Georgia Commons

Senate · Passed · 2025-2026 Regular Session

SB44: SB44 Equalization Grants, Annual Calculations, and Allocation; the definition of the term "qualified local school system" by reducing the minimum required millage rate; revise

Last action May 14, 2025 · Effective Date 2025-07-01

Senate Bill 44 lowers the minimum local property tax rate school districts must levy to qualify for state equalization grants, from 14 mills to 10 mills, while cutting grants for districts that fall short.

In plain language

Georgia's equalization grant program (O.C.G.A. § 20-2-165) sends extra state money to local school systems that have a lower property tax base but tax residents at a certain minimum rate. Under prior law, a district had to levy at least 14 mills (a unit used to calculate property taxes) to count as a 'qualified local school system' eligible for these grants. This bill lowers that minimum to 10 mills, starting July 1, 2025. The bill also adds a penalty: if a district's equalization grant has already been calculated for the year but the district then cuts its tax rate below the 10 mill minimum, the state will claw back the grant to 75 percent of the original amount through a midterm adjustment. Finally, it requires the Department of Education to report each year, by September 1, on grant amounts, midterm adjustments, and any districts that received grants despite taxing below 10 mills, sending that report to legislative budget and education committees.

What the bill does

  • Lowers the minimum millage rate (a property tax rate measure) a local school system must levy to qualify for state equalization grants, from 14 mills to 10 mills, effective July 1, 2025.
  • Cuts a district's equalization grant to 75 percent of its original amount if the district lowers its tax rate below 10 mills after the grant was already calculated for the year.
  • Requires the Department of Education to issue an annual report on equalization grants, including any midterm reductions and districts that received grants while taxing below 10 mills.
  • Directs that this annual report go to House and Senate Appropriations Committees, House and Senate education committees, and state and legislative budget offices by September 1 each year.

Who it affects

Local school systems and school boards that receive or seek state equalization grants, especially lower property tax base districts near the millage threshold, along with the Department of Education, which must calculate grants and produce the new annual report, and state and legislative budget offices that receive it.

Why it matters

Districts that previously fell short of the 14 mill requirement may now qualify for state equalization funding at 10 mills, while districts that cut taxes below that new minimum after receiving a grant would see their funding reduced by 25 percent, affecting school budgets statewide.

Key provisions

  • Section 1 revises paragraph (9) of subsection (a) of O.C.G.A. § 20-2-165, lowering the millage rate threshold from 14 mills to 10 mills starting July 1, 2025.
  • Section 1 adds subsection (d.1), requiring a midterm reduction to 75 percent of the original equalization grant if a district's millage rate drops below 10 mills after the grant calculation.
  • Section 1 adds subsection (f), requiring the Department of Education to prepare an annual report on grant amounts, midterm adjustments, and ten year grant totals for each recipient system.
  • Subsection (f) requires the report to flag any system that got a grant while taxing below 10 mills, and to deliver it to House and Senate Appropriations, House and Senate education committees, and budget office directors by September 1.
  • Section 2 repeals conflicting laws.

From the bill

“beginning July 1, 2019, and thereafter,22 having a millage rate or an equivalent millage of at least 14 m ills July 1, 2025, and23 thereafter, having a millage rate or an equivalent millage rate of at least 10 mills.”

This shows the old 14 mill requirement being replaced with the new 10 mill minimum starting July 1, 2025.

“the total e qualization grant amount30 awarded to such local school system is reduced to an amount equ al to 75 percent of the31 initial equalization grant amount.”

This sets the 25 percent penalty for districts that cut taxes below the minimum after their grant is calculated.

Status timeline

  1. 2025-05-14Effective Date 2025-07-01
  2. 2025-05-14Act 280
  3. 2025-05-14Senate Date Signed by Governor (Senate)
  4. 2025-04-07Senate Sent to Governor (Senate)
  5. 2025-03-28House Passed/Adopted (House)
  6. 2025-03-28House Third Readers (House)
  7. 2025-03-18House Committee Favorably Reported (House)
  8. 2025-02-19House Second Readers (House)
Show full history (17 actions)
  1. 2025-02-18House First Readers (House)
  2. 2025-02-13Senate Passed/Adopted By Substitute (Senate)
  3. 2025-02-13Senate Third Read (Senate)
  4. 2025-02-11Senate Committee Favorably Reported By Substitute (Senate)
  5. 2025-02-10Senate Recommitted (Senate)
  6. 2025-02-06Senate Read Second Time (Senate)
  7. 2025-02-05Senate Committee Favorably Reported (Senate)
  8. 2025-01-29Senate Read and Referred (Senate)
  9. 2025-01-28Senate Hopper (Senate)

Sponsors

  • Sam Watson (R, SD-011)Primary sponsor
  • Russ Goodman (R, SD-008)
  • Carden Summers (R, SD-013)
  • Chuck Hufstetler (R, SD-052)
  • John Kennedy (R, SD-018)
  • Jason Anavitarte (R, SD-031)
  • Charles Cannon (R, HD-172)

Votes

  1. PassedSenate voteFebruary 13, 2025

    51 yea, 0 nay (0 not voting, 5 absent)

    Passage By Substitute: Senate Vote #51

  2. PassedHouse voteMarch 28, 2025

    138 yea, 23 nay (3 not voting, 16 absent)

    Passage: House Vote #336

Topics

  • school funding
  • property taxes
  • equalization grants
  • education policy
  • local school systems

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