Brookhaven Cut to DeKalb’s Higher Property Taxes

January 29, 2012

On the heels of DeKalb County’s 2011 property tax hike, the millage cap for the proposed City of Brookhaven will be set at 3.35 mills in the Brookhaven city charter as it moves forward in the 2012 session of the General Assembly. In addition, the homestead exemption for city property taxes will be increased from $10,000 to $20,000.

Remember that cityhood does not add property taxes to your tax bill. Instead, it shifts two of the existing county line items to the city, enabling us to keep those resources here at home. If you vote in favor of cityhood at the ballot box this July, it also will slash the rate at which these taxes are charged, cap that rate, and double the applicable homestead exemption.

The millage cap is a mechanism that prevents city property taxes from going higher than a certain rate without approval by the citizens in a public referendum. It is a benefit that does not exist in unincorporated DeKalb County.

What does this mean for you?

It guarantees virtually all homeowners a property tax cut, even if the city council sets the millage rate at the full 3.35 mills.

However, the need for the Brookhaven city council to use the full 3.35 mills is doubtful. Property taxes are likely to be lower than 3.35 mills. In its feasibility study for the proposed city, the Carl Vinson Institute of Government at the University of Georgia (CVI) estimated that expenditures would be $25.1 million. The City of Dunwoody, a similarly situated city in terms of population and geography, anticipates 2012 expenditures of $20.9 million. The new millage cap will reduce the CVI estimated surplus for Brookhaven from $3.4 million to approximately $261,348. Based upon Dunwoody’s actual expenditures, this estimated surplus is in excess of an already generous expenditure estimate.

The $261,348 surplus is on par with the CVI estimated surplus for Dunwoody when it became a city. In the Dunwoody feasibility study published in 2006, CVI projected a surplus of $278,789. In 2009, Dunwoody’s first year of operations, its actual expenditures were roughly $1.75 million less than that. This shows that CVI’s estimates are indeed conservative.

With a $20,000 homestead exemption, the City of Brookhaven would need to charge 3.22 mills to generate revenues equal to its estimated expenditures of $25.1 million. If expenditures are like those of Dunwoody, $20.9 million, then the necessary millage rate drops to 1.16 mills.

Here is a quantification of the real tax dollars associated with the property tax cut that the City of Brookhaven could provide:

A homeowner with a $100,000 assessed property value currently pays DeKalb County $273 for municipal services. That homeowner would pay $93 if Brookhaven’s expenditures equal Dunwoody’s $20.9 million, $258 if Brookhaven’s expenditures equal the CVI estimate of $25.1 million, and $268 if Brookhaven must use the full 3.35 millage cap.

A homeowner with a $200,000 assessed value currently pays DeKalb $610. That homeowner would pay $209 if Brookhaven’s expenditures equal Dunwoody, $580 if Brookhaven’s expenditures equal the CVI estimate, and $603 if Brookhaven must use the full millage cap.

A homeowner with a $300,000 assessed value currently pays DeKalb $946. That homeowner would pay $325 if Brookhaven’s expenditures equal Dunwoody, $902 if Brookhaven’s expenditures equal the CVI estimate, and $938 if Brookhaven must use the full millage cap.

A homeowner with a $400,000 assessed value currently pays DeKalb $1,283. That homeowner would pay $441 if Brookhaven’s expenditures equal Dunwoody, $1,224 if Brookhaven’s expenditures equal the CVI estimate, and $1,273 if Brookhaven must use the full millage cap.

The 3.35 mill cap would lower Brookhaven’s property taxes to a rate less than the 3.5 mills that existed before DeKalb County increased this rate in 2011 to 6.39 mills.

I look forward to working with citizens to bring Brookhaven a more responsive local government that guarantees lower property taxes and lives within its means.


Property Tax Cut for Brookhaven Homeowners

January 16, 2012

On the heels of DeKalb County’s 2011 property tax hike, the millage cap for the proposed City of Brookhaven will be set at 3.4 mills in the Brookhaven city charter as it moves forward in the 2012 session of the General Assembly. In addition, the homestead exemption for city property taxes will be increased from $10,000 to $20,000.

Remember that cityhood does not add property taxes to your tax bill. Instead, it shifts two of the existing county line items to the city, enabling us to keep those resources here at home. If you vote in favor of cityhood at the ballot box this July, it also will slash the rate at which these taxes are charged, cap that rate, and double the applicable homestead exemption.

