Tax Law Conflict Costing Counties Thousands; THE PROBLEM One Law Put a Stop to Updating Property Values; Another Fines Out-of-Date Counties. NOT ALONE McIntosh and 50 Other Georgia Counties Face Big Fines This Year and Worse Penalties in 2010

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Byline: MIKE MORRISON

Conflicting state laws that regulate property taxes are costing McIntosh County dearly, Chief Appraiser John Barnes told the County Commission Tuesday.

Barnes said one of the laws, House Bill 233, was enacted by the state General Assembly to freeze property assessments during the economic downturn. The law has been plagued with unintended consequences, Barnes said.

One state law fines counties if they don't keep their property values up to date, but another has placed a moratorium on updating those values.

Not that McIntosh County is alone. Nearly 50 counties around the state face the same predicament as McIntosh, including Bacon, Brantley, Ware and Charlton counties in Southeast Georgia. Others could end up in the same fix as the state conducts rotating reviews - a third each year - of the property tax books of all 159 counties in Georgia.

But McIntosh's problems are more complex than other counties, partly because of that conflict of regulations.

McIntosh County's problems arose because it is out of step with state regulations regarding the fair market value of property. Despite the economic downturn, property values in the coastal county continue to rise, Barnes said, but property remains chronically undervalued for tax purposes.

Barnes and his staff use a state-mandated formula to calculate fair market value, and when the county's property fell below that prescribed scale, penalties kicked in to the tune of $47,000 this year - and possibly more next year.

Legislators tried to provide some relief in the final paragraph of HB 233, which eliminates any fines that arise out of situations caused by the law. The Department of Revenue, however, got around that exemption with an opinion from the state Attorney General's Office, which said it could collect the penalties.

The state is due 25 cents for every $1,000 of property tax the county collects. The $47,000 is the amount necessary to bring the state's share up to what it would be if all property was properly appraised.

The penalties the county faces next year could more than double as property values continue to rise and a separate fine of $5 per parcel of taxable property kicks in. In McIntosh, there are some 12,500 parcels, Barnes said, making that fine $62,500.

The only proven way to get out of the fines is to conduct a complete revaluation of property, but HB 233 bars counties from doing that until 2012. …