, approximately 5.2 billion in revenue is collected from property taxes in Georgia. Because there is limited Department involvement in the collection of city taxes, this report does not focus on this tax type. Figures 7 and 8 show the total revenues and the revenue breakdown by tax type generated from the 1999 tax digests. Figures 9, 10 and 11 show the breakdown of the tax burden between the different classes of property for County, School, and State tax purposes. It is evident from these figures that residential property owners continue to bear the largest share of the tax burden, with commercial property owners following next.

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Figure 7 - Comparison of Total Revenue

7

6

5

4

3

2

3.1

1

0

1993

3.3 1994

4.2 4.1

5.2 5.0

1995

1996 Tax Year

1997

1998

6.0 1999

Figure 8 - 1999 Total Revenue By Tax Type - In Billions

Cities - 7.9%

State - .8% County 34.0%

State - .8% County - 34.0% School - 57.3% Cities - 7.9%

School - 57.3%

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Figure 9 - 1999 County Tax Revenue - In Millions

Motor Vehicles 185.8
Timber - 8.1

Mobile Homes - 10.8 Residential - 880.0

Public Utility - 100.6

Industrial - 187.0

Residential - 880.0 Agricultural - 73.3 Commercial 605.8 Industrial - 187.0 Public Utility - 100.6 Timber - 8.1 Motor Vehicles - 185.8 Mobile Homes - 10.8

Commercial 605.8

Agricultural - 73.3

Figure 10 - 1999 School Tax Revenue - In Billions

0.010 0.316 0.168

0.017

1.484

Residential - 1.484 Agricultural - 0.111 Commercial - 1.023

0.307

Industrial - 0.329 Public Utility - 0.168

Timber - 0.010

Motor Vehicles - 0.316

1.023

0.111

obile Homes - 0.017

13

Figure 11 - 1999 State Tax Revenue - In Millions

0.178 2.477

4.260

0.200

21.976

4.419

12.736

1.851

Residential - 21.976 Agricultural - 1.851 Commercial - 12.736 Industrial - 4.419 Public Utility - 2.477 Timber - 0.178 Motor Vehicles - 4.307 Mobile Homes - 0.277

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Public Utilities
O.C.G.A. Section 48-2-18 requires the Commissioner to annually propose assessments for public utility property and to insure that these properties are assessed at the same overall average assessment level as other property in the county. Each utility company is required to annually return their properties indicating location, description, type of property and valuation. The Commissioner's staff inspects these returns to insure the accuracy of each utility company's declarations. The location of the property must include the county within which it is located, the tax district within that county, (i.e. County, City, etc) and a physical address such as a street name. These property returns also include a physical description of the property. The utility company is required to identify the property's designated type, operating or non-operating. Operating property is defined as any property required, directly or indirectly, for the operation of the utility. Non-operating property would then be any property not required for the operation of the utility. In determining each county's proposed assessments for 2000 public utilities and airlines, the Commissioner calculated the equalization ratios using 1999 digest totals and ratio statistics. This method insured that proposed public utility values were set at the same overall average assessment level as other properties. Once the State Board of Equalization approved these values and equalization ratios and assessments were issued to the counties and utility companies. Each county board of tax assessors then determined the final assessment of utility properties by either accepting the State's proposed values or substituting their own in issuing assessment notices to the utility companies. Table 1 on the following page shows each county's 1999 equalization ratio as proposed by the state and the ratio finally determined by the county board of tax assessors. In most instances where the ratio used by the county exceeds the state proposal, it is due to the county's having preformed an update or revaluation.
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Table 1 2000 Public Utility Equalization Ratios Using 1999 Digest Ratios

County Appling

Proposed Ratio 40.00

Final Ratio
40.00

Atkinson

40.00

40.00

Bacon

34.29

34.29

Baker

40.00

40.00

Baldwin

35.26

40.00

Banks

40.00

40.00

Barrow

40.00

40.00

Bartow

40.00

40.00

Ben Hill

40.00

40.00

Berrien

34.24

34.24

Bibb

34.98

34.98

Bleckley

40.00

40.00

Brantley

37.08

40.00

Brooks

36.96

36.96

Bryan

40.00

40.00

Bulloch

40.00

40.00

Burke

40.00

40.00

Butts

40.00

40.00

Calhoun

40.00

39.10

Camden

40.00

40.00

Candler

40.00

40.00

Carroll

40.00

40.00

Catoosa

40.00

40.00

Charlton

36.60

36.60

Chatham

40.00

40.00

Chattahoochee

36.93

36.93

Chattooga

40.00

40.00

Cherokee

37.42

37.42

Clarke

40.00

40.00

Clay

40.00

40.00

Clayton

37.40

37.40

Clinch

36.77

36.77

Cobb

37.66

40.00

Coffee

40.00

40.00

Colquitt

40.00

40.00

Columbia

40.00

38.43

Cook Coweta

37.96 37.47

37.96 37.3477

Crawford

34.94

40.00

Crisp

37.76

40.00

Dade

40.00

40.00

Dawson

40.00

40.00

Decatur

40.00

40.00

Dekalb

37.67

37.67

Dodge

32.87

32.87

Dooly

40.00

40.00

Dougherty

40.00

40.00

Douglas

37.46

37.46

Early

37.37

37.37

Echols

36.07

36.07

Effingham

40.00

40.00

Elbert

35.02

40.00

Emanuel

35.69

35.69

STATE WIDE AVERAGE: 37.40

County
Evans Fannin Fayette Floyd Forsyth Franklin Fulton Gilmer Glascock Glynn Gordon Grady Greene Gwinnett Habersham Hall Hancock Haralson Harris Hart Heard Henry Houston Irwin Jackson Jasper Jeff Davis Jefferson Jenkins Johnson Jones Lamar Lanier Laurens Lee Liberty Lincoln Long Lowndes Lumpkin Macon Madison Marion McDuffie McIntosh Meriwether Miller Mitchell Monroe Montgomery Morgan Murray Muscogee

Proposed Ratio 40.00 36.11 37.74 36.77 37.04 31.29 35.50 26.20 37.26 36.29 36.51 37.70 40.00 40.00 40.00 37.58 40.00 37.72 40.00 40.00 37.22 37.61 37.95 37.90 33.84 37.93 40.00 40.00 34.79 32.02 35.29 33.74 40.00 40.00 40.00 36.71 32.11 36.09 40.00 35.13 36.97 37.57 40.00 40.00 34.01 37.40 33.63 40.00 36.58 36.37 37.52 40.00 40.00

Final Ratio
40.00 36.11 40.00 40.00 37.04 31.29 37.14 26.20 37.26 36.29 36.51 37.70 40.00 40.00 40.00 37.58 40.00 37.72 40.00 40.00 40.00 40.00 37.27 37.90 40.00 37.93 40.00 40.00 34.79 32.02 35.29 33.74 40.00 40.00 40.00 36.71 32.11 36.09 40.00 35.13 36.97 37.57 40.00 40.00 34.01 40.00 33.63 40.00 36.58 36.37 40.00 40.00 40.00

County
Newton Oconee Oglethorpe Paulding Peach Pickens Pierce Pike Polk Pulaski Putnam Quitman Rabun Randolph Richmond Rockdale Schley Screven Seminole Spalding Stephens Stewart Sumter Talbot Taliaferro Tattnall Taylor Telfair Terrell Thomas Tift Toombs Towns Treutlen Troup Turner Twiggs Union Upson Walker Walton Ware Warren Washington Wayne Webster Wheeler White Whitfield Wilcox Wilkes Wilkinson Worth

