House Bill 581
HB 581 Statewide Homestead Exemption
Georgia House Bill 581 (HB 581), which takes effect January 1, 2025, introduces a statewide homestead exemption that caps the annual increase in property values for tax purposes. This exemption impacts property taxes for cities, counties, and school districts.
While the bill aims to provide property tax relief, it will also limit the funds available for our schools, potentially affecting resources and programs. We encourage the Gwinnett County Public Schools (GCPS) community to stay informed on this issue and its potential impact to ensure our community's needs are met.
Overview of HB 581 Statewide Homestead Exemption
HB-581 establishes a floating homestead exemption designed to limit how much a homeowner’s homestead property tax bill increases when home values rise faster than inflation (measured by the Consumer Price Index or CPI). The exemption automatically adjusts as home values increase, helping homeowners manage property tax increases.
Impact on Schools
Revenue Reduction:
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Limits the ability of all school districts in Georgia to collect local property taxes as property values rise.
Long-Term Consequences:
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Reduced property tax growth means less funding for essential school programs, day to day operations, and improvements.
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Over time, this could lead to budget constraints that impact students and staff.
For Gwinnett County Public Schools:
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The inflation rate as measured by the CPI is 2.4% as of September 30, 2024, meaning all homesteaded properties in Gwinnett County would be held to this growth on property tax assessment.
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The estimated actual growth in the local real estate market is 6.0%.
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The difference between CPI and actual growth would mean a loss of $35 million in local revenue for Gwinnett County Public Schools in Fiscal Year 2025-26 and more than $100 million over the next 3 years.
Potential Impact on Individual Homeowners
Property Tax Basics: Property taxes are charged by city or county governments based on the value of your property. Certain exemptions can lower or eliminate the taxes for eligible homeowners.
Exemption Rules: For homes getting the exemption in 2025, taxes will be based on the property’s 2024 value. For later years, taxes will use the value from the previous year.
Potential financial savings for Homeