CHAD WARBINGTON: Upcoming FLOST referendum part of May 19 vote

ALBANY-DOUGHERTY COUNTY VOTER ALERT: On May 19, Dougherty County voters will have a referendum to decide if we should raise our sales tax from 8% to 9% and use that additional 1% of sales tax revenue to lower our property taxes.

If passed, the additional 1% sales tax would be levied for five years, at such time it would have to be renewed via another referendum.

The current 8% sales tax includes 4% to the state, 1% LOST (which is used for property tax roll back), 1% SPLOST, 1% T-SPLOST, and 1% E-SPLOST.

FLOST stands for floating local-option sales tax. By law, all funds collected through an additional 1% FLOST must be used only to reduce property taxes, not for additional city or county spending. A FLOST shifts part of the tax burden to operate both city and county governments from property owners to everyone who shops and purchases goods in Dougherty County, including visitors and residents of surrounding counties.

Previous sales tax referendums approximate that 50% of sales tax in Dougherty County is generated from visitors or non-residents.

In 2024, the Georgia General Assembly passed HB581 that provides two different tools for local governments to lower the property tax burden on citizens. First it created a statewide floating homestead exemption that allows the assessed value of a home to increase annually only by the rate of inflation based on CPI (consumer price index). Counties and cities were allowed to either “opt in” or “opt out” of this proposal, and fortunately,

Dougherty County and the city of Albany “opted in.”

So if you own a home in Dougherty County, the assessed value of your home is based on your 2024 assessed value, and it can only increase by CPI (generally 3% would be average). This locked-in assessed value is critical for Dougherty County homeowners because the county just completed a countywide property value assessment for the first time in 17 years.

That’s not a misprint: 17 years. This is chasing a rabbit,, but one could say that 17 years without an assessment contributes to the reason Dougherty County has one of the highest millage rates in the state. Without keeping the value of all properties accurate, the only knob the county has to increase their funding is to raise the millage rate.

The city is much less dependent on property tax for funding of city services so the “high millage” rate is not so much of a factor with the city. To fix this problem, the new state law requires all parcels to be assessed every three years. Much different than 17 years. If you sell your home, the floating homestead exemption ends, and the buyer will be assessed the current value which probably will be significantly higher than the previous
homeowner.

The second tool of HB581 to lower the property tax burden of citizens is what was described at the beginning of this piece. It allows local governments to call for a referendum and ask citizens if they want to shift some of the property tax burden from
property owners to retail sales tax. This decision is for the voters of Dougherty County to decide on May 19.

When the city and county commissions voted last month to move forward with an IGA (inter-governmental agreement) to call for the referendum, you might have noticed that I voted “no”. My “no” vote was not against the referendum itself; it was against how the proceeds for the possible 1% sales tax was applied to property owners. The annual amount of a 1% sales tax is approximately $20 million for Albany and Dougherty County. We had to decide how to apply that $20 million annual sales tax to property owners across the city and county.

The IGA we voted on applies 68% to all county property owners, 24% to city property owners and 8% to property owners in the unincorporated areas (via Special Services District). The Special Services District is optional and is a preference decided by those in the Special Services District, not part of the charter of the city or the constitution of the county. Those services can be altered or dropped any time, and there are services that are duplicated by choice.

So I felt the Special Services District should not be included in the possible FLOST property tax rollback. The option that I supported was 75% to all county property owners and 25% to city property owners, which would give a city property owner the full 100% rollback of the FLOST sales tax.

As an elected city commissioner, my preference was toward helping city property owners. However, four votes carry the day, and we voted to subsidize the Special Services District with city property taxes. I could chase another rabbit called “consolidation,” but I’ll save that topic for another day.

Here are the potential property tax rollbacks created by a 1% FLOST sales tax on a property valued at $150,000 ($60,000 assessed value): 

— $402: County property tax reduction
— $168:City property tax reduction
— $192: Special Services District fee reduction

Benjamin Franklin said, “In this world nothing can be said to be certain, except death and taxes.” With the upcoming FLOST sales tax referendum, we just get to decide what type of tax.