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Augusta uses urban taxes contrary to city charter

Filling the gaps

Saturday, Oct. 6, 2012 5:05 PM
Last updated Sunday, Oct. 7, 2012 2:50 AM
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Joe Bowles lives in a nice house on Milledge Road, so he pays a lot in property taxes – more than $8,500 a year.

Augusta Commission member Joe Bowles has said he will sue the government if some action hasn't been taken to equalize the property tax system before he leaves office in January.  SARA CALDWELL/FILE
SARA CALDWELL/FILE
Augusta Commission member Joe Bowles has said he will sue the government if some action hasn't been taken to equalize the property tax system before he leaves office in January.

Most of that goes to Richmond County schools, but he pays about $1,900 because his address lies within the city’s Urban Services tax district, which means he pays more for fire protection, streetlights and trash pickup than his counterparts in the suburbs.

But it also means Bowles pays more for other services in the city budget, such as bus service and law enforcement, and that appears to run counter to Augusta’s city charter.

Bowles, who represents the third district on the Au­gusta Commission, said it is a situation the city can’t justify.

“The whole thing is just crazy,” he said. “The more you look into it the more problems you will find.”

According to an analysis by The Augusta Chronicle, millions of dollars are being diverted each year from the city’s Urban Services tax district to fund government departments and services, and those transfers appear to be contrary to Augusta’s consolidated government charter.

The Chronicle found that since 1996 more than $60 million was transferred from the Urban District to supplement services in the county’s general fund. City officials say it’s because they are using an imperfect system with built-in problems that date back to consolidation.

When the city of Augusta and Richmond County merged in 1996, the consolidated government created a two-tiered property tax system – one for suburban dwellers and another for those who lived within the old city limits. The bill that consolidated the governments stated that an Urban Services District would be formed and additional property taxes would be “imposed on account of governmental services available therein that are not furnished in the Suburban Services District.”

The bill stipulates that these services were to include “fire protection of a higher class, garbage pickup, and governmental water and sewer services, and such other services as may be provided only in an Urban Services District.”

Those rules, however, have never been strictly followed by the Augusta Com­mission.

Filling the gaps

Since the first year of consolidation, the Augusta government has used Urban District revenue to fill holes in the budget when the general fund came up short.

More than $2.9 million has been diverted to the general fund, another $2.9 million to the Port Authority, $5.5 million to Housing and Neighborhood Development and another $780,000 to Riverwalk Augusta, according to The Chronicle’s analysis.

The biggest recipients of Urban Services money have been the municipal bus service, which received more than $23 million, and the sheriff’s office, which was given more than $21 million.

None of these services appears to be only for the Urban Services District, as the charter stipulates.

Augusta Finance Director Donna Williams said that all these transfers have been approved by the commission and that none has been questioned by external auditors. She said that these departments, and others, are associated with Augusta’s more urban areas and have some history of being funded by the old city.

Some services and departments have been funded with Urban Services money from the beginning of consolidation. Those include the fire department, streetlights, trash pickup and bus service. About $10.9 million also has been used to fund the Downtown Development Authority since 1996.

Other transfers from the Urban District have come and gone over the years, depending on necessity.

Funding for the Port Authority ceased in 2010. Housing and Neighborhood Development funding began in 2002. In some years, money was transferred to Augusta Municipal Golf Course and to Newman Tennis Center. In other years, money went to Riverwalk Augusta and to the Emergency Telephone Response system.

The peak year for these transfers was 2006, with more than $6 million going to services not exclusively reserved for the Urban Dis­trict. This year, the budgeted amount was more than $4 mil­lion, with most of that dedicated to law enforcement – a service provided to all residents of Augusta-Rich­mond County.

In 2004, the Urban Ser­vices District was tapped for about $2.3 million to supplement the Richmond County sheriff’s budget. That has continued every year, increasing to $3 million budgeted for the 2012 fiscal year.

Downtown focus

City Administrator Fred Russell said the rationale behind that has to do with the concentration of resources downtown.

“There are going to be a lot more calls for service in the urban area,” he said.

According to the city’s own crime statistics, however, some of the areas with the most crime reports, such as Richmond Hill and Barton Chapel roads, lie outside the Urban District.

Proportion of service isn’t necessarily the standard applied to all transfers, either.