Proposed Ratio 40.00 40.00 40.00 40.00 36.77 40.00 40.00 34.03 40.00 33.81 40.00 40.00 40.00 33.05 40.00 40.00 33.70 33.31 33.37 37.59 40.00 37.97 40.00 35.26 36.25 36.03 35.91 40.00 35.91 40.00 40.00 40.00 40.00 35.00 40.00 40.00 32.91 40.00 40.00 40.00 40.00 40.00 36.89 37.42 40.00 40.00 37.81 37.22 37.29 40.00 34.62 36.90 40.00

Final Ratio
40.00 40.00 40.00 40.00 36.77 40.00 40.00 34.03 40.00 33.81 40.00 40.00 40.00 33.05 40.00 40.00 40.00 33.31 40.00 37.59 40.00 37.97 40.00 35.84 36.25 36.03 36.01 40.00 35.91 40.00 40.00 40.00 40.00 35.00 40.00 40.00 32.91 40.00 40.00 40.00 40.00 40.00 40.00 37.42 40.00 40.00 37.81 37.22 37.29 40.00 34.62 36.90 40.00

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Figure 12 below shows the trend of the statewide proposed public utility equalization ratios. The graph indicates that, even though the statewide average has been declining since 1995, the 2000 average is starting to show an upward trend.

Figure 12 - Trend of Average Proposed Public Utility Equalization Ratio

39.00% 38.50% 38.00% 37.50% 37.00% 36.50%

38.78% 1995

37.80% 1996

37.86%

37.42%

1997

1998

Tax Year

37.27% 1999

37.40% 2000

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PREFERENTIAL AGRICULTURAL ASSESSMENT

In the 1983 legislative session, O.C.G.A. 48-5-7.1 was passed establishing preferential assessment of tangible real property devoted to bona fide agricultural purposes.

By statute, all real property is assessed at 40% of fair market value, however, the new legislation provided for a 30% level of assessment or 75% of the value at which other taxable real property is assessed. Property devoted to bona fide agricultural purposes is defined as:

I.

Tangible real property where the primary use is good faith production of

agricultural products including:

a.

horticultural

b.

floricultural

c.

forestry

d.

dairy

e.

livestock

f.

poultry

g.

apiarian products and all other forms of farm products

h.

$100,000 or less of the fair market value of real property devoted to the storage or

processing of agricultural products.

i.

excludes the value of any residence located on the property.

II.

Property qualifying for preferential assessment is limited to 2000 acres and must be owned

by either

a.

one or more natural or naturalized citizens;

b.

a family farm corporation, owned by related individuals and deriving at least 80% of its

gross income from agricultural pursuits on property located in Georgia.

In making application for preferential assessment, qualifying taxpayers must have signed a covenant (contract) agreeing to continuously maintain the property in agricultural pursuits for a period of 10 years. Transfers of ownership were allowed, provided the property was transferred to another qualifying entity that agreed to continue the property in agricultural pursuits for the remainder of the covenant period. Otherwise, the covenant was breached and a penalty imposed. Penalties ranged from 15 times the tax savings if the breach occurred during the first year of the covenant, to a minimum of 3 times the tax savings if a breach occurred during the tenth year of the covenant.

Since the passage of HOUSE BILL 230, several amendments have affected the provisions of preferential assessment.

I.

In 1985, the General Assembly amended the statute to allow transfers of property under

preferential assessment without a penalty being assessed. These types of transfers

included:

a.

up to 3 acres of land, to be used for residential purposes and occupied by parties related

to the covenant holder;

b.

mineral exploration; and

c.

for purposes of land conservation, federal agricultural assistance programs or for agricultural

management purposes.

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II.

The amendment also reduced the penalty to the actual tax savings realized during the

covenant for breaches occurring as a result of foreclosure.

III.

A 1986 amendment added a provision allowing a reduced penalty of the actual tax savings

for breaches occurring as a result of an owner becoming medically unable to continue the

property in agricultural uses.

IV. In 1987, the statute was again amended to relax the penalties for covenant breaches. Rather than penalties being assessed at 3 times all years tax savings, the amendment set up a penalty amount of only one year's tax savings times a factor of 2 to 5 depending on the year of the covenant in which the breach occurred.

Currently, the preferential assessment program will allow a covenant holder to transfer up to 5 acres of land to be used for residential purposes and occupied by parties related to the covenant holder.

Fiscal Impact

The Table 2 below shows for each tax year, since the beginning of this program, the statewide number of parcels, the total value eliminated, the total tax dollar loss, and the percentage change of each category.

Table 2 - Preferential Assessment Fiscal Impact

YEAR 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

PARCELS 10,001 11,839 12,642 13,446 15,306 16,978 19,947 23,086 23,243 18,388 17,836 22,226 23,501 23,915 23,340 22,634

PERCENT CHANGE
N/A + 18.4 + 6.8 + 6.4 + 13.8 + 10.9 + 17.5 + 15.7 + .7 - 20.9 - 3.0 + 24.6 + 5.7 + 1.8 - 2.4
-3.02

TOTAL

VALUE

ELIMINATED

86,969,884

105,327,904

115,411,332

119,970,016

134,584,711

148,115,075

176,780,216

204,261,412

180,985,796

145,151,076

137,170,751

165,278,063

174,157,485

181,350,311

189,169,970

191,204,332

PERCENT CHANGE
N/A + 21.1 + 9.6 + 3.9 + 12.2 + 10.1 + 19.4 + 15.5 - 11.4 - 9.8 - 5.5 + 20.5 + .4 + 4.1 + 4.3 +1.08

TOTAL TAX DOLLAR LOSS
1,588,974 1,992,707 2,227,704 2,370,396 2,864,733 3,782,095 4,010,259 4,657,783 4,232,187 3,542,375 3,362,403 4,249,807 4,410,076 4,654,542 4,701,626 4,760,183

PERCENT CHANGE

N/A + 25.4 + 11.8 + 6.4 + 20.9 + 32.0 + 6.0 + 16.1 - 9.1 - 16.3 - 5.1 + 26.4 + 3.8 + 5.5 + 1.01 +1.25

The Department will continue to monitor this program and provide data each year as required by law.
Table 3 on the following page illustrates a county by county breakdown of the preferential agricultural assessment local impact analysis for 1999.
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TABLE 3 PREFERENTIAL AGRICULTURAL ASSESSMENT FOR 1999

COUNTY
APPLING ATKINSON BACON BAKER BALDWIN BANKS BARROW BARTOW BEN HILL BERRIEN BIBB BLECKLEY BRANTLEY BROOKS BRYAN BULLOCH BURKE BUTTS CALHOUN CAMDEN CANDLER CARROLL CATOOSA CHARLTON CHATHAM CHATTAHOOCHEE CHATTOOGA CHEROKEE CLARKE CLAY CLAYTON CLINCH COBB COFFEE COLQUITT COLUMBIA COOK COWETA CRAWFORD CRISP DADE DAWSON DECATUR DEKALB DODGE DOOLY DOUGHERTY DOUGLAS EARLY ECHOLS EFFINGHAM ELBERT EMANUEL EVANS FANNIN FAYETTE FLOYD FORSYTH FRANKLIN FULTON GILMER GLASCOCK GLYNN GORDON GRADY

