HR1114: HR1114 Homeowner's Incentive Adjustment clause; remove cap on benefits - CA

LC 33 9898S The House Committee on Rules offers the following substitute to HR 1114: A RESOLUTION Proposing an amendment to the Constitution so as to revise proc edures for financing1 counties, municipalities, consolidated governments, and school systems to provide property2 tax relief for homeowners; to provide for the gradual reduction in the assessed value of3 homestead properties for tax purposes; to provide for an additi onal disabled veterans'4 homestead exemption; to remove the cap on benefits granted pursuant to the Homeowner's5 Incentive Adjustment clause; to authorize the General Assembly to provide for local grant6 and adjustment programs; to authorize the dedication of funds for state and local grants; to7 revise provisions for sales and use taxes that may be levied by local boards of education for8 capital outlay projects; to provide a cap on the taxes that may be levied by local boards of9 education; to authorize the conversion of sales and use and exc ise taxes for educational10 purposes authorized by certain local constitutional amendments into sales and use taxes11 authorized by general provisions of law; to provide for a new local homestead option sales12 tax that may be enacted by counties, consolidated governments, municipalities, and local13 school systems; to provide for related matters; to provide for the submission of this14 amendment for ratification or rejection; and for other purposes.15 BE IT RESOLVED BY THE GENERAL ASSEMBLY OF GEORGIA:16 - 1 - LC 33 9898S SECTION 1.17 Article VII, Section I, Paragraph III of the Constitution is amended by revising subparagraph18 (a) and adding a new subparagraph to read as follows:19 "(a) All taxes shall be levied and collected under general laws and for public purposes20 only. Except as otherwise provided in subparagraphs (b), (c), (d), (e), (f), and (h), and (i)21 of this Paragraph, all taxation shall be uniform upon the same class of subjects within the22 territorial limits of the authority levying the tax."23 "(i) Tangible real property which is subject to a homestead exemption granted pursuant24 to Section II of this article shall be assessed for ad valorem taxation purposes at a reduced25 value than other tangible real property with such reduced assessment level being achieved26 by the gradual reduction of the assessed value of such properti es from 40 percent of27 appraised value to 10 percent of appraised value by 3 percent i ncrements each year28 beginning in tax year 2027; provided, however, that local gover nments and local school29 systems shall have the local option to accelerate the reduction provided for in this30 subparagraph. For local governments that calculate assessed va lue of properties at a31 percentage other than 40 percent of appraised value, such local government shall,32 beginning in tax year 2027, reduce such local government's percentage of appraised value33 by a total of 75 percent over 10 years in equal increments each year beginning in tax year34 2027. The General Assembly by general law may further provide f or implementation of35 this subparagraph."36 SECTION 2.37 Article VII, Section II of the Constitution is amended by adding a new Paragraph to read as38 follows:39 "Paragraph VI. Additional disabled veterans' homestead exemption . The General40 Assembly shall provide by general law for the creation of an ad ditional 100 percent41 disabled veterans' homestead exemption for the full assessed value of a homestead upon42 - 2 - LC 33 9898S a 100 percent disabled veteran procuring a loan or otherwise financing the development of43 new residential construction, obtaining or receiving a residential structure by inheritance,44 or purchasing an existing residential structure, for the purpos e o f u s e a s a p r i m a r y45 residence."46 SECTION 3.47 Article VII, Section IIA of the Constitution is amended by revising Paragraph I as follows:48 "Paragraph I. State and local grants; adjustment amount. (a) For each taxable year, a49 homeowner's incentive adjustment may be applied to the return of each taxpayer claiming50 such state-wide homestead exemption as may be specified by gene ral law. The General51 Assembly by general law may authorize local governments and loc al school systems to52 establish local grant programs and to appropriate local tax fun ds in support of local53 homeowner's incentive adjustments. The amount of such adjustment may provide a54 taxpayer with a benefit equivalent to a homestead exemption of up to $18,000.00 of the55 assessed value of a taxpayer's homestead or the taxpayer's ad valorem property tax liability56 on the homestead, whichever is lower . The General Assembly may appropriate such57 amount each year for grants to local governments and school districts as homeowner tax58 relief grants.59 (b) For each taxable year in which homestead properties locate d in a county,60 consolidated government, municipality, or local school system are assessed at a reduced61 value for purposes of ad valorem taxation pursuant to Article V II, Section I, Paragraph62 III(i), the General Assembly may appropriate grants to such local governments and school63 systems for purposes of replacing lost revenue due to such reduced assessment level.64 (c) Notwithstanding any other provisions of this Constitution, the General Assembly may65 provide by law for the dedication of the proceeds of specific t axes, fees, or assessments,66 including, but not limited to, dedicated proceeds from sales ta x collections on67 high-technology data centers, to fund the grants provided for in this Paragraph.68 - 3 - LC 33 9898S (d) The adjustments and grants authorized by this Paragraph shall be made in such69 manner and shall be subject to the procedures and conditions as may be specified by70 general law heretofore or hereafter enacted."71 SECTION 4.72 Article VIII, Section VI, Paragraph IV of the Constitution is a mended by revising73 subparagraphs (a) and (e) and adding new subparagraphs to read as follows:74 "(a) The board of education of each school district in a county in which no independent75 or area school district is lo cated may by resolution, and the board of education of each76 county school district and the board of education of each , independent, and area school77 district located wholly or partially within the same county as such county school district78 may by concurrent resolutions, impose, levy, and collect a sales and use tax for educational79 purposes of such school districts conditioned upon approval by a majority of the qualified80 voters residing within the limits of the local taxing jurisdict ion voting in a referendum81 thereon. In addition, when a county school district has one or more independent or area82 school districts located wholly or partially within the same county as such county school83 district, the school district or combination of school districts that h as a majority of the84 students enrolled within the county, based on the latest full-time equivalent count, shall be85 authorized to call for a referendum to impose, levy, and collec t a sales and use tax for86 educational purposes of such school districts conditioned upon approval by a majority of87 the qualified voters residing within the limits of the county voting in a referendum thereon. 