For example, the proportion of the Augusta Fire Department’s budget that was funded by Urban District money increased from about 17 percent in 2011 to roughly 21 percent in 2012. Fire Chief Chris James said the effort in recent years has been to spread out fire stations to improve service in the suburban area, not downtown.

“We are working to make that system as a whole better,” he said.

Williams said she has made a conscious effort in recent years to eliminate some of these transfers and pare them down to what is essential to get the job done. Augusta’s property tax system might be deeply flawed, but it is the only tool she has to work with.

“We are playing with the hand that we have been dealt,” she said.

Williams also noted that most of the revenue in the Urban Services District comes from local option sales tax, not property tax. In fact, property taxes – on real estate and automobiles – make up between 40 percent and 45 percent of revenue each year and don’t even cover the main reasons for the tax – fire protection, trash pickup and streetlights. Most of the rest is sales tax revenue.

That sales tax money, however, would not be there if it were not for the additional millage charged in the Urban District. By state law, sales tax money is used to “roll back” both urban and countywide mill rates. If the Urban District did not exist, the sales tax revenue would be spread across the main county tax rate, Williams said.

On the positive side, that would be an additional $8.7 million credit applied against the taxes of all property owners. On the negative side, it would mean about $6.9 million in missing ad valorem taxes from the Urban District. To make up the difference, the city would have to raise everyone’s tax rate, Russell said.

But even that solution is problematic, given that Richmond County is operating under a tax cap law that restricts increases in the millage beyond a certain point, and that changes each year, depending on fluctuations in the tax digest.

“We operate on a fairly lean tax bill,” Russell said.

Bowles said corrections in Augusta’s convoluted and unbalanced property tax system are long overdue.

He has put the issue on the commission’s Fi­nance Com­mittee agenda to be discussed Monday.

“We will see where the discussion takes us,” said Bowles, who has said he will sue the government if some action hasn’t been taken before he leaves office in January.

Richmond County Tax Com­missioner Steven Ken­drick said he would like to see some kind of action. He would like to be part of a task force from several departments that takes a hard look at the problem and brings some solutions to the table.

Even though he doesn’t set the tax rate, he said, he fields phone calls from puzzled and angry taxpayers who are confused by Augusta’s property tax system.

“The average taxpayer wants to believe that we are providing them all the same benefits for the same amount of money, but at times that is not the case,” Kendrick said.

Sometimes the answers are easy and sometimes not, he said.

“I get those kinds of questions all the time,” he said. “The question often becomes, ‘Why hasn’t this been changed by now?’ That’s where we hit the roadblock.”

WHERE THAT MONEY GOES

A look at expenditures in the Urban Services District from 1996-2012:

General fund$2,992,131.87
Port Authority$2,940,403.97
Emergency Telephone Response$200,000
Housing & Neighborhood Development$5,507,380
UDAG-LaneyWalker Bethlehem$24,825.85
Capital outlay$333,996
Law enforcement$21,747,283.53
Downtown Development Authority$10,988,418.76
Augusta Public Transit System$23,174,030.97
Augusta Municipal Golf Course$208,659.42
Newman Tennis Center$246,569.53
Old Government House$15,000
Riverwalk Augusta$782,240
Employee Health Benefits Fund$6,733.25

Comments (19)

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OpenCurtain
10049
Points
OpenCurtain 10/06/12 - 09:34 pm
6
0

No Surprise

County residents have been saying for years that the merger was nothing more than way to find a new pot of tax money to spend downtown.

Just what does the Port Authority do that justifies $2,940,403.97 worth of tax funds?

An why do we have a DOWNTOWN (anything) Authority?

dichotomy
26594
Points
dichotomy 10/06/12 - 10:05 pm
6
0

The problem here is that our

The problem here is that our leaders have SPENT US BLIND and have done so with a crooked tax system that is coming home to roost. NOBODY in Augusta should be paying much more than about $5000 a year in taxes and most should be paying between $1000 and $2000.

And, of course, their answer is "if we fix the system we will have to raise everybody's taxes".

If they raise my taxes much more they will have to sell it on the courthouse steps. My house payment is already double what it was when I bought out here. The taxes are more than the P & I. That is ridiculous.

Consolidation was crooked. They tax us illegally. They con us out of SPLOST money and then spend that illegally. When will the MAJORITY wake up and start paying attention to who they vote into office.

We need a new tax system, a new commission, a new administrator, a new tax commissioner, and a new appraiser, and a new mayor. I know it would be difficult to find that many HONEST people in RC but that is what we need.

