SOCIAL CIRCLE, Ga. — The Social Circle City Council voted unanimously to opt out of House Bill 581 on Feb. 18.
The bill, passed in last year’s state legislative session — and an associated constitutional amendment approved by voters statewide in November — set up a floating homestead exemption that limits increases in property valuations to the rate of inflation for the previous year, up to a maximum of 3 percent.
The legislation did, however, include an opt-out provision for local governments, provided they hold three public hearings in advance of voting to not participate in the new exemption. The Social Circle City Council held the city’s third public hearing as part of Tuesday’s council meeting.
The city councils in Loganville and Walnut Grove each voted recently to opt out of the floating homestead exemption, and the Monroe City Council was expected to take the same action at its final hearing on Thursday.
In municipalities across the state that have decided to opt out of the floating homestead exemption, a primary argument has been that it will significantly reduce revenue from property taxes -- a major funding source for local governments --thereby compromising cities’ ability to adequately fund services including police and fire protection.
During Tuesday’s public hearing in Social Circle, councilmembers learned from the city’s finance director, Toni Jo Howard, that if HB 581 had been in place in the city during the previous three years, the city would have lost $703,000 in revenue.
Also prior to their vote, Howard told the council that opting out of HB 581 would preserve local autonomy in setting tax rates.
During the public hearing, the council heard from two opponents of opting out of the floating homestead exemption.
John Miller, a Social Circle resident and business owner, pointed out that opting out would go directly against the wishes of voters in the city, a majority of whom favored the constitutional amendment on the November ballot.
Miller argued that, instead of working around the floating homestead exemption, city officials should exercise some budgetary restraint as a means of controlling property taxes in the city.
In a brief interview after the meeting, Miller said he was “disappointed that the city has not listened to the voters’ will on this issue.”
Also speaking out against opting out of House Bill 581 was city resident Gary House, who contended that opting out would give the city “a blanket” under which to adjust tax rates outside the limits of a floating homestead exemption.
The council made its vote to opt out with no comment from individual councilmembers.
Asked after the meeting if he had expected pushback from citizens on opting out of House Bill 581, Mayor David Keener said that he had not known at all what to expect from the public hearing.
Pursuant to the provisions of House Bill 581, the city of Social Circle, like all other local governments – county, municipal and school systems – must notify the Georgia Secretary of State’s office of its decision to opt out of the floating homestead exemption by March 1.
