At two public hearings Thursday, Feb. 13, the Tallulah Falls Town Council entertained the notion of opting out of a property tax relief bill approved by voters in November, though the town’s mayor indicated no official decision has been made.
HB 581, a statewide floating homestead exemption that caps the annual increases in property values as a form of tax relief, can only proceed to a 1 cent sales tax (FLOST) if all cities and the county agree on the measure. FLOST would have to be approved by voters by referendum at a later time.
A decision to opt-out by Tallulah Falls could in effect compromise the future of both HB 581 and FLOST for Habersham and Rabun, since the town is located in both counties.
“A lot of people showing up at the board of education and public hearings, they’re saying, ‘Well, we voted for it – you need to (opt-in)’,” Mayor Mike Early said during the first hearing. “The problem is that the same item they voted for on the ballot said, ‘Should the constitution be amended to provide for a statewide home exemption’ – also says…a municipality or local school system may opt-out … (Voters) didn’t read that far.”
Early went on to say that if Tallulah Falls were to opt-in, officials would be “taking a gamble.”
“That gamble is – if a large majority of the people in town decide to homestead their property – it won’t happen immediately, but if 10 years from now, as home values may increase at a different rate than the Consumer Price Index, there’s a chance we could come up short in revenue because of those homesteaded properties.”
He added: “Is the council willing to take the chance that we will get a FLOST, (and) that (voters) in both counties (Habersham and Rabun) will agree to a FLOST every time it comes up? And will voters be willing to recognize and be aware that, if we don’t have a FLOST, we will have to increase our millage rate to make up that difference.”
By opting out, Tallulah Falls could be the sole holdout that kills the bill, as Habersham’s six other cities and the county have indicated plans to opt in. According to the legislation, each county and its municipalities must be unanimous in adopting the homestead exemption to be eligible to vote on FLOST.
Early said during the second public hearing Thursday that officials have not yet decided whether the town will officially move to opt in or out.
“This council has not made an official decision,” he said.