PARCEL
COUNT
397 374
69 276
31 50 44 48 32 372 17 46 106 487 33 42 520 73 344 23 150 131 20 61
0 18 52
3 0 182 0 154 0 124 67 21 21 100 115 374 79 12 779 1 196 451 22 3 368 188 38 234 408 132 2 0 46 60 15 48 69 111 10 208 509

VALUE
ELIMINATED
2,071,411 2,409,663
435,210 3,558,914
364,917 637,705 469,592 603,887 371,836 2,428,041
66,014 523,646 486,589 3,398,564 287,850 348,526 5,216,412 383,273 4,171,084 295,511 1,035,474 1,397,680 175,316 344,141
0 172,171 676,344
60,930 0
1,555,035 0
1,043,927 0
1,311,204 914,607 356,583 252,111 507,354 794,201
2,673,106 751,449 371,517
7,913,517 32,480
1,101,228 3,357,054
746,970 42,934
3,292,405 868,306 296,255
1,310,860 2,701,856 1,059,742
24,800 0
304,358 800,080
78,240 780,648 482,040 803,403 341,836 1,113,152 6,868,535

STATE
TAX LOSS
518 602 109 890
91 159 117 151
93 607
17 131 122 850
72 87 1,304 96 1,043 74 259 349 44 86
0 43 169 15
0 389
0 261
0 328 229
89 63 127 199 668 188 93 1,978
8 275 839 187
11 823 217
74 328 675 265
6 0 76 200 20 195 121 201 85 278 1,717
20

COUNTY
TAX LOSS
20,362 37,303
5,658 34,061
4,660 3,986 2,956 4,230 5,206 32,172
894 4,802 7,601 36,363 2,073 3,433 26,083 6,500 44,511 4,099 11,282 6,430
479 3,978
0 298 5,549 363
0 23,824
0 11,671
0 8,287 10,838 2,746 1,765 2,702 11,714 34,614 4,697 2,318 79,135
369 11,012 44,481
8,291 407
21,982 10,793
2,549 10,987 33,018
7,457 157 0
3,305 2,104
646 10,686
3,579 10,891
2,389 8,516 46,500

SCHOOL
TAX LOSS
32,086 31,930
5,440 59,790
6,076 7,908 9,557 11,148 6,879 25,494 1,314 6,415 7,513 47,274 4,893 3,625 61,293 6,753 35,162 4,433 12,943 24,879 2,279 4,959
0 1,863 6,358 1,239
0 16,095
0 14,615
0 21,307
8,140 6,244 3,719 10,213 14,693 43,318 9,799 4,718 97,732
730 14,316 56,399 13,221
777 42,801 11,330
4,900 20,318 28,369 11,657
328 0
5,128 13,361
1,108 16,207
6,300 11,416
5,982 19,458 94,786

SPECIAL
TAX LOSS
0 0 0 0 0 510 822 0 0 0 198 0 18 22 0 0 11,994 0 0 254 0 0 0 1,527 0 0 0 152 0 0 0 4,959 0 0 1,994 0 0 1,228 0 2,415 0 0 0 124 0 0 5,154 0 0 0 505 0 3,501 0 0 0 380 800 0 3,552 0 0 235 0 0

TOTAL TAX
LOSS
52,966 69,835 11,207 94,741 10,827 12,563 13,452 15,529 12,178 58,273
2,423 11,348 15,254 84,509
7,038 7,145 100,674 13,349 80,716 8,860 24,484 31,658 2,802 10,550
0 2,204 12,076 1,769
0 40,308
0 31,506
0 29,922 21,201
9,079 5,547 14,270 26,606 81,015 14,684 7,129 178,845 1,231 25,603 101,719 26,853 1,195 65,606 22,340 8,028 31,633 65,563 19,379
491 0
8,889 16,465
1,774 30,640 10,000 22,508
8,691 28,252 143,003

COUNTY
GREENE GWINNETT HABERSHAM HALL HANCOCK HARALSON HARRIS HART HEARD HENRY HOUSTON IRWIN JACKSON JASPER JEFF DAVIS JEFFERSON JENKINS JOHNSON JONES LAMAR LANIER LAURENS LEE LIBERTY LINCOLN LONG LOWNDES LUMPKIN MACON MADISON MARION MCDUFFIE MCINTOSH MERIWETHER MILLER MITCHELL MONROE MONTGOMERY MORGAN MURRAY MUSCOGEE NEWTON OCONEE OGLETHORPE PAULDING PEACH PICKENS PIERCE PIKE POLK PULASKI PUTNAM QUITMAN RABUN RANDOLPH RICHMOND ROCKDALE SCHLEY SCREVEN SEMINOLE SPALDING STEPHENS STEWART SUMTER TALBOT TALIAFERRO TATTNALL TAYLOR TELFAIR TERRELL THOMAS

PARCEL
COUNT
87 1
84 0
456 168 119 124
49 57 56 347 111 66 76 108 278 40 101 46 145 338 72 45 32 107
3 3 351 213 156 123 24 179 52 168 30 363 57 60 19 7 11 339 6 23 45 343 5 41 163 42 80 114 200 15 122 103 506 135 98 5 140 566 120 156 474 348 369 290 48

VALUE
ELIMINATED
736,755 170,130 1,598,791
0 2,956,813
988,140 1,258,390 1,825,849
212,858 883,184 696,404 2,239,947 1,177,225 1,123,871 1,215,929 1,125,798 1,683,423 215,168 947,220 406,232 1,095,616 1,908,646 2,140,603 288,020 276,521 1,049,514
27,372 19,531 2,885,720 1,894,694 1,300,173 1,481,543 96,929 1,921,514 685,324 2,816,822 336,237 1,696,040 1,265,832 436,495 203,398 79,900 133,981 2,835,071 233,401 262,756 667,934 3,011,284 47,584 386,888 1,321,093 608,056 842,698 1,498,489 1,097104 105,560 334,450 605,268 4,005,458 1,152,243 1,469,764 66,960 1,126,399 4,958,973 813,759 955,293 2,995,244 2,750,633 2,114,387 2,348 ,261 1,474,409

STATE
TAX LOSS
184 43
400 0
739 247 315 456
53 221 174 560 294 281 304 281 421
54 237 102 274 477 535
72 69 262
7 5 721 474 325 370 24 480 171 704 84 424 316 109 51 20 33 709 56 66 167 753 12 97 330 152 211 375 274 26 84 151 1,001 288 367 17 282 1,240 203 239 749 688 529 587 369

COUNTY
TAX LOSS
7,110 1,574 12,112
0 91,514
9,020 8,252 9,700 1,939 9,916 6,205 24,975 8,957 15,870 9,290 12,946 23,652 2,952 9,453 3,352 8,430 12,407 29,969 3,462 3,551 17,245
202 190 31,290 16,915 9,378 11,630 946 14,617 11,198 43,970 2,438 14,796 12,620 2,532 1,758 785 1,194 16,982 1,707 3,905 4,008 22,895 380 4,227 16,170 6,081 10,677 12,154 8,898 623 4,334 7,427 51,973 10,924 14,257 505 14,576 49,590 13,597 17,118 46,456 25,586 19,241 30,997 6,605

