The Georgia Department of Audits uses an annual Sales Ratio Study to measure compliance with the state requirement for counties to maintain an equalized tax digest for state education funding.  This study was released last month.   It is important for all counties to review their ratio and understand the impact it may have on the county’s budget.  Counties also have up to 30 days to appeal their ratio if they feel it is not accurate.

 

By law and regulation, counties must maintain an overall ratio between 36% – 44% or face a penalty assessed by the Department of Revenue (DOR) of $5 per parcel. When the property tax assessment cap legislation was passed in 2009, the penalties were temporarily suspended.  However, the assessment cap has expired and will not apply to the 2012 tax digest.  The Department of Revenue will reinstate the per parcel penalty next year.  A sales ratio that falls outside of the acceptable range also creates a loss of revenue due to the state cost recovery on its levy (which must be made up by the county), the loss of school revenues under the QBE formula, and the loss of a portion of the public utility ad valorem taxes.

 

For many counties, the changes in the real estate market and the artificial caps placed on property assessments by the legislature has made it difficult if not impossible to maintain an equalized tax digest over the past three years.  If your county is currently out of compliance or close to being out of compliance, your Board of Tax Assessors will need to conduct the necessary reassessments to bring your digest back into compliance for the 2012 tax year.  ACCG encourages county commissioners to review their county’s sales ratio with the Board of Tax Assessors and plan a course of action if needed to avoid non-compliance.

 

Department of Audits Sales Ratio Study