Well, my alerts started pouring in yesterday from Twitter and email regarding the Georgia Senate’s unanimous approval of S.B. 346. The bill is being touted as major reform to the state’s property tax system. The summary of the bill on the General Assembly’s website states:

“A BILL to be entitled an Act to amend Title 48 of the Official Code of Georgia Annotated, relating to revenue and taxation, so as to revise comprehensively provisions regarding ad valorem taxes; to change certain provisions regarding ad valorem tax returns of taxpayers; to require annual notice regardless of changes; to provide for uniform notice forms and uniform appeal forms; to provide for powers, duties, and responsibilities of the state revenue commissioner; to provide for powers, duties, and responsibilities of the Department of Revenue regarding training of certain local tax officials and staff;to provide for an effective date; to repeal conflicting laws; and for other purposes.”

Most of the news points to the portions of the bill that call for extending the deadline to file an appeal to 45 days, instead of the current 30 days and the requirement for counties to issue annual valuation notices. Maybe it’s just me, but I do not find either of these changes to be extraordinary or innovative. I certainly wouldn’t consider them comprehensive reform.

The two portions of the bill that I do find interesting are the sections dealing with changes to appeal arbitration and what information the assessor’s must consider when arriving at their valuations.

Binding Arbitration:

Georgia previously allowed for a taxpayer to elect arbitration, but this bill significantly changes the mechanics of arbitration. The most notable changes are that the arbitration is now binding, the taxpayer is now required to submit an appraisal within 45 days of the assessor’s response to the appeal, and there will now be a single arbitrator, either agreed upon by the taxpayer and county or appointed by a judge.

Distressed Sales:

The bill introduces new language regarding the information the assessor’s must consider when arriving at their valuation. The new language states:

“(.1) ‘Arm’s length, bona fide sale’ means a transaction carried out by unrelated or unaffiliated parties, as by a willing buyer and a willing seller, each acting in his or her own self-interest, including a bona fide distress sale or sale at public auction.”

“(2.1) ‘Distress sale’ means a transaction which has occurred in good faith without fraud or deceit and includes, but is not limited to, a foreclosure, short sale, or bank sale.”

If the bill passes the House it will be interesting to see how this will work in reality.

Overall, in my opinion, this bill constitutes tweaks far more than reform.