SCHOOL
TAX LOSS
8,104 3,360 16,771
0 49,734 13,794 20,701 27,572
2,820 18,989
8,677 37,385 22,522 19,577 15,503 12,271 18,198
2,959 11,178
6,780 20,236 25,061 33,350
5,127 4,162 16,478
393 312 45,017 23,324 17,877 17,779 1,478 30,264 11,479 27,277 3,974 23,562 20,253 6,329 4,753 1,568 2,204 35,438 4,200 4,073 12,377 41,767 558 5,688 19,816 7,108 14,848 10,253 20,220 2,171 7,679 11,566 60,883 17,618 26,485 992 13,168 71,360 12,166 15,657 41,095 30,257 23,808 34,285 15,924

SPECIAL
TAX LOSS
0 510 959
0 0 0 0 0 0 2,649 467 2,218 1,543 0 0 563 0 0 0 0 0 0 0 1,152 471 0 0 0 0 303 0 0 73 0 0 0 0 0 0 0 772 213 0 0 0 0 0 0 0 0 1,321 0 0 0 0 156 0 0 0 864 4,527 0 0 4,261 0 0 0 0 0 0 3,434

TOTAL TAX
LOSS
15,398 5,487
30,242 0
141,987 23,061 29,268 37,728 4,812 31,775 15,523 65,048 33,316 35,728 25,097 26,061 42,271 5,965 20,868 10,234 28,940 37,945 63,854 9,813 8,253 33,985 602 507 77,028 41,016 27,580 29,779 2,521 45,361 22,848 71,951 6,496 38,782 33,189 8,970 7,334 2,586 3,431 53,129 5,963 8,044 16,552 65,415 950 10,012 37,637 13,341 25,782 22,784 29,392 2,976 12,097 19,144
113,857 29,694 45,636 1,514 28,026
126,451 25,966 33,014 88,300 56,531 43,578 65,869 26,332

21

COUNTY
TIFT TOOMBS TOWNS TREUTLEN TROUP TURNER TWIGGS UNION UPSON WALKER WALTON WARE WARREN WASHINGTON WAYNE WEBSTER WHEELER WHITE WHITFIELD WILCOX WILKES
TOTAL

PARCEL
COUNT
1 160
2 177
82 56 291
1 13 57 102 313 260 171 237 101 314 39 182 669 310

VALUE
ELIMINATED
5,392 834,400
36,530 846,418 575,433 660,327 1,179,078
20,635 79,107 733,688 1,417,701 1,479,302 1,426,359 1,050,031 1,815,438 1,072,164 1,645,044 435,668 1,717,375 4,579,654 2,370,787

STATE
TAX LOSS
1 209
9 212 144 165 295
5 20 183 354 370 357 263 454 268 430 109 429 1,145 593

22,720 191,175,426

47,795

COUNTY TAX LOSS
48 4,612
219 12,801
5,081 9,000 16,229
100 880 1,849 14,829 19,971 12,980 10,398 22,512 11,954 15,001 1,956 3,528 64,115 18,257
1,934,284

SCHOOL TAX LOSS
74 12,516
146 9,988 10,231 8,254 20,575
175 1,270 10,059 26,189 24,083 23,564 20,003 25,053 13,670 17,644 6,530 31,943 57,749 39,782
2,703,405

SPECIAL TAX LOSS
0 834
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
68,523

TOTAL TAX LOSS
123 18,171
374 23,001 15,456 17,419 37,099
280 2,170 12,091 41,372 44,424 36,901 30,664 48,019 25,892 33,075 8,595 35,900 123,009 58,632
4,754,007

Figure 13 below and Figure 14 on the following page illustrate, since 1989, the amount of revenue loss and the ever-increasing amount of value removed annually from digests affected by the Preferential Agricultural Assessment program.

Figure 13 - Preferential Agricultural Assessment Revenue

6.0

4.0

2.0 3.8

4.1

4.7 4.2

3.5 3.4

4.2 4.4 4.6

4.7 4.8

0.0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Tax Year

22

Figure 14 - Preferential Agricultural Assessed Value Eliminated

250.0

200.0 150.0 100.0
50.0

148.1 176.8

204.2 181.0 145.1 137.1

165.3 174.1 181.3 189.2 191.2

0.0

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

Tax Year

23

Conservation Use Valuation

In 1991 the Legislature embraced the "current use" valuation concept. This bill provided for the assessment for ad valorem tax purposes of certain qualifying properties based on current use value rather than fair market value. The bill also provided for the Commissioner to develop a table of current use values to be used in all counties, which results from a legislative formula taking into account the amount of income the land is capable of producing when growing certain crops and timber, and factors founded in market data using only farmer to farmer land sales.
The data is grouped into nine agricultural districts in Georgia. Tax year 1998 was the seventh year of the conservation use program, where county tax digests are continuing to show that taxpayers are continuing to take advantage of this preferential assessment program.
Unlike the Preferential Agricultural Assessment Program in which assessments are based on 30% of fair market value rather than 40% of fair market value statewide, the valuation of property in Conservation Use Covenants is most significant in the Urban Areas of North Georgia and other parts of the State where strong residential and commercial development is occurring. As a result, agricultural landowners' interest is greatest in these transitional areas.
Because the statute requires the Commissioner to develop the annual table of land values for use by the counties, a significant increase in the responsibilities of the Property Tax Division field staff occurred. The man-hours required of the staff in performing this responsibility currently consume 25% of the staff's time.
Accordingly, there has been a cutback in the amount of technical assistance the Department can provide to the appraisal of non-operating public utility property, as is also required by statute. This understaffing is the motivation behind the Department's request for funding approval in the supplemental budget for 6 additional appraisers.
Several reports, graphs, and charts are being included in this report to show the fiscal impact of conservation use valuation.
Table 4 below represents the 10 counties most affected by Conservation Use Assessment Covenants. Shown in this table is a listing by county of the number of applications (parcel count), assessed value eliminated from the digest, the amount of tax loss for each of the tax types, and the total tax loss. The total amount of tax loss in these 10 counties accounts for approximately 40% of the total amount of tax loss statewide.

COUNTY
CHEROKEE GWINNETT HENRY MORGAN BARROW JACKSON HALL OCONEE PAULDING FORSYTH

TABLE 4 CONSERVATION USE FISCAL IMPACT

PARCEL COUNT
2,023 559
1,012 905
1,328 1,138 1,850 1,217
869 888

VALUE ELIMINATED
130,322,960 75,580,510 60.946,825 78,655,147 63,792,722 62,666,269 75,710,855 57,820,903 53,118,112 67,940,960

STATE TAX LOSS
32,581 18,895 15,237 19,664 15,948 15,667 18,928 14,455 13,280 16,985

COUNTY TAX LOSS
775,421 699,121 687,844 784,191 402,502 478,206 492,121 516,581 405,823 178,685

SCHOOL TAX LOSS
2,650,751 1,492,715 1,310,356 1,258,482 1,297,834 1,191,485 1,025,928
951,154 998,621 1,134,614

24

SPECIAL TAX LOSS
319,901 225,210 182,841
0 111,329
76,006 190,389
0 0 67,941

TOTAL TAX LOSS
3,778,654 2,435,941 2,196,278 2,062,337 1,827,613 1,761,364 1,727,366 1,482,190 1,417,724 1,398,225

Table 5 provides a listing of each county and the number of parcels receiving Conservation Use Assessment, the amount of value eliminated from the taxable digest in each county and the tax dollar loss in each appropriate taxing district (State, County, School, Special) and the total tax dollar loss. Special districts include Hospital Authorities, Fire Districts, Industrial Authorities,
TABLE 5 CONSERVATION USE VALUATION ASSESSMENT FOR 1998