Young Fred
13775
Points
Young Fred 10/07/12 - 07:33 am
6
0

hmmmm

The Head Honcho Bureaucrats tell us that it's merely an accounting problem, simply shifting moneys from fund A to fund B.

Nothing to fear peons! We know how to best spend YOUR money, we'll just tell you (when we forcibly collect it) how we're going to spend that money, and HOCUS POCUS we'll spend it where WE see fit! Budget? We don't need no stinking budget!!!

But hey, that's just “government” (they tell us), the way it has ALWAYS BEEN and ALWAYS WILL BE, you'd be foolish to think otherwise.

Be quite and leave your money to your betters.

soapy_725
43306
Points
soapy_725 10/07/12 - 08:22 am
0
0

The King and his princes

Unpublished

know what is best for their sheeple. Despite the fact that their are some 200K plus more sheeple that kings and princes. And even with their army (RCSO) the odds are the sheeple will win. It takes will to fight tyranny. And tyranny is what exist in ARC. When those in power do no represent the will of the people, the people have the right to throw out those in power.

What is the fear of not paying taxes? Will every property owner be thrown in jail? Ain't happening now? Not enough beds. The police will shoot you? To much paper work and time off for discharging their weapons. Paper work strikes fear into the RCSO almost as much as stopping an illegal emigrant for driving to close.

California, as sick a mess as it is, knows how to stop a proposition at the voting booth.

May Honey Boo Boo does represent Georgia? Can she be a write in for the 12th District.

B&M, B&M, that is all the taxpaying sheeple of ARC know how to do. BAH BAH BAH The king and his princes are laughing their arses off at you.

Bulldog
1251
Points
Bulldog 10/07/12 - 09:41 am
2
0

Missed Point

Open Curtain appears to miss the point. Excess tax is being collected from people who live in the "old city", urban district and illegally spent outside the downtown area. However, we do all agree that that the system is badly broken and must be dramatically revised. I still believe that crime and the perception of crime has caused and continues to cause the flight of the middle class to Columbia and Aiken Counties. This in turn adds to the downward pressure on real estate prices and in turn depresses tax collections. Unless the Richmond County Sheriff's office is funded to the point where citizens feel safe, we will continue to see a downward spiral.

Tullie
2930
Points
Tullie 10/07/12 - 09:43 am
2
0

I'm Confused Again

On Sep 15, 2012, Steve Crawford had this as part of a chart explaining property taxes:

URBAN DISTRICT PROPERTY OWNERS

• Urban tax, which is intended for better fire protection, street lights, trash service and other things in the old city area

• Solid waste fee. The flat $107 fee pays for a portion of city trash service.

SUBURBAN DISTRICT PROPERTY OWNERS

• Fire protection tax, which funds the Augusta Fire Department

• Solid waste fee. A flat $302 fee is charged to property owners with city trash service.

• Street lights fee, which is based on the amount of street frontage for a given property.

Then in the above article he says:

Most of that goes to Richmond County schools, but he pays about $1,900 because his address lies within the city’s Urban Services tax district, which means he pays more for fire protection, streetlights and trash pickup than his counterparts in the suburbs.

So..which is it? Urban or Suburban that is supposed to be higher?

And when I called about my trash being $310 and some change she said that he used what went out for 2010 taxes not this year..it went up and has caused a lot of confusion. She has been getting a lot of calls about this.

I never have gotten a call back about the street light charge..I want an explanation about how they figure the amount based on street frontage..I need to call him back.

Riverman1
70446
Points
Riverman1 10/07/12 - 09:56 am
3
0

Most Money Spent in Old City

It's obvious most the tax money of all kinds spent ends up in things like the TEE Center in the old city. Heck, Laney Walker gets $50 million over the coming years just because. Heh.

Young Fred
13775
Points
Young Fred 10/07/12 - 09:57 am
3
0

Trash pick-up/"solid waste fees"

$302 or $310 whichever the case may be, is highway robbery.

