Memorandum from Mary Kay Murphy
Mary Kay Murphy, Ph.D. District 3  School Board Member marykaymurphy@aol.com

January 10, 2007 

Funding Georgia’s and 
Gwinnett’s Public Schools

   Changes in funding public schools through Georgia and in Gwinnett County are being proposed during 2008 by both the Georgia House and Senate. It is important for parents, educators, and citizens to be aware of the impact that these proposed changes could have on local control of education in our county—and in the other 179 counties throughout Georgia. 

   Two measures that would change the funding of public education statewide include HB 900 – the GREAT (Georgia’s Repeal of Every Ad Valorem Tax) Plan—and a corresponding Senate Bill that would provide that homestead values be allowed to increase above the 2007 level by only one percent if ownership remains the same.

   HR 900 is sponsored by House Speaker Glenn Richardson. The Senate Bill is sponsored by Senator Eric Johnson. Both are expected to be presented to the Georgia General Assembly in the 2008 session.

   If both the House and Senate pass the GREAT Plan, a referendum to change the State of Georgia constitution would be held in the November 2008 General Election.

   The GREAT Plan substitutes school revenue that would have been received by school boards from local property and ad valorem taxes on personal vehicles with promised reimbursement from the State of Georgia. It is promised that these new funds would come from new taxes on groceries and some consumer services.

   In addition to the freeze that would result if the Senate bill were to pass, public education revenue increases from property taxes would be limited to the state government inflation rate. 

   A coalition of concerned citizens and organizations throughout Georgia has formed to oppose passage of the GREAT Plan in the House of Representatives and of the freeze on property taxes as proposed in the Senate Bill. This coalition includes the Georgia AARP (the Association of Retired Persons), the Georgia PTA Council (Parent Teacher Association), the Georgia Municipal Association, the Georgia Budget and Policy Institute, the Georgia School Boards Association, the Georgia Association of Educators, and many other education, municipal, and community organizations.

   Opposition to the GREAT Plan is based on several major concerns. The first concern is loss of local control at the city, county, and municipality levels to generate revenues to fund public education from the local source, whether it is a revenue limit or a limit on assessments. 

   The second concern represents opposition to the use of sales tax instead of property tax to fund public education. 

   The third concern reflects the cap on funding for Georgia’s 180 school systems of public education. Such a cap on funding in Gwinnett County would adversely impact the largest school system in the state which annually experiences increases in student enrollment projected to continued at an average of 4,000+ students a year, requiring increased numbers of teachers, support staff, classrooms, school buses, and counseling and special education services.

   The impact of passage of HB 900 and the Senate legislation that would freeze property assessments includes the following:

  • Reliance for funding shifts more to the state, thus reducing the ability of elected school boards to create and/or improve programs to address local school system needs. Thus, programs funded solely or primarily with local funds—such as art, music, elementary foreign language, nurses, locally paid teachers to reduce class size, coaching supplements, soccer programs, etc—could be placed at risk.
  • Current significant underfunding of public education would be locked in with little hope of it ever being addressed from the state level. Also, there would be less ability to address such underfunding from the local level.
  • Concern about what happens with reduced capacity to raise revenue locally if the tax grants are given to homestead property owners, but there is a shortfall in funding for education.
  • Citizen influence on budget decisions would largely shift from, typically, 5 to 7 school board members, to the Governor, 180 House members, and 56 Senate members.
  • Federal income tax credit for property taxes no longer paid would also be a loss for Georgia and Gwinnett taxpayers.
  • Senior citizens, exempt from the school tax in many of Georgia’s communities, would suddenly see a tax increase because they would pay 4 percent on groceries and many consumer services such as banking, legal, membership fees, property improvements, transportation/travel, and vehicle services.

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