A new property tax reform “task force” within the Buckhead Council of Neighborhoods has begun taking aim at commercial tax breaks and discounts. The idea is to produce a list of recommended reforms to state and local governments, which were represented at the meeting by several elected officials.

The Taxes/TADs Task Force came from a team-up suggestion from Atlanta Public Schools Superintendent Meria Carstarphen, who blasted tax breaks as hurting her district’s budget at the Oct. 10 BCN meeting. BCN Chair Mary Norwood agreed at that meeting to form the task force from volunteers from the group’s member neighborhood associations.

State Sen. Jen Jordan, center, discusses property tax reform at the Nov. 14 Buckhead Council of Neighborhoods meeting where the new Taxes/TADs Task Force debuted its work. Looking on, from left, are BCN Chair Mary Norwood, Atlanta City Councilmember Matt Westmoreland and Fulton County Commissioner Lee Morris. (John Ruch)

At the BCN’s Nov. 14 meeting, task force chair Mindy Kaplan gave a “very preliminary” review of the strategy and draft recommendations for reforming part of the property assessment system. The overarching concern is that commercial property owners aren’t paying enough and shifting a large tax burden to residential owners.

Kaplan said the task force will look at three subject in turn and make a list of recommendations about each: underassessment of commercial properties; tax abatements, which critics say are often granted to spur developments that would happen anyway; and tax allocation districts, where developers get to fund a project with bonds and keep their property taxes for their own infrastructure for a certain period.

The task force is starting with the issue of commercial property assessments. The overall goal, Kaplan said, is policies that would lower the millage rate and reduce homeowner tax burden while maintaining or enhancing government services.

The task force looked at a Fulton County audit and an analysis of commercial assessments conducted by Julian Bene, a former Invest Atlanta board member and tax break watchdog who was in attendance. Kaplan said those analyses found about a 60% underassessment of commercial properties in the county, based on a comparison between the assessed values and sales prices of properties that went on the market.

More accurate assessments, Kaplan estimated, could boost tax revenue by $200 million to $400 million a year, allowing for a 15% to 20% reduction in residential property taxes or paying for more government services.

Kaplan presented four draft recommendations, partly taken from Fulton County officials, partly from task force members. The recommendations, which drew applause from the crowd at the meeting, included:

  • Increase funding to tax assessor’s office to push back against commercial owners’ tax appeals.
  • For commercial property appeals, require audited financial statements.
  • Retain documents supporting commercial appeals for at least four years.
  • Conduct annual independent audits of commercial property sales for the previous year and make those records public.

Some state and county elected officials attended the BCN meeting to discuss possible legislative solutions to various tax issues, including abatements granted by development authorities and increased homeowner exemptions. All agreed that commercial underassessment is a problem in Atlanta and Fulton.

“At the end of the day, we want people staying in their homes,” said state Sen. Jen Jordan (D-Atlanta), who chairs the Senate’s Fulton County delegation. “We’ve got to fix this problem.”

Jordan said that underassessment is an area where officials “haven’t seen the forest for the trees” while addressing other property tax issues.

“There’s no better way of putting a target on your back than going against Big Business,” said state Rep. Betsy Holland (D-Atlanta), a Buckhead resident, adding that commercial owners must be challenged on tax abatements and underassessments.

Fulton County Commissioner Lee Morris said a problem is that “we’re outgunned” by large commercial property owners who can hire experts to appeal assessments and get them reduced. Morris, a Buckhead resident, said he is likely to be forced to move to Cobb County, where residential taxes are lower, when he retires.

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