The millage cap is a mechanism that prevents city property taxes from going higher than a certain rate without approval by the citizens in a public referendum. It is a benefit that does not exist in unincorporated DeKalb County.

What does this mean for you?

It guarantees virtually all homeowners a property tax cut, even if the city council sets the millage rate at the full 3.4 mills.

However, the need for the Brookhaven city council to use the full 3.4 mills is doubtful. Property taxes are likely to be lower than 3.4 mills. The Carl Vinson Institute of Government at the University of Georgia estimated that city expenditures would be $25.1 million. The City of Dunwoody, a similarly situated city in terms of population and geography, anticipates 2012 expenditures of $20.9 million. The new millage cap will reduce the Carl Vinson Institute’s estimated surplus for Brookhaven from $3.4 million to approximately $362,878. Based upon Dunwoody’s actual expenditures, this estimated surplus is in excess of an already generous expenditure estimate.

With a $20,000 homestead exemption, the City of Brookhaven would need to charge 3.22 mills to generate revenues equal to its estimated expenditures of $25.1 million.

The 3.4 mill cap would lower Brookhaven’s property taxes to a rate less than the 3.5 mills that existed before DeKalb County increased this rate in 2011 to 6.39 mills.

I look forward to working with citizens to bring Brookhaven a more responsive local government that guarantees lower property taxes and lives within its means.


Brookhaven’s Millage Cap and Homestead Exemption

January 6, 2012

The millage cap for the proposed City of Brookhaven will be set at 3.4 mills in HB 636, the Brookhaven city charter, as it moves forward in the 2012 session of the General Assembly.  In addition, the homestead exemption for city property taxes will be increased from $10,000 to $20,000. The legislative session begins this Monday, January 9.

The millage cap is a mechanism that prevents city property taxes from going higher than a certain rate without approval by the citizens in a public referendum.  It is a benefit that does not exist in unincorporated DeKalb County.

This guarantees virtually all homeowners a property tax cut, even if the city council sets the millage rate at the full 3.4 mills.

However, the need for the Brookhaven city council to use the full 3.4 mills is doubtful.  Property taxes are likely to be lower than 3.4 mills.  The Carl Vinson Institute of Government estimated that city expenditures would be $25.1 million.  The City of Dunwoody, a similarly situated city in terms of population and geography, anticipates 2012 expenditures of $20.9 million.  The new millage cap will reduce the Carl Vinson Institute’s estimated surplus for Brookhaven from $3.4 million to approximately $362,878.  Based upon Dunwoody’s actual expenditures, this estimated surplus is in excess of an already generous expenditure estimate.

With a $20,000 homestead exemption, the City of Brookhaven would need to charge 3.22 mills to generate revenues equal to its estimated expenditures of $25.1 million.

The 3.4 mill cap would lower Brookhaven’s property taxes to a rate less than the 3.5 mills that existed before DeKalb County increased this rate in 2011 to 6.39 mills.

I look forward to working with citizens to bring Brookhaven a more responsive local government that guarantees lower property taxes and lives within its means.


My Take on Tuesday’s E-SPLOST Vote

November 4, 2011

This is a friendly reminder that there is an election coming up on Tuesday, November 8. Your regular polling place will be open from 7:00 a.m. to 7:00 p.m. that day. There is one question on the ballot in unincorporated DeKalb as to whether or not you want to renew for a period of five years the E-SPLOST one-cent sales tax that goes to DeKalb school building projects.

Click here to see the sample ballot for the election. Click here and scroll down to review the list of projects that is proposed to be funded by the E-SPLOST if it is passed.

A few constituents have asked how I will be voting on the E-SPLOST. Despite the fact that there are ample reasons to be angry with the school system’s past management of school construction funds, I will be voting in favor of it.

If the E-SPLOST is not passed, homeowners will see an immediate increase in their property taxes because a homestead exemption will be revoked by operation of law. I prefer sales taxes to property taxes, particularly because everybody (not just homeowners) and a substantial number of people from outside DeKalb (think Perimeter Mall and the Brookhaven Costco) pays them. Furthermore, I view it as positive that part of the funding is allocated to the overdue new facility at Chamblee High School.

Some constituents have asked me whether the legislation that I helped to pass reducing the size of the school board from nine to seven members is tied to the E-SPLOST vote. While this is technically true, I do not view it as a reason to vote for or against the E-SPLOST. I am certain the General Assembly will take whatever steps are necessary in the 2012 legislative session to ensure that this important reform takes effect next year as planned.


