After holding three hearings on the prospect of opting out of the House Bill 581 provisions, Liberty County Board of Education members are going to be opting in.
Board members voted 6-1 Tuesday night to stay in with HB 581, which offers a statewide floating homestead exemption. Board members previously worried about the loss of property tax revenue and cited a potential loss in property tax proceeds even when opting in.
“I’m all for opting in,” said board member Carol Guyett. “I am convinced we will make it work. We have always operated fiscally sound.”
Because of an initial intent to opt out of HB 581, the school board had to hold three public hearings and then file its decision to opt out with the state Secretary of State by March 1.
Liberty County already has in place the Kemp-Deloach- Williams Act in place, named for the late state Sen. Rene Kemp and state House Reps. Buddy Deloach and Al Williams. Under the KDW, homestead values cannot rise by more than 3% or the consumer price index, whichever is lower, until the property is sold.
HB 581 puts in place a cap on a home’s taxable value to no more than the rate of inflation the prior year. As school system chief financial officer Stephane Clark pointed out, HB 581 prevents rapid increases in the assessed value of homes but does not freeze the value.
KDW, which applies only to Liberty County property owners, was approved by Liberty County voters in 2004 and went into effect in 2005. For property owners, KDW is more beneficial than the HB 581 homestead exemptions, Clark said.
“Whether we opt in or out is probably not going to make one hill of beans, because we have KDW,” board chair Verdell Jones said.
Opting in to HB 581 also does not eliminate any existing homestead exemptions. It may override existing floating, base-year and frozen exemptions and in that case, the taxpayer will receive the exemption that is the most beneficial.
While cities and counties can implement a floating local option sales tax, or FLOST, to make up for lost revenue, but school systems cannot put in a FLOST.
Board member Marcus Scott, who voted to opt out, said most of the school system’s budget is tied to salaries for faculty and staff.
“If we opt in, we’re taking away from our budget and we’re taking away from things for our students,” he said. “Not knowing the effects on a future board, I would say it’s reckless.”
Residents who spoke at Tuesday’s public hearing questioned the school board’s spending and how effective the system is.
“I think it’s a spending problem,” said Glenn Burch. “In 2018, the budget was about $101 million. We’re now looking at getting north of $145 million. That’s just shy of a 45% increase. In that same roughly eight year period, the rate of inflation was about 26%.”
Burch also said that while household income has improved by about $15,000 over that time, taxes are outstripping those gains.
“If you look at performance at grade level, we’re in the bottom half of every category. But somehow we have a 90% graduation rate at the high schools,” he said. “In this county, we go up $5 million a year in spending and have those kinds of results. The two just don’t add up.”
“I don’t mind paying taxes,” Benjamin Banks said, “as long as I see a return.”
“We’ve spent more money,” said Phillip Parham, “with less results. Every year I look at my taxes, the board of education sits at the top.”
The school board’s millage rate is currently at 14.441. It has been as high as 16.5, in 2018, and school systems can levy up to 20 mills. Guyett said if they levy less than 14, it could cost the school system millions in funding from the state.
Jones stressed home owners should go to the assessors office and see for which exemptions they are eligible.
“It’s making property owners aware there are exemptions out there to help you with your taxes,” she said.