Steve Crawford
80
Points
Steve Crawford 10/07/12 - 10:08 am
1
0

Your tax bill

Tullie - If you like, you can e-mail me and I will explain your property tax bill. It is unfortunate that Richmond County's tax system is so complicated that you need a handbook to decipher it. My e-mail: steve.crawford@augustachronicle.com

JRC2024
6955
Points
JRC2024 10/07/12 - 11:20 am
4
0

50 million spent in the Laney

50 million spent in the Laney Walker area is just going to get wasted. You have to get rid of the crime in that area before it will be populated with people who care and will not tear everything up.

rebellious
18704
Points
rebellious 10/07/12 - 12:42 pm
2
1
dichotomy
26594
Points
dichotomy 10/07/12 - 01:19 pm
3
0

Part of the problem is that

Part of the problem is that Consolidation should never have happened. There is too large of an area of the county that does not have the services that the urban districts, and some of the suburban districts have. The rural areas do not have street lights, do not have sewer service, and are charged much more for garbage service and I suspect for fire service even though we do not have as good of fire coverage.

Regardless of what they say, I think the rural taxpayers are getting the shaft. Our property is over valued and we have skimpier fire and police protection and an overpriced garbage service.

If someone is trying to make the case that the rural taxpayers should be paying more, then I ain't buying it. If you want me to feel sorry for the urban people because they have sidewalks, street lights, better police and fire protection, and they pay less for garbage service, then I ain't buying that either.

I suggest you implement a county wide system that values property for tax purposes based on it's fair market value in that area and then add in fees for each property for the services that property receives based on what it costs to provide them in that area....OR......average out a fee county wide for services that EVERYONE receives like garbage and fire and exempt properties from fees for services that many do not have like street lights.

My guess is that if you ever implemented a fair and equitable system and quit illegally using other monies to subsidize some areas that when all people had to pay for all of your crazy spending they would vote most of you out of office.

SemperParatus
3225
Points
SemperParatus 10/07/12 - 01:29 pm
3
0

One for all

There should be ONE property tax rate for ALL taxpayers residing in Augusta Richmond County. Period.

Little Lamb
40104
Points
Little Lamb 10/07/12 - 01:55 pm
1
0

Rules

From the story:

Those rules, however, have never been strictly followed by the Augusta Com­mission.

Is anybody surprised?

Fred and the commission will not change the status quo until a judge rules against the city in Bowles’ lawsuit.

countyman
16787
Points
countyman 10/07/12 - 04:30 pm
0
3

Interesting nobody mentioned

Interesting nobody mentioned the citizens of the urban district paying more than the suburban counterparts in terms of basic services.

I'm not defending how the DDA spends the money, but them The receiving $10 million over 16 years.. That's nothing compared to the $20 million vocational magnet school underway, $3.5 million going to the Regency Mall lake, or the millions spent at Diamond Lakes.

The TEE Center was approved the local tax payers of the county, and the Laney Walker/Bethlehem is $37.5 million over 50 years.. The money is coming from the local tourist visiting Augusta..

Riverman1
70446
Points
Riverman1 10/07/12 - 07:53 pm
1
0

"The TEE Center was approved

"The TEE Center was approved the local tax payers of the county, and the Laney Walker/Bethlehem is $37.5 million over 50 years.. The money is coming from the local tourist visiting Augusta.."

The lion's share of that hotel-motel tax is generated outside of the old city, out around I-20 and 520, yet we simply allocate it to Laney Walker as a payoff for the TEE being built downtown??? They should have been paying off South and West Augusta.

Riverman1
70446
Points
Riverman1 10/07/12 - 07:56 pm
0
0

I really don't believe South

I really don't believe South Augusta would have minded if the technical high school had been built else where. A school like that draws students from all over the county. It's a school, not a TEE center.

Tullie
2930
Points
Tullie 10/08/12 - 07:28 am
0
0

Steve Crawford

Thank you, I sent you an email a few minutes ago. Appreciate any assistance on understanding how they figure the street light bill. I can't find anything about the road frontage online.

Tullie
2930
Points
Tullie 10/08/12 - 07:56 am
0
0

Joe Bowles

I hope when you sue the government, because I doubt anything will be done, that it will help the poor schmucks like me.

I think it is a telling situation that we have commissioners, Fred Russell, and everyone else that has known of this and they have done nothing, absolutely nothing to correct this.

I want a divorce from the City of Augusta. The consolidation was such a huge mistake as most of us knew it would be. By their own admission we have people that can't figure out how to get this sorted out. That is sad.

Tullie
2930
Points
Tullie 10/09/12 - 07:54 am
0
0

Steve Crawford

Thank you so much for all your help, you are the best!

He really went out of his way to help me understand this street light charge on the tax bill, I really appreciate that.

He gets five thumbs up for being so patient and kind :o)

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