COUNTY
APPLING ATKINSON BACON BAKER BALDWIN BANKS BARROW BARTOW BEN HILL BERRIEN BIBB BLECKLEY BRANTLEY BROOKS BRYAN BULLOCH BURKE BUTTS CALHOUN CAMDEN CANDLER CARROLL CATOOSA CHARLTON CHATHAM CHATTAHOOCHEE CHATTOOGA CHEROKEE CLARKE CLAY CLAYTON CLINCH COBB COFFEE COLQUITT COLUMBIA COOK COWETA CRAWFORD CRISP DADE DAWSON DECATUR DEKALB DODGE DOOLY DOUGHERTY DOUGLAS EARLY ECHOLS EFFINGHAM ELBERT EMANUEL EVANS FANNIN FAYETTE FLOYD FORSYTH FRANKLIN

PARCEL
COUNT
33 45 153
3 373 630 1,328 743 161
52 15 235 99 135 167 1,573
0 720
0 199 270 1,329 292 324
53 0
470 2,023
185 2
153 0
742 674 1,252 3,218 392 1,030 145
42 66 435
6 2,020
0 28 66 212 24 15 782 234 15
7 798 245 765 888 1,216

VALUE
ELIMINATED
187,034 96,360
1,151,095 13,437
4,088,750 41,341,412 63,792,722 21.001,268
1,681,140 234,850
1,255,277 4,947,705
640,802 2,740,339 3,204,640 24,970,800
0 16,373,266
0 3,895,882 4,095,575 40,726,725 11,678,637 3,553,085 3,321,897
0 10,616,269 130,322,960
5,142,691 44,050
3,859,008 0
42,536,087 13,918,083 13,902,904 37,340,037
6,786,596 15,411,602
1,227,267 291,921
1,396,241 35,024,677
129,367 774,220
0 211,509 2,881,040 8,146,266 213,284 157,021 11,819,870 1,958,596
41,686 63,751 20,749,721 12,735,624 8,607,178 67,940,960 14,694,809

STATE
TAX LOSS
47 24 288
3 1,022 10,335 15,948 5,250
420 59
314 1,237
160 685 801 6,243
0 4,093
0 974 1,024 10,182 2,920 888 830
0 2,654 32,581 1,286
11 965
0 10,634
3,480 3,476 9,335 1,697 3,853
307 73
349 8,756
32 194
0 53 720 2,037 53 39 2,955 490 10 16 5,187 3,184 2,152 16,985 3,674
25

COUNTY
TAX LOSS
1,839 1,546 14,964
129 52,214 258,384 402,502 146,670 23,536
3,112 17,006 45,510 10,047 29,305 23,074 245,963
0 277,691
0 54,035 44,839 187,343 31,991 41,186 36,574
0 86,361 775,421 69,170
675 15,861
0 306,260
87,962 165,115 287,518
47,506 81,492 18,127
3,780 8,727 218,554 1,293 8,795
0 2,802 31,980 77,227 1,423 1,952 101,710 16,413
510 446 131,138 117,180 93,474 178,685 121,366

SCHOOL
TAX LOSS
2,897 1,277 14,389
226 68,078 512,634 1,297,834 384,716 31,101
2,466 24,981 60,609
9,894 38,118 54,479 259,697
0 288,497
0 58,438 51,195 716,697 151,822 51,200 65,873
0 99,571 2,650,751 96,425
456 70,774
0 738,147 226,169 123,736 653,824 100,102 310,235
22,704 4,731
18,207 444,813
1,598 17,404
0 3,553 50,994 147,447 2,773 2,049 195,501 30,358
438 701 574,519 299,669 144,575 1,134,614 208,078

SPECIAL TAX LOSS
0 0 0 0 0 33,073 111,329 0 0 0 3,766 0 244 0 0
0 0 0 3,246 0 0 0 15,776 6,134 0 0 319,901 1,286 0 17,453 0 179,519 0 30,159 0 0 38,305 0 253 0 0 0 2,958 0 0 19,108 0 0 0 20,177 0 54 0 0 0 10,678 67,941 0

TOTAL TAX
LOSS
4.783 2.847 29.641
358 121.314 814.426 1,827.613 536.636
55.057 5.637
46.067 107.356
20.345 68.108 78.354 511.903
0 570.281
0 116.693
97.058 914.222 186.733 109.050 109.411
0 188.586 3,778.654 168.167
1.142 105.053
0 1,234.560
317.611 322.486 950.677 149.305 433.885
41.138 8.837
27.283 672.123
2.923 29.351
0 6,408 102,802 226,711 4,249 4,040 320,343 47,261 1,012 1,163 410,844 420,033 250,879 1,398,225 333,118

COUNTY
FULTON GILMER GLASCOCK GLYNN GORDON GRADY GREENE GWINNETT HABERSHAM HALL HANCOCK HARALSON HARRIS HART HEARD HENRY HOUSTON IRWIN JACKSON JASPER JEFF DAVIS JEFFERSON JENKINS JOHNSON JONES LAMAR LANIER LAURENS LEE LIBERTY LINCOLN LONG LOWNDES LUMPKIN MACON MADISON MARION MCDUFFIE MCINTOSH MERIWETHER MILLER MITCHELL MONROE MONTGOMERY MORGAN MURRAY MUSCOGEE NEWTON OCONEE OGLETHORPE PAULDING PEACH PICKENS PIERCE PIKE POLK PULASKI PUTNAM QUITMAN RABUN RANDOLPH RICHMOND ROCKDALE SCHLEY SCREVEN SEMINOLE SPALDING STEPHENS STEWART SUMTER TALBOT TALIAFERRO

PARCEL
COUNT
365 937
6 66 1,044 206 401 559 741 1,850 241 314 388 429 360 1,012 228 610 1,138 819
3 722
6 312 177 283
11 14 210 23 193 49 266 724
9 562
6 178
42 977
35 974 318
30 905 246
69 1,028 1,217
35 869 120 255
59 511 549
6 203
0 319
0 156 719
0 16
7 342 267
5 23 982
4

VALUE
ELIMINATED
18,408,660 18,855,960
54,523 1,912,509 23,974,302 8,780,588 6,341,892 75,580,510 44,772,256 75,710,855 2,135,050 5,954,720 10,490,504 16,380,432 13,746,981 60,946,825 12,806,402 6,551,583 62,666,269 28,750,122
169,804 13,391,192
99,885 1,102,840 2,860,074 4,916,988
75,327 104,208 11,264,949 274,540 1,008,688 598,759 9,981,205 32,726,359
30,563 9,021,046
69,517 3,832,865 1,457,643 40,510,838
366,338 45,654,447
5,512,023 241,616
78,655,147 4,308,744 3,392,243
36,863,617 57,820,903
508,156 53,118,112
2,731,542 11,062,496
1,133,685 10,585,747 11,383,510
16,966 6,997,617
0 18,230,104
0 2,728,253 6,098,312
0 98,693 54,,916 15,982,947 7,511,776 43,732 353,927 10,374,865 21,824

