A property tax increase that affects only certain Augusta property owners is in the works to replace revenue lost countywide.
The increase, given tentative 7-0 approval by the Augusta Commission, means property owners outside the old city limits will pay an additional 0.55 mills in fire taxes, though the revenue collected pays for fire service everywhere.
City Administrator Fred Russell said that the owner of a $100,000 house will see a $19 annual increase in local city taxes and that the increase doesn’t have to be advertised because it’s within a special tax fund.
The increase will replace about $1.7 million in lost state fire insurance premium taxes, according to Finance Director Donna Williams.
Augusta’s share of state revenue was reduced last year to about $9.3 million after it posted no population gains in the 2010 census, Deputy Finance Director Tim Schroer said.
Raising taxes on part of the city for services delivered citywide reminded Mayor Pro Tem Joe Bowles of the disparity that still exists in the city’s tax system more than 15 years after consolidation.
Though he voted for the tax increase, Bowles called the system “illegal” and said he might file a lawsuit Jan. 4 after leaving office to compel the city to even it out.
Residents in the old city, now less than a third of Augusta’s residents, pay for trash pickup, fire protection and other services by two mill rates, a general fund millage and an urban services millage, which add up to 16.896 mills.
Residents living outside the old city limits pay the general fund millage and the fire tax millage that the commission raised to 2.152 mills, plus a separate fee for trash pickup.
All other millages levied by city government are expected to remain about the same. The rate is the amount per $1,000 of a property’s taxable value used to calculate an owner’s tax bill.
Cliff Channell, whose firm Channell Realty owns or manages hundreds of rental properties inside and outside the old city limits, wasn’t bothered as much by the disparity as by the increase, which he said was unnecessary.
“The only reason they would need it is to increase their pay,” Channell said, mentioning a fire truck that hit a Walton Way fire station recently. “If they have drivers that are going to knock out a center post, they don’t need any more money.”
Each mill rate in Augusta-Richmond County is limited by a cap imposed by state law during the 1970s. In a presentation to the commission last week, Russell said that although the general fund millage is at 86.4 percent of the cap, the fire fund millage was only at 71.1 percent.
District 7 Commissioner Jerry Brigham backed the tax increase and said more of a recently discovered 2011 budget surplus of $1.6 million ought to be directed to the fire fund to further cushion the department.
The tax rates must be advertised twice and approved again by the commission before they can be used to calculate tax bills coming out later this year.