How To Appeal Your Property Assessment

July 6, 2011

The deadline to appeal your property assessment is Monday, July 11. Here is an informative video on how to file an appeal. If you found this video helpful, please tell your neighbors. They might find it helpful, too.


About the Property Tax Assessment Freeze

November 1, 2010

My opponent has been sticking a flyer on mailboxes in our community that says: “Mike Jacobs says he’s a hero for helping to pass the Property Tax Assessment Freeze referendum that we must vote on Tuesday.”

I’m no hero, although my kids think I am. That’s good enough for me.

But I do want to make sure that you have correct and complete information about what the Property Tax Assessment Freeze is, how it works, and why it’s important that we renew it this year. The measure appears to have a small but dedicated band of opponents who are spreading misinformation about it.

The original Property Tax Assessment Freeze was passed during the 2006 session of the General Assembly, ratified overwhelmingly by DeKalb County voters in the 2006 election, and went into effect at the beginning of 2007. Unfortunately, because some of my colleagues in the DeKalb County legislative delegation insisted upon writing a five-year sunset into the legislation, the current assessment freeze will expire at the end of the 2011 tax year unless it is renewed.

That renewal is on your ballot this year. My opponent says the renewal is unnecessary because “[w]e already have a Property Tax Assessment Freeze in force for 2 more years.” This statement is factually incorrect and misrepresents why it’s important to renew the assessment freeze this year.

The Property Tax Assessment Freeze is only in effect for one more tax year, 2011, not for two years. More importantly, there isn’t another election scheduled in unincorporated DeKalb County between the 2010 election and the expiration of the current assessment freeze. This Tuesday, November 2, is our last opportunity to renew the assessment freeze before it expires.

If passed by voters on November 2, this renewal will remain in place for an additional five years until the end of 2016.

The assessment freeze applies only to the county government’s portion of your property tax bill, not the board of education’s portion. It also applies only to homesteads (your primary residence).

Does the Property Tax Assessment Freeze save you money? Absolutely! In most cases, it saves a homeowner hundreds of dollars. If you look at your most recent property tax bill, you should see an item in capital letters that says: “THE PROPERTY TAX FREEZE EXEMPTION SAVED YOU X DOLLARS.”

Below is part of my 2010 property tax bill. The item I just mentioned is highlighted. Using my bill as an example, the amount saved by the assessment freeze is $298.76.

If the Property Tax Assessment Freeze does not prevail on November 2, each homeowner will see this dollar amount (whatever the equivalent amount to my $298.76 is on your bill) added back into their property tax bill starting in 2012.

Two components govern the amount of money that you pay in property taxes to the county government: the millage rate and your property assessment. The millage rate is set by the DeKalb County Commission. In theory, the commissioners could reduce the millage rate to alleviate the impact of failing to pass the assessment freeze referendum this Tuesday. But you and I know that won’t happen.

Another important benefit of the Property Tax Assessment Freeze is that it eliminates backdoor property tax hikes. Rather than raising your property taxes by artificially increasing the assessed value of your home – something the county continues to do even as home values slide downward – the assessment freeze forces the county commission to vote to increase the millage rate openly and publicly if they want to raise your property taxes.

Simply put, the assessment freeze makes your elected county commissioners accountable for raising your property taxes, rather than letting an unaccountable tax assessor handle the dirty work of raising your property taxes.

In technical terms, the Property Tax Assessment Freeze is known as a “floating homestead exemption” because it causes your homestead exemption to increase by an amount equal to any increase in the assessed value of your home, thus erasing the increase in your property assessment. That means it does not prevent the assessed value of your home from being reduced if the fair market value goes down. The “freeze” only serves as a ceiling on the assessed value of your home, not a floor.

The Property Tax Assessment Freeze is a real mechanism that saves you money and holds your property taxes in check. The five-year renewal of the assessment freeze is titled “DeKalb County Homestead Referendum” on your ballot and is the very last item. I hope you will join me in supporting it.


DeKalb Taxpayers Beat GM Tax Hike

September 7, 2010

Thank you to everyone who answered the call in this message by taking the time to contact the county commissioners about the proposal to use our tax dollars as financial assistance to help an out-of-state developer to acquire and redevelop the Doraville GM site.