STATE
TAX LOSS
4,602 4,714
14 478 5,994 2,195 1,585 18,895 11,193 18,928 534 1,489 2,623 4,095 3,437 15,237 3,202 1,638 15,667 7,188
42 3,348
25 276 715 1,229
19 26 2,816 69 252 150 2,495 8,182
8 255
17 958 364 10,128
92 11,414
1,378 60
19,664 1,077 848 9,216
14,455 127
13,280 683
2,766 283
2,646 2,846
4 1,749
0 4,558
0 682 1,525
0 25 14 3,996 1,878 11 88 2,594
5
26

COUNTY
TAX LOSS
252,015 112,389
739 13,368 183,403 59,445 61,199 699,121 338,440 492,121 66,080 54,446 68,657 87,063 124,204 687,844 114,105 73,050 478,206 405,973
1,404 153,999
1,403 15,112 28,544 40,565
578 677 157,709 3,300 12,952 9,857 74,266 319,082 331 80,665 501 30,126 14,212 305,518 5,986 712,666 39,962 2,105 784,191 24,991 29,309 362,001 516,581 3,060 405,823 40,591 66,375 8,616 84,623 124,365 208 69,977
0 147,852
0 16,124 79,034
0 1,308
521 155,035
56,639 566
3,539 173,364
4391

SCHOOL
TAX LOSS
382,164 246,448
775 33,469 416,704 121,172 69,761 1,492,715 469,661 1,025,928 35,911 83,116 172,569 247,360 182,147 1,310,356 159,568 109,346 1,191,485 500,827
2,165 145,964
1,080 15,164 33,749 82,065
1,391 1,368 175,508 4,887 15,181 9,401 143,130 523,622
477 111,049
956 45,994 22,229 638,046
6,136 444,891
65,152 3,305
1,258,482 62,477 79,277
720,684 951,154
6,352 998,621
42,339 204,988
15,724 124,171 167,360
254 81,802
0 124,730
0 56,121 140,018
0 1,500
840 288,013 111,325
511 5,093 155,105
358

SPECIAL
TAX LOSS
80,006 0 0
3,209 0 0 0
225,210 26,863
190,389 0 0 0 0 0
182,841 8,580 6,224
76,006 0 0
6,696 0 0 0 0 0 0 0
1,098 1,715
0 0 0 0 1,443 0 0 1,093 0 0 0 0 0 0 0 6,304 97,274 0 0 0 0 0 0 0 0 17 0 0 0 0 3,827 0 0 0 41 47,805 0 0 524,588 0 0

TOTAL TAX
LOSS
718,787 363,551
1,528 50,524 606,101 182,812 132,545 2,435,941 846,157 1,727,366 102,525 139,051 243,849 338,518 309,788 2,196,278 285,455 190,258 1,761,364 913,988
3,611 310,007
2,508 30,552 63,008 123,859
1,988 2,071 336,033 9,354 30,100 19,408 219,891 850,886
816 195,412
1,474 77,078 37,898 953,692 12,214 1,168,971 106,492
5,470 2,062,337
88,545 115,738 1,189,175 1,482,190
9,539 1,417,724
83,613 274,129
24,623 211,440 294,571
483 153,528
0 277,140
0 76,754 220,577
0 2,833 1,416 494,849 169,842 1,088 9,244 331,063
754

COUNTY
TATTNALL TAYLOR TELFAIR TERRELL THOMAS TIFT TOOMBS TOWNS TREUTLEN TROUP TURNER TWIGGS UNION UPSON WALKER WALTON WARE WARREN WASHINGTON WAYNE WEBSTER WHEELER WHITE WHITFIELD WILCOX WILKES WILKINSON WORTH
TOTAL

PARCEL
COUNT
37 2 4 7
701 740
2 181
0 621 861
0 640 396 309 757
18 56
1 438
47 2
718 14 7
460 301 864

VALUE
ELIMINATED
229,687 47,730 16,638
113,336 24,417,559 23,263,946
9,967 4,966,446
0 9,616,364 15,477,964
0 26,278,669
6,682,733 12,515,729 43,845,686
73,358 179,890
1,157 3,261,948
675,012 15,515
33,291,320 222,093 72,514
5,359,800 4,326,297 18,299,753

STATE
TAX LOSS
57 12
4 28 6,104 5,816
2 1,242
0 2,404 3,869
0 6,570 1,671 3,129 10,961
18 45
0 815 169
4 8,323
56 18 1,340 1,082 4,575

60,116 1,977,369,595

494,345

COUNTY TAX LOSS
3,563 444 151
1,496 109,866 208,678
63 29,799
0 84,912 210,964
0 127,714
75,159 31,540 458,625
990 1,637
11 40,448
7,526 135
149,478 444
1,015 41,381 42,917 182,479
16,358,290

SCHOOL TAX LOSS
3,151 525 187
1,655 261,688 319,879
150 19,866
0 170,979 193,475
0 223,369 107,258 171,591 804,806
1,194 2,972
22 45,015
8,606 159
498,982 4,131 914
89,937 65,976 215,205
31,775,417

SPECIAL TAX LOSS
0 0 0 0 50,561 232 10 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6,039
1,905,367

TOTAL TAX LOSS
6,771 981 342
3,179 428,219 534,605
225 50,907
0 258,295 408,308
0 357,653 184,088 206,260 1,274,392
2,202 4,654
33 86,278 16,301
298 656,783
4,631 1,947 132,658 109,975 408,298
50,533,419

Figure 15 below and Figure 16 on the following page illustrates the amount of revenue loss, the ever increasing amount of value removed annually from digests affected by the Conservation Use Valuation program since 1993.

Figure 15 - Conservation Use Revenue Loss

60.00 50.00 40.00 30.00 20.00 10.00
0.00

15.80 1993

20.40

24.00

27.00

31.90

37.90

50.53

1994

1995

1996 Tax Year

1997

1998

1999

27

Figure 16 - Conservation Use Assessed Value Eliminated

2500.0 2000.0 1500.0 1000.0
500.0 0.0

651.0 1993

811.9 1994

920.7

1036.7

1472.4 1193.4

1995

1996 Tax Year

1997

1998

1977.4 1999

28

Timber Impact Report

Prior to 1992, timber was taxed annually as part of the tax digest. At that time, approximately 82 counties placed some value on standing timber, while other counties either did not tax timber at all or could not identify the value separate from the land value.
Along with Conservation Use Valuation, the amendment to the Georgia Constitution, which was approved by the electorate in 1991, also provided for a one-time assessment on harvested timber versus the annual taxation of timber as part of the value of real estate. Timber is now taxed once at its current value when harvested.
Pursuant to O.C.G.A. Section 48-5-7.4(s), Table 6 below and on the following page is the report required regarding timber revenue. This report shows the 1998 total assessed value (100%) of timber and the revenue for county and school purposes as reported on each county's 1999 digest.

Effective January 1, 1996, a change in the timber tax law affected the billing of owner harvests transactions and the Department's responsibility to develop average timber value tables. The Department now develops this table of values on an annual basis, rather than on a quarterly basis.

