--- title: HB 12. Education; grants; revise definition of qualified local school system collection: bills id: 2025-2026/hb12 cite_as: HB 12, 2025-2026 Regular Session (Ga.) canonical_url: https://georgiacommons.org/bills/2025-2026/hb12 md_url: https://georgiacommons.org/bills/2025-2026/hb12.md text_url: https://georgiacommons.org/bills/2025-2026/hb12/text source_url: https://www.legis.ga.gov/legislation/69292 date: 2025-04-04 status: introduced corpus_version: bills-2026-08-28 license: Public record of the Georgia General Assembly, via LegiScan; see about.md publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice. up: https://georgiacommons.org/bills/2025-2026.md previous: https://georgiacommons.org/bills/2025-2026/hb11.md next: https://georgiacommons.org/bills/2025-2026/hb13.md index: https://georgiacommons.org/bills/index.md omitted: votes and history omitted_chars: 249 omitted_url: https://georgiacommons.org/bills/2025-2026/hb12.md?full=1 bill_number: HB 12 session: 2025-2026 Regular Session session_slug: 2025-2026 chamber: House bill_type: bill status_date: 2025-01-13 last_action: House Withdrawn, Recommitted sponsors: - Charles Cannon - Chris Erwin - Rob Leverett - John Corbett - Trey Kelley - Jaclyn Ford text_version: Comm Sub has_text: true legiscan_url: https://legiscan.com/GA/bill/HB12/2025 upstream_id: 1916890 summaries_model: claude-sonnet-5 topic_tags: - school funding - property taxes - equalization grants - education policy - millage rates --- # HB 12. Education; grants; revise definition of qualified local school system ## Text 25 LC 49 9002S The House Committee on Education offers the following substitute to HB 12: A BILL TO BE ENTITLED AN ACT To amend Code Section 20-2-165 of the Official Code of Georgia Annotated, relating to1 equalization grants, annual calculations, and allocation, so as to revise the definition of the2 term "qualified local school system" by reducing the minimum re quired millage rate or3 effective millage rate from 14 mills to 10 mills; to provide fo r a 25 percent reduction of4 equalization grant awards for local school systems whose millage rate or equivalent millage5 rate does not meet the minimum requirement; to require annual reporting by the Department6 of Education; to repeal conflicting laws; and for other purposes.7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:8 SECTION 1.9 Code Section 20-2-165 of the Official Code of Georgia Annotated, relating to equalization10 grants, annual calculations, and allocation, is amended by revi sing paragraph (9) of11 subsection (a) and adding two new subsections to read as follows:12 "(9) 'Qualified local school system' is defined as any local school system:13 (A) Having an assessed valuation per weighted full-time equivalent count for the year14 of the digest which is below the guaranteed valuation;15 H. B. 12 (SUB) - 1 - 25 LC 49 9002S (B) Having an effective millage rate greater than the millage rate applied to calculate16 the local five mill share pursuant to subsection (a) of Code Section 20-2-164; and17 (C) Beginning July 1, 2015, having a millage rate or an equivalent millage of at least18 12 mills; beginning July 1, 2016, having a millage rate or an equivalent millage of at19 least 12 1/2 mills; beginning July 1, 2017, having a millage ra te or an equivalent20 millage of at least 13 mills; beginning July 1, 2018, having a millage rate or an21 equivalent millage of at least 13 1/2 mills; 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."24 "(d.1) If, after a local school system's equalization grant has been calculated for the25 ensuing fiscal year as provided for in subsection (b) of this Code section, such local school26 system decreases the actual or equivalent millage rate levied a gainst its digest for27 maintenance and operation to an amount below the minimum amount required in28 subparagraph (a)(9)(C) of this Code section, a midterm adjustme nt in such local school29 system's equalization grant shall be made such that 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."32 "(f) Each year, the Department of Education shall prepare a rep ort of each local school33 system that received an equalization grant the previous fiscal year. Such report shall34 include for each local school system the initial equalization g rant amount, the midterm35 adjustment to the equalization grant, and the total amount of equalization grants received36 in the previous ten years. Such report shall also identify eac h local school system that37 received an equalization grant during the previous fiscal year while having