88 This tax shall be at the a rate of not to exceed 1 percent and shall be imposed for a period89 of time not to exceed five years, but in all other respects, except as otherwise provided in90 this Paragraph, shall correspond to and be levied in the same manner as the tax provided91 for by Article 3 of Chapter 8 of Title 48 of the Official Code of Georgia Annotated, relating92 to the special county 1 percent sales and use tax, as now or he reafter amended. 93 Proceedings for the reimposition of such tax shall be in the same manner as proceedings94 - 4 - LC 33 9898S for the initial imposition of the tax, but the newly authorized tax shall not be imposed until95 the expiration of the tax then in effect."96 "(e) Except as provided for in subparagraph (k) of this Paragraph, the The tax imposed97 pursuant to this Paragraph shall not be subject to and shall no t count with respect to any98 general law limitation regarding the maximum amount of local sales and use taxes which99 may be levied in any jurisdiction in this state."100 "(k) Notwithstanding any other provision of this Constitution, the total of the rates of the101 sales and use tax levied pursuant to this Paragraph and the sal es tax for educational102 purposes levied pursuant to Article IX, Section IV, Paragraph V shall not exceed 2 percent.103 (l) Notwithstanding Article XI, Section I, Paragraph IV, any sales and use or any excise104 tax for educational purposes levied pursuant to any constitutio nal amendment continued105 in force and effect pursuant to Article XI, Section I, Paragrap h IV(a) that is in force and106 effect on January 1, 2028, may be converted into a sales and use tax authorized pursuant107 to Article IX, Section IV, Paragraph V, and, if so, shall hence forth be governed by the108 provisions of such Paragraph V and any laws enacted pursuant th ereto. All such local109 constitutional amendments converted into a sales and use tax authorized pursuant to Article110 IX, Section IV, Paragraph V shall stand repealed by operation of law and shall be deleted111 as part of this Constitution upon such conversion."112 SECTION 5.113 Article IX, Section IV of the Constitution is amended by adding a new Paragraph to read as114 follows:115 "Paragraph V. Local homestead option sales tax . (a) The General Assembly shall116 provide by general law for a local homestead option sales tax that may be enacted by any117 county, consolidated government, municipality, or local school system to offset the loss of118 revenue received from homestead property taxes by such counties , consolidated119 governments, municipalities, and local school systems due to an y reduction of assessed120 - 5 - LC 33 9898S value on homestead property pursuant to Article VII, Section I, Paragraph III(i) or due to121 any increased homestead exemptions. To effectuate such offsets, such general law shall122 provide for the:123 (1) Optional imposition of a local homestead option sales tax in support of the local124 school system at a rate not to exceed 2 percent;125 (2) Optional imposition of a local homestead option sales tax in support of a county,126 consolidated government, or municipality at a rate not to exceed 1 percent. Such general127 law shall provide for proportional distribution of proceeds bet ween such local128 governments based on amount of such loss of revenue for each af fected local129 government;130 (3) Exemption of homestead properties located in a county, consolidated government,131 municipality, or local school system from certain ad valorem ta xes or reduction in the132 percentage of assessed value for purposes of ad valorem taxes o n such homestead133 property pursuant to Article VII, Section I, Paragraph III(i), if the county, municipality,134 consolidated government, or local school system enacts a local homestead option sales135 tax authorized by this Paragraph; and136 (4) Offsetting or exemption of county, consolidated government, municipal, or local137 school system ad valorem taxes for other properties in a manner provided by general law.138 (b) The provisions of Article VII, Section II, Paragraph II(a) shall not apply to any laws139 enacted pursuant to this Paragraph nor, except as provided in this subparagraph, shall any140 local homestead option sales tax imposition be conditioned upon or require the approval141 of a majority of the qualified electors residing within the lim its of the local taxing142 jurisdiction voting in a referendum thereon; provided, however, that the General Assembly143 may by general law provide that the implementation or renewal of a local homestead option144 sales tax after January 1, 2037, may be conditioned upon approv al by a majority of the145 qualified electors residing within the limits of the local taxi ng jurisdiction voting in a146 referendum thereon; and provided further, however, that, in the event that such a147 - 6 - LC 33 9898S referendum fails, the value at which homestead property is assessed for such jurisdiction148 shall be increased to 40 percent of the appraised value of the homestead property for such149 jurisdiction."150 SECTION 6.151 The above proposed amendment to the Constitution shall be publi shed and submitted as152 provided in Article X, Section I, Paragraph II of the Constitution. The ballot submitting the153 above proposed amendment shall have written or printed thereon the following:154 "( ) YES155 ( ) NO 156 157 158 159 160 Shall the Constitution of Georgia be amended to provide property tax relief for homeowners by reducing the percent of taxable assessed valu e of residential properties from 40 percent of appraised value to 10 percent of appraised value at the rate of 3 percent each year over 10 year s, adding an additional disabled veterans' homestead exemption, and authoriz ing local homestead option sales taxes to offset lost ad valorem revenues?" All persons desiring to vote in favor of ratifying the proposed amendment shall vote "Yes." 161 All persons desiring to vote against ratifying the proposed amendment shall vote "No." If162 such amendment shall be ratified as provided in said Paragraph of the Constitution, it shall163 become a part of the Constitution of this state.164 - 7 -