County officials confirmed that the proposal would have required a flat-out increase in your property taxes. Fortunately, the DeKalb County Commission had the good sense to defeat the proposal on a 5-2 vote. The five commissioners who voted against it wisely refused to raise your property taxes and use the proceeds of the tax hike to gamble on a risky commercial real estate venture.

Click here if you’d like to read my AJC op-ed piece that was published on the day of the vote. It’s the “con” article below the “pro” article.

Real estate experts agree that the GM site will be redeveloped once market conditions improve. The site is a prime parcel located on a major highway (I-285), a major north-south artery (Peachtree Industrial Boulevard), a MARTA station, and a freight railroad line. The county commission’s vote is by no means the end of the road for the property. It does, however, make it unlikely that we’ll see another effort to force DeKalb taxpayers to shoulder the risks of a large-scale project that banks and private investors will not finance.


Contact County Commissioners About GM Plan

August 23, 2010

Click here for telephone numbers and e-mail addresses to contact the DeKalb County commissioners about the GM redevelopment plan. Please see below to read my recent article on the subject.


Taxpayers Shouldn’t Become Developer’s ATM

August 20, 2010

Drive north on Peachtree Road and Peachtree Industrial Boulevard through Brookhaven, Chamblee, Doraville and into Dunwoody and the view is startling. Shopping centers are empty like the ghost towns of the Wild West.

Town Brookhaven is finally sprouting major anchor stores, but is having trouble filling its smaller retail store fronts. Chamblee Plaza? Nearly empty. The new “Super H Mart” center adjacent to the GM site? It’s nearly empty, too.

The CoStar Group, a national real estate analysis firm, says the vacancy rates of retail, shopping centers and offices in North DeKalb are at catastrophic levels when you compare them to the national average. With so many empty store fronts, why would county officials push so hard to use our tax dollars for a supersized mixed-use project at the site of the former GM plant in Doraville?

Consider this:

- In the North DeKalb zip codes 30319, 30338, 30340, 30341, 30346 and 30360, the vacancy rate for shopping centers is 23 percent compared to 14 percent in DeKalb County as a whole and 10 percent in the City of Atlanta.

- The vacancy rate for North DeKalb office buildings is 24 percent compared to 18 percent in the county overall and 20 percent in the City of Atlanta.

- Retail vacancy rates are 17 percent in those zip codes, 11 percent in DeKalb overall, and 9 percent in Atlanta, according to CoStar.

The county’s elected officials are considering using a special allocation of $36 million in federal stimulus bonds on the 165-acre GM site with visions of creating another Atlantic Station. These bonds come with a high price tag to the taxpayers. DeKalb officials would use the stimulus bonds as a $36 million “gift” to an out-of-state developer, New Broad Street of Florida.

Worse yet, county taxpayers would have to pay the principal and a majority of the interest on these bonds. It’s very likely that means higher property taxes for you and me because the county doesn’t otherwise have the money to make the payments.

In ordinary times, the developer wouldn’t have to rely on county taxpayers. There would be more private investment to help finance the project. But these are no ordinary times. We’re in the midst of the worst commercial real estate market in memory. Private investors don’t want to provide the financing for an overly ambitious mixed-use project consisting of shopping, apartments and offices. The county wants the taxpayers to step in and do what private investors won’t do: bear the risks of this project.

If a new restaurant, retail shop or gas station, for example, wants to open for business, investors take the risk whether it prospers or fails. The same should be true for this project. DeKalb taxpayers are not a bank. They are not in the business of providing corporate welfare to jump start a project the private sector would never finance.

This is the most ambitious project we’ve ever seen county officials attempt to tackle, and it comes during a deep recession. It is not the taxpayers’ job to finance the next Atlantic Station and add to the already glutted market a new supply of retail and commercial space.

The definition of insanity, according to Albert Einstein, is doing the same thing over and over and expecting different results. We should heed the lessons of the “real estate bubble” and steer clear of risking taxpayer funds for further overdevelopment. After the bubble has burst, don’t use our tax dollars to create another bubble!

There are two final things to consider:

1. The GM site ultimately will be redeveloped if the county does not intervene. It’s arguably the most valuable parcel of available commercial property in the county. It’s on a major highway (I-285), a major north-south artery (Peachtree Industrial), and a MARTA station. In better economic times, something that private investors and market forces will support will be built there. I’m confident of that.

2. These particular stimulus bonds are supposed to be used for public infrastructure projects, not for private development. When used properly, they are a cheaper way of financing these projects. The county already has a list of infrastructure needs a mile long, not the least of which is the water and sewer system upgrades that they plan to fund with massive increases in our water bills. The bonds could be used to defray those costs. They also could be used for projects such as street repairs, new sidewalks, intersection upgrades, and parks.

The DeKalb County Board of Commissioners will vote on this matter next Tuesday, August 24.

Commissioner Elaine Boyer has pledged to vote against it. I encourage you to contact the other six county commissioners (Rader, Johnson, Barnes-Sutton, May, Gannon, and Stokes) and urge them to vote “no” as well. In particular, Commissioner Jeff Rader appears not to have taken a position as of yet. You can find the commissioners’ telephone numbers and e-mail addresses by clicking here.


GM Redevelopment Plan? Taxpayers Beware.

June 21, 2010

When a county commissioner talks about spreading “risk” and “cost,” taxpayers should run in the other direction.

Those words were quoted from a recent edition of the DeKalb Neighbor (click for link) in which Commissioner Jeff Rader talked about the potential redevelopment of the Doraville GM plant: “We … need to spread risk and cost of this to other stakeholders. [Otherwise] the county will have to service the debt and use taxpayer funds to pay back that money.”

The GM redevelopment is a project that taxpayers need to be watching closely. Very closely.

New Broad Street, the developer of Florida’s Celebration community (click for link), is proposing a partnership with DeKalb County where the developer and the county will acquire the GM site and build a supersized mixed-use center with condos, apartments, retail stores, office space, and hotels. The county is proposing to use a special allocation of federal stimulus bonds known as recovery zone bonds to help finance the redevelopment of the GM site. The “benefit” of using these bonds is that the federal government subsidizes 45 percent of the interest.

However, the remaining principal and interest on the bonds would have to be paid out of the county treasury. That’s our tax dollars the county is gambling with. Whenever you read news stories that the county is thinking about shutting down recreation facilities and judges are reading the Riot Act to the CEO and county commissioners about the judicial budget (click for links), you have to wonder what the county is thinking when they consider using the very same tax dollars for risky development projects.

Some officials in the county government are going so far as to talk about increasing our property taxes to help pay for the bonds to redevelop the GM site. That should be a complete non-starter.

When Commissioner Rader was talking about spreading “risk” and “cost,” he was talking about the county’s efforts to shake down the Doraville City Council to use the city’s funds to help pay for the project, because the GM plant is located inside the City of Doraville. That’s still using tax dollars. It’s robbing from Peter to pay Paul. Doraville would be right to say no.

The DeKalb County Development Authority would be responsible for issuing the bonds to help pay for the New Broad Street project. Generally speaking, in DeKalb County, the use of our tax dollars to support the projects of a quasi-governmental authority requires a voter referendum. This referendum requirement is the result of a law I authored in 2007. As part of this year’s House Bill 203 (click for link), however, the General Assembly granted the county a one-time exemption for the stimulus bonds now being proposed for the GM site.

The reason for the exemption is that the stimulus bonds had a June 30th “use them or lose them” deadline. It would have been impossible to hold a referendum under this time constraint. The consequence of not meeting the deadline would be that DeKalb’s allocation of stimulus bonds would be reallocated to other local governments in Georgia. Those local governments would then be able to use the bonds for infrastructure projects like improvements to roads and sewers. Infrastructure is the real purpose of these particular stimulus bonds, not risky development projects. DeKalb either has obtained or is attempting to obtain an extension of the June 30th deadline.

Furthermore, I considered it an important safeguard that the county commission would have to conduct an open public vote on an intergovernmental agreement to spend our tax dollars to repay the stimulus bonds. This safeguard exists whether or not the referendum requirement applies to these bonds. The county commission has not yet voted on an intergovernmental agreement to use our tax dollars to repay stimulus bonds for the New Broad Street project at the GM site. In addition, the commission would have to vote to approve any property tax hike that is proposed for this purpose.

The commissioners absolutely should oppose such an agreement or tax increase. The county is in no position to bear the “risk” and “cost” of a supersized development project using our tax dollars. In a recent article in the Dunwoody Crier (click for link), Commissioner Elaine Boyer appeared to suggest that a majority of the county commission is prepared to reject a tax increase for the GM redevelopment plan.

To make sure this happens, your county commissioners need to hear directly from you. You can find their contact information at web.co.dekalb.ga.us/boc/contact.html if you would like to voice your opposition.


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