TABLE 6 1998 TIMBER REVENUE REPORTED ON 1999 TAX DIGESTS

COUNTY
APPLING ATKINSON BACON BAKER BALDWIN BANKS BARROW BARTOW BEN HILL BERRIEN BIBB BLECKLEY BRANTLEY BROOKS BRYAN BULLOCH BURKE BUTTS CALHOUN CAMDEN CANDLER CARROLL CATOOSA CHARLTON CHATHAM CHATTAHOOCHEE CHATTOOGA CHEROKEE CLARKE CLAY CLAYTON CLINCH COBB COFFEE COLQUITT COLUMBIA COOK COWETA CRAWFORD CRISP

ASSESSED
VALUE
10,574,342 9,016,212 3,995,045 2,392,810 4,753,720 920,175 422,456 1,784,054 3,445,871 5,896,968 1,045,630 1,783,152
10,678,357 2,573,991 4,855,332 8,632,957
10,778,433 2,100,000 1,408,992
15,270,012 1,734,159 4,646,026 538,572
15,188,408 3,112,813 695,075 792,993 2,842,546 604,461 2,560,148 771,443
15,000,000 207,068
9,407,392 4,775,848 5,686,669
953,751 4,700,068 3,266,193 3,359,503

COUNTY
TAX
93,371 115,669
51,936 23,533 60,705
6,947 3,380 12,381 49,965 78,135 14,202 20,631 167,514 26,770 34,959 83,394 51,736 39,816 17,598 258,980 17,116 24,160 1,897 193,365 36,233 1,418 7,014 16,913 8,130 38,632
631 142,650
1,522 50,235 65,119 43,788
6,896 25,547 48,176 39,474

SCHOOL
TAX
148,041 119,474
49,938 40,199 79,149
9,570 8,246 33,505 69,779 66,341 18,842 23,894 166,369 36,860 81,133 89,783 117,485 37,002 14,344 229,050 19,943 80,176 7,539 218,865 59,579 7,097 7,930 57,817 11,183 25,857 14,148 210,000 3,692 159,455 42,505 102,417 14,783 95,787 60,425 54,441

TOTAL
TAX
241,412 235,143 101,874
63,732 139,854
16,517 11,626 45,886 119,744 144,476 33,044 44,525 333,883 63,630 116,092 173,177 169,221 76,818 31,942 488,030 37,059 104,336
9,436 412,230
95,812 8,515
14,944 74,730 19,313 64,489 16,779 352,650
5,214 209,690 107,624 146,205
21,679 121,334 108,601
93,915

COUNTY
DADE DAWSON DECATUR DEKALB DODGE DOOLY DOUGHERTY DOUGLAS EARLY ECHOLS EFFINGHAM ELBERT EMANUEL EVANS FANNIN FAYETTE FLOYD FORSYTH FRANKLIN FULTON GILMER GLASCOCK GLYNN GORDON GRADY GREENE GWINNETT HABERSHAM HALL HANCOCK HARALSON HARRIS HART HEARD HENRY HOUSTON IRWIN JACKSON JASPER JEFF DAVIS

ASSESSED
VALUE
824,572 4,179,259 5,090,166
644,822 6,932,534 1,741,745 2,531,505 1,360,742 3,312,639 13,577,345 8,577,795 5,085,712 12,800,506
921,857 167,323 635,889 2,507,721 108,183 459,526 1,734,397 916,247 4,473,598 10,653,468 1,832,697 7,243,502 5,952,088 782,836 563,630 373,566 11,871,887 4,417,000 3,869,235 911,941 5,437,581 2,198,916 4,550,490 4,672,967 287,838 8,728,040 7,148,675

COUNTY
TAX
4,741 38,784 55,992
6,835 69,325 20,901 28,099 13,172 21,333 161,570 73,812 42,618 124,805
8,168 1,057 3,023 27,560
319 2,564 17,760 9,517 64,062 76,918 12,939 45,127 53,866 7,946 4,503 2,578 341,792 41,470 25,266 5,180 48,938 20,714 37,769 52,104 2,184 116,170 47,682

SCHOOL
TAX
11,486 75,227 65,409 14,496 90,123 29,261 44,808 24,629 37,764 177,157 139,818 73,743 134,405 12,906
1,991 15,255 42,255
1,931 6,507 34,592 10,638 63,570 182,814 32,109 97,787 68,687 14,210 6,194 5,447 199,685 63,269 63,649 14,910 85,642 47,277 56,699 77,992 5,578 132,492 91,146

TOTAL
TAX
16,227 114,011 121,401
21,331 159,448
50,162 72,907 37,801 59,097 338,727 213,630 116,361 259,210 21,074
3,048 18,278 69,815
2,250 9,071 52,352 20,155 127,632 259,732 45,048 142,914 122,553 22,156 10,697 8,025 541,477 104,739 88,915 20,090 134,580 67,991 94,468 130,096 7,762 248,662 138,828

29

TABLE 6 (Continued) 1998 TIMBER REVENUE REPORTED ON 1999 TAX DIGESTS

COUNTY
JEFFERSON JENKINS JOHNSON JONES LAMAR LANIER LAURENS LEE LIBERTY LINCOLN LONG LOWNDES LUMPKIN MACON MADISON MARION MCDUFFIE MCINTOSH MERIWETHER MILLER MITCHELL MONROE MONTGOMER MORGAN MURRAY MUSCOGEE NEWTON OCONEE OGLETHORPE PAULDING PEACH PICKENS PIERCE PIKE POLK PULASKI PUTNAM QUITMAN RABUN RANDOLPH

ASSESSED
VALUE
7,247,118 4,105,711 6,933,088 8,226,953 1,382,681 3,970,584 10,499,357 1,759,174 6,047,016 3,847,590 11,681,730 4,235,734
614,440 3,047,543 2,113,907 6,496,081 3,778,782 7,924,720 5,432,523
649,535 6,512,235 5,012,300 6,698,598 5,210,696 2,269,848
270,204 2,960,960 1,766,835 9,284,308 2,558,873
554,942 1,303,073 3,420,947 1,472,280 2,823,440 2,329,865 7,315,238 3,022,324
120,000 8,609,906

COUNTY
TAX
83,373 56,495 95,349 82,105 11,407 41,016 68,246 21,989 72,565 53,251 192,164 22,253
6,077 26,940 18,881 49,299 34,689 71,322 54,325 10,126 87,459 30,575 58,144 51,951 13,165
2,464 21,675 15,750 73,810 21,981
8,246 8,353 34,576 13,324 30,846 28,681 77,029 38,988 1,115 63,713

SCHOOL
TAX
83,342 44,383 95,330 104,071 22,386 73,337 137,857 27,408 107,637 57,906 183,403 57,278
9,628 47,542 24,733 92,569 51,014 120,852 92,353 10,717 47,214 60,950 93,111 78,160 30,643
6,288 58,124 29,241 125,338 56,039
8,602 17,722 50,869 18,610 38,687 34,948 86,320 53,042
946 160,403

TOTAL
TAX
166,715 100,878 190,679 186,176
33,793 114,353 206,103
49,397 180,202 111,157 375,567
79,531 15,705 74,482 43,614 141,868 85,703 192,174 146,678 20,843 134,673 91,525 151,255 130,111 43,808
8,752 79,799 44,991 199,148 78,020 16,848 26,075 85,445 31,934 69,533 63,629 163,349 92,030
2,061 224,116

COUNTY
RICHMOND ROCKDALE SCHLEY SCREVEN SEMINOLE SPALDING STEPHENS STEWART SUMTER TALBOT TALIAFERRO TATTNALL TAYLOR TELFAIR TERRELL THOMAS TIFT TOOMBS TOWNS TREUTLEN TROUP TURNER TWIGGS UNION UPSON WALKER WALTON WARE WARREN WASHINGTON WAYNE WEBSTER WHEELER WHITE WHITFIELD WILCOX WILKES WILKINSON WORTH STATE TOTAL

