Lee County stands alone without E-SPLOST. Here’s what that means for schools, taxpayers and the county’s future

LEESBURG — When Georgia voters went to the polls in May to decide whether to continue funding school construction through a one-cent education special-purpose local-option sales tax, or E-SPLOST, nearly every county either renewed an existing tax or continued collecting one already in place.

Lee County was the exception.

Following the defeat of its referendum, Lee County became just the second of Georgia’s 159 counties without voter approval of an active E-SPLOST, leaving the school system without the state’s primary local funding source for major construction, renovations, school buses and other capital improvements.

The only other recent county to reject an E-SPLOST referendum was Bryan County, where voters defeated the measure in 2025 amid public debate over an additional proposed $200 million general obligation bond that accompanied the tax referendum. Lee County’s referendum, by contrast, did not include a bond proposal.

For many residents, the vote raised an important question: What exactly is E-SPLOST, and why has it played such a central role in building Lee County’s schools for nearly 30 years?

The one-cent tax that built schools

The education-special-purpose local-option sales tax has financed much of the Lee County School System’s physical growth since the late 1990s. It has helped build new schools, expand existing campuses, replace aging roofs, purchase school buses, improve athletic facilities and modernize classrooms — all without paying a single teacher’s salary.

Yet despite its long history, E-SPLOST remains one of the least understood funding tools in Georgia education.

Unlike property taxes, which fund the day-to-day operation of schools, E-SPLOST is a voter-approved 1% sales tax dedicated exclusively to capital improvements. Georgia voters approved a constitutional amendment creating the program in 1996, and school districts began using it in 1997 to finance construction projects and retire building debt.

The tax may be collected for up to five years or until a voter-approved revenue cap is reached.

Under Georgia law, E-SPLOST proceeds can be used to purchase land, construct new schools, renovate existing facilities, replace roofs and heating and air conditioning systems, improve safety and security, purchase school buses and classroom technology, and retire debt associated with school construction.

What it cannot do is fund the everyday operation of schools.

Teacher salaries, employee benefits, utilities, instructional materials and routine operating expenses all come from a school district’s general operating budget, not E-SPLOST.

The distinction is intentional.

Large construction projects often require tens of millions of dollars up front. Before Georgia created E-SPLOST, school districts typically financed those projects through long-term bonds repaid primarily with property taxes. The 1-cent sales tax created another option, allowing communities to spread construction costs among everyone making taxable purchases in the county, including visitors, commuters and shoppers who do not own property there.

That approach is particularly significant in counties with relatively narrow commercial and industrial tax bases.

Property taxes depend on the value of local property. Sales taxes depend on consumer spending. Every taxable purchase at a grocery store, restaurant, retail shop or other business contributes to E-SPLOST collections, broadening the pool of taxpayers beyond homeowners.

Research by Georgia State University found E-SPLOST has become one of Georgia’s primary sources of local school construction funding, accounting for as much as 80% of capital funding in many school districts.

What voters approved

Lee County’s growth over the past three decades is reflected in the schools voters chose to build. The district’s earliest E-SPLOST programs helped finance Lee County Middle School West as enrollment accelerated during the late 1990s.

Subsequent referendums funded many of the facilities students use today.

E-SPLOST III authorized approximately $35 million for construction of Twin Oaks Elementary School, additions at Lee County High School, conversion of the former Twin Oaks campus into the Ninth Grade Campus, land acquisition and athletic improvements.

E-SPLOST IV authorized approximately $28.5 million for construction of Lee County Elementary School, expansion of Lee County High School’s lunchroom and media center, roof replacement at Kinchafoonee Primary School, parking improvements and work associated with converting another campus into a middle school.

Voters approved E-SPLOST V in 2016, authorizing up to $19.5 million for roof replacements, school buses, classroom technology, security improvements, Lee County High School renovations, athletic improvements and retirement of construction debt.

Four years later, voters approved E-SPLOST VI, authorizing up to $25 million for renovations at Lee County Primary School, construction of a new Lee County High School gymnasium, roadway and parking improvements, athletic facilities, a new bus loop at the Ninth Grade Campus, improvements at Twin Oaks Elementary, buses, technology, security equipment and continued debt retirement.

State compliance audits have consistently concluded the Lee County School System spent E-SPLOST proceeds in accordance with voter-approved resolutions and Georgia law. The most recent audit found no exceptions and reported the district remained in compliance with all applicable spending requirements.

When expectations fell short

Although E-SPLOST has funded many of Lee County’s largest school projects, it has not always generated the revenue originally projected. Financial records show E-SPLOST III significantly underperformed its early estimates.

District planners projected taxable sales throughout the county would grow approximately 18% annually, producing roughly $35 million over the life of the referendum. Instead, taxable sales grew by only about one-half of 1% annually.

Rather than collecting the anticipated $35 million, audited financial statements show the district ultimately spent approximately $20.7 million under E-SPLOST III. The shortfall forced school leaders to postpone several planned projects until approval of the next special tax.

The experience highlighted one of E-SPLOST’s greatest strengths, and one of its greatest risks.

Unlike property taxes, which generally produce relatively stable revenue, sales tax collections rise and fall with the local economy. During periods of slower retail spending or economic downturns, collections can lag behind projections, delaying projects or requiring districts to reprioritize capital plans.

Can E-SPLOST reduce property taxes?

One question often raised by taxpayers is whether the special tax can lower property taxes.

Georgia law requires E-SPLOST revenue to be spent only on the capital projects approved by voters or to retire eligible construction debt. If collections exceed project costs after all approved obligations have been met, remaining proceeds may ultimately reduce the need for future property tax-supported debt.

However, public records reviewed by The Albany Herald found no indication Lee County has ever generated sufficient excess E-SPLOST revenue to provide direct property tax relief through that mechanism.

Instead, the district’s documented history includes at least one referendum that generated substantially less revenue than anticipated.

Who pays now?

Lee County’s 2026 E-SPLOST referendum came at an unusual time.

The vote followed months of heightened public scrutiny over local taxes after errors in the county’s 2025 property tax digest resulted in taxpayers being overcharged and taxing entities working through the refund process. Although the property tax controversy was separate from the proposed 1-cent sales tax, it unfolded against a backdrop of increased public attention to how local governments collect, spend and account for taxpayer dollars. District officials sought renewal of the education sales tax to replace the aging roof at Lee County Middle School, install a new heating and air conditioning system at Lee County High School, and address other major maintenance needs throughout the district.

Voters said no.

The result, however, did not eliminate the need for those projects.

Georgia building codes, accreditation requirements, and health and safety standards still require school districts to maintain facilities that are safe for students and staff. Roofs eventually wear out. Heating and air conditioning systems fail. Aging infrastructure must still be repaired or replaced regardless of whether a dedicated capital funding source exists.

Without an approved E-SPLOST, those costs must now compete with other available revenue sources, be financed through borrowing, paid from reserve funds or ultimately supported by local property taxes.

The challenge ahead

Like most public school systems, Lee County spends the overwhelming majority of its operating budget on people.

Nationally, approximately 80% of public school operating expenditures are devoted to salaries and employee benefits, and Georgia school systems follow a similar pattern. Teachers, paraprofessionals, bus drivers, custodians, school nutrition workers, administrators and support staff are all paid from the district’s operating budget, not E-SPLOST.

According to the state, that financial structure is one of the reasons Georgia created the special education tax nearly three decades ago. By separating long-term construction costs from day-to-day operating expenses, school districts could replace roofs, renovate aging buildings and construct new schools without diverting as much operating revenue away from classrooms.

The failure of Lee County’s referendum does not change the district’s legal responsibility to maintain safe, functional schools.

It does, however, change how those projects may have to be financed.

Future school boards may be forced to delay capital improvements, rely more heavily on borrowing, seek voter approval through another referendum or devote a larger share of local revenues to facilities, resources that otherwise could support instructional priorities.

The buildings serving today’s students will continue to age whether a dedicated capital funding source exists or not.

For Lee County, the question is no longer whether those investments will be needed. It is how — and when — the community chooses to pay for them.