a millage rate38 or an equivalent millage rate of less than 10 mills for the per iod of time upon which the39 calculation of such equalization grant was based. Each year, no later than September 1, the40 Department of Education shall provide such report to the chairp ersons of the House41 Committee on Appropriations, the Senate Appropriations Committe e, the House42 H. B. 12 (SUB) - 2 - 25 LC 49 9002S Committee on Education, the Senate Education and Youth Committee, the director of the43 Office of Planning and Budget, the director of the Senate Budget and Evaluation Office,44 and the director of the House Budget and Research Office."45 SECTION 2.46 All laws and parts of laws in conflict with this Act are repealed.47 H. B. 12 (SUB) - 3 - ## Summaries written by Georgia Commons The following was written by claude-sonnet-5 from the text above and is not part of the bill. Quote the text, not the summary. A House committee substitute for HB 12 would lower the minimum property tax rate Georgia school districts must set to qualify for state equalization grants, from 14 mills to 10 mills, while cutting grants for districts that fall short. ### Plain-language summary Georgia's equalization grant program sends extra state money to school districts with low property values so they can raise enough revenue for schools. To qualify, a district currently must levy a minimum property tax rate (millage rate) of 14 mills. This bill lowers that minimum to 10 mills starting July 1, 2025, making it easier for districts with lower tax rates to qualify for the grants. The bill also adds a penalty: if a district's grant has already been calculated for the year but the district then cuts its tax rate below the 10-mill minimum, the state will reduce that district's total equalization grant to 75 percent of the original amount. It also requires the Department of Education to report annually, by September 1, to legislative budget committees on which districts received grants, any midterm reductions, and which districts fell below the 10-mill threshold. ### What it does - Lowers the minimum millage rate (local property tax rate) a school district must levy to be a 'qualified local school system' eligible for equalization grants, from 14 mills to 10 mills, effective July 1, 2025. - Cuts a district's total equalization grant to 75 percent of the original amount if the district later lowers its tax rate below the new 10-mill minimum after its grant was already calculated. - Requires the Department of Education to prepare an annual report on every district that received an equalization grant, including grant amounts, any midterm reductions, and ten-year grant totals. - Requires that report to flag any district that received a grant while taxing below the 10-mill minimum, and to send it to House and Senate budget and education committees and state budget offices by September 1 each year. ### Who it affects Local school districts across Georgia, especially those with lower property tax rates that currently fall short of the 14-mill threshold; school boards deciding tax rates; and the Department of Education, which must calculate grants, apply midterm reductions, and produce the new annual report. ### Why it matters Districts that tax below 14 mills but at least 10 mills would become newly eligible for state equalization funding, potentially increasing state aid to lower-tax districts. Districts that cut taxes after receiving a grant would lose 25 percent of that grant, creating a financial incentive to maintain tax rates. ### Key provisions - Section 1 revises O.C.G.A. ยง 20-2-165(a)(9) to change the millage rate threshold for a 'qualified local school system' from 14 mills to 10 mills, effective July 1, 2025. - Section 1 adds subsection (d.1), reducing a district's total equalization grant to 75 percent if the district's millage rate drops below 10 mills after the grant amount was already calculated for the year. - Section 1 adds subsection (f), requiring an annual Department of Education report on grant amounts, midterm adjustments, ten-year totals, and districts taxing below 10 mills, due to legislative committees by September 1. - Section 2 repeals conflicting laws. ## Status - Status: Introduced (2025-01-13) - Last action: House Withdrawn, Recommitted (2025-04-04) - Sponsors: Charles Cannon, Chris Erwin, Rob Leverett, John Corbett, Trey Kelley, Jaclyn Ford - Official page: https://www.legis.ga.gov/legislation/69292 > The history, votes, and amendments (249 characters) are at https://georgiacommons.org/bills/2025-2026/hb12.md?full=1