ASSESSED
VALUE
2174000 1125203 2805995 5358875
930123 2265239 1100402 5440252 4301200 4490777 3143373 5637161 3938265 10850280 6453232 4819093
999459 4764723
0 2943711 5146391 3236925 6723785
262966 1847478 1861875 3451669 17189930 7638864 16733426 12474884 4670122 12778378
654720 522364 6390742 6299538 7250000 6365450 711,804,094

COUNTY
TAX
12848 14583 33419 69505
5330 26164
8508 62781 32259 72616 52180 87489 32018 109588 85183 28676
8965 30936
0 45892 45443 44119 95343
1278 21177
5325 36898 206279 92430 168338 148451 57022 133406
3208 1045 99057 42540 71920 61999 7,631,634

SCHOOL TAX
44719 25835 40631 81455 14222 42224 16341 62400 57636 68619 47151 74411 36744 147781 94217 42393 11744 71471
0 37827 91503 40462 102202
2235 30945 23720 58195 279852 126194 306891 172153 60525 134173 10728
8932 86978 88194 110563 65310 10,362,780

TOTAL TAX
57567 40418 74050 150960 19552 68388 24849 125181 89895 141235 99331 161900 68762 257369 179400 71069 20709 102407
0 83719 136946 84581 197545
3513 52122 29045 95093 486131 218624 475229 320604 117547 267579 13936
9977 186035 130734 182483 127309 17,992,416

30

Figures 17 and 18 show the amount of timber value reported and the amount of tax levied for county and school tax purposes for the years 1993 through 1999.

Figure 17 - State Wide Timber Values

800.0 600.0 400.0 200.0
0.0

493.1 1993

555.8 1994

634.1

618.5

593.1

755.0

1995

1996
Tax Year

1997

1998

711.8 1999

Figure 18 - County and School Revenue from Timber

25.0 20.0 15.0 10.0
5.0 0.0

11.5 1993

16.1

15.9

15.1

13.4

1994

1995

1996 Tax Year

1997

19.3 1998

18.0 1999

31

Recommendations
Property Tax in Georgia is excellent due in large part to the dedication of the state and county staffs, however, the strain of maintaining a uniform and fair system with limited resources is beginning to show. Trends show assessment quality beginning to again deteriorate and the trend cannot be stopped without either another round of expensive revaluations in the next three years or a greater centralization of expertise that can be made available to counties. With the passage of conservation use, new digest review procedures, the development of public utility equalization ratios and the new method of timber taxation, The Governor's "Taxpayer Bill of Rights", and the "Homeowner Tax Relief Grants", the resources of the Property Tax Division of the Department have been exhausted to the point that it has become necessary to cut back severely on state provided services. This cut back of state provided services will continue unless additional staffing is provided to the Department to carry on the responsibilities of administering property tax.
The Department believes the following improvements will significantly reduce the cost to Georgians for funding our current system of taxation, while improving the uniformity of assessments:
1. Increase the number of field positions assigned to the administration of ad valorem tax from the current 15 positions
- The 15 Property Tax field positions are currently responsible for digest review, conservation use development, timber taxation, public utility review, satellite imagery, mass appraisal development and support, auditing of county digests, auditing of state tax collections, the training of assessors, appraisers, board of equalization members and tax commissioners, legislation review, development of rules and regulations, and special projects that have become more and more frequent. In addition to these ongoing responsibilities, the Governor's "Taxpayer Bill of Rights" (Senate Bill 177) and the "Homestead Tax Relief Grants" (House Bill 553) have caused the Department's resources to be strained to the point that a cutback in duties is beginning to take its toll.
Of the total 15 positions, there are currently only 10 field staff positions dedicated to the administration of the assessing functions of ad valorem tax; of which 2 of these 10 positions are dedicated entirely to instruction and the State's mass appraisal system. This leaves only 8 positions to assist 159 county boards of tax assessors in their responsibilities of maintaining uniform and equalized property values.
- The Governor's "Taxpayer Bill of Rights" has already required the Department to dedicate personnel time and resources to provide counties with the training and guidance in gearing up to implement the many changes required of local tax officials. It is estimated that these field appraisers spend approximately 20% of their time advising the county tax officials on the proper implementation of this new legislation. This has caused further strain to the Property Tax Division's staff.
- The development of the "Appraisal Procedures Manual" required in O.C.G.A. 269.1 has been an ongoing process for the last two years and will continue to require the Department to focus on this responsibility as legislation affecting the property tax process is passed. The manual currently contains some reserved sections that will need to be developed to include appeal procedures, county appraisal staff requirements, uniform assessment standards, and other responsibilities regarding property tax matters. This ongoing responsibility will almost certainly cause further cutbacks in the effectiveness of the Division staff.
32

- The Governor's "Homeowner Tax Relief Grants" legislation is currently administered by 5 Property Tax Division auditors who spend approximately 30% of their time advising the county tax officials on the provisions of this new legislation. The responsibilities of the staff auditors consist of insuring that the counties are properly and accurately providing taxpayers with the amount of credit contemplated in the Governor's legislation, that the grants are distributed to the counties timely, and that the current funding of $166 million is adequate to fund the program.
For these reasons, the Department recommends that 6 additional field appraisers and 2 additional field auditors be funded in future budgets.
2. Conduct Research Into Rapidly Evolving Technologies
- The past year has constituted a period of impressive change toward modernization of the Revenue Department, so as to provide accurate, fair and cost effective administration of the state tax laws. A commitment has been made to provide taxpayers and county tax officials with the information needed utilizing the most up-to-date technology available. This commitment has the future possibility of enhancing compliance and providing critical information for tax policy makers and those involved in taxpayer issues, as well as providing quality customer service to all interested parties. To this means, we have developed and continue to enhance a web site as a source of communication for public information services, and communication with other agencies and county tax officials. Current usage includes access to Codes, Rules and Regulations, electronic data regarding property tax procedures, homestead exemptions, filing requirements, county millage rates, digest values, motor vehicle valuations, and state and county telephone and address information. In the future, we see the web site allowing for the electronic filing of public utility returns and the distribution and transfer of mass appraisal updates. The possibilities are endless. Therefore, in order to comply with O.C.G.A. Section 48-5-270 which requires the Commissioner to actively seek out technological advancements and systems that will improve the uniformity, fairness, and efficiency of property valuations and assessments and include these recommendations in the annual budget request, we recommend that general discretionary funding for research and development of appraisal technologies in the form of computer systems, data collection systems and data distribution systems using the Internet be made available.
3. Reinstate Budget Funds for Minimum Staff Supplements
- Up until the early 1990's the Department's budget provided for funding of one-half of the salaries of state-required minimum appraisal staffs and special salary supplements for appraisers obtaining specialized training and proving expertise in appraisal skills. Although the statutory authority still exists, neither of these programs has been funded for the last several years. The Department believes there is benefit to be gained in reinstating the staff grants to counties to encourage proper staffing levels and assessment practices. The additional state tax collected on digests that do not meet the overall statistical measures is a viable source for funding these supplements.
33

The Department desires to provide to the legislature all information necessary for the proper evaluation of legislative impact and implementation of property tax policies. It is hoped this report can be a tool for further understanding the state of Property Tax Administration in Georgia. The staff of the Property Tax Division will be able to provide more information or clarification of information upon request. Respectfully Submitted, T. Jerry Jackson Revenue Commissioner
34