Habersham County leaders to discuss possible sales tax hike

Habersham County commissioners have been foreshadowing the possibility since February and now, they’re moving ahead with plans to pitch another penny on the dollar sales tax to voters. The county is seeking to raise $44 million over five years through a Transportation SPLOST. Before they can do that, they must first get buy-in from city leaders.

County officials will meet with representatives of Habersham’s seven municipalities on June 28 to discuss an intergovernmental agreement for T-SPLOST. If the cities agree, and voters approve, Habersham County’s sales tax would increase from 7 to 8 percent.

If the county does not get buy-in from the cities, the county likely will still forge ahead with its plan for a tax referendum, but at a lower rate.

(Hadley Cottingham/Now Habersham)

“If the qualified cities and the county enter an IGA, up to a full penny can be pursued. If not, the county can choose to seek up to three-quarters or .75 of a penny, in .05 percent increments,” explains Habersham County Manager Alicia Vaughn.

Either way, any increase in the local sales tax rate could prove a tough sell to voters. In the past seven months, Habersham County voters have approved two special local options sales tax initiatives. The first, passed in November, provides funding for public safety and other capital improvements. The second is the education SPLOST passed in May. While neither of these SPLOSTS altered the local sales tax rate – they replaced existing SPLOSTS that were expiring – the proposed T-SPLOST would. And the measure comes at a time when county residents are dealing with high inflation and a possible property tax hike.

What’s in it for taxpayers?

Offsetting property taxes is often used as a selling point to secure votes for sales tax increases, but in this case, it’s not clear that would happen. T-SPLOST funds would be used to augment revenue already on the books.

The county currently relies on revenue from SPLOST and state grants for road maintenance and construction, bridge maintenance, and stormwater infrastructure. The Local Maintenance and Improvement Grants, referred to as LMIG, are administered by the Georgia Department of Transportation.

According to Vaughn, the six-year SPLOST approved in November includes an estimated $9.7 million for roads and bridges which equates to about $1.6 million annually. LMIG contributes approximately $800,000 annually.

“The county has over 500 road miles and over 50 bridges to maintain with these limited funds. This funding is not adequate to properly address these needs,” she says.

T-SPLOST would provide a consistent source of revenue for the county to take care of its roads and bridges, Vaughn says. In addition, it “would also allow the county to reallocate the portion of SPLOST funds dedicated to Public Works to address other important needs in the county such as public safety.”

The exact projects to be included in the proposed referendum have not been decided; that’s part of the purpose of next Tuesday’s meeting. In 2018, voters defeated a T-SPLOST referendum partly over concerns about what was in it. Before that vote, critics questioned why the $35 million measure pitched as a ‘roads and bridges’ SPLOST included $2 million for the Habersham County Airport.

Proponents hope this time will be different.

If Habersham voters do approve T-SPLOST, they’ll join a growing trend across the state. In 2019, just over half of the counties in Georgia had local T-SPLOSTs. Now, roughly two-thirds of the state’s 159 counties have some form of T-SPLOST funding in place, Georgia Department of Revenue records show. Northeast Georgia counties with T-SPLOSTs include Banks, Clarke, Elbert, Madison, and Rabun. Franklin, Habersham, Hall, Hart, Jackson, Oconee, Stephens, Towns, Union, and White do not currently utilize T-SPLOST funding.

Habersham’s joint county/city meeting to discuss the proposed referendum is scheduled for 6 p.m. on Tuesday, June 28. It will be held in the community room at Habersham EMC’s Clarkesville headquarters located at 6135 Highway 115. The meeting is open to the public. Those unable to attend may view a livestream of the meeting on Habersham County’s website www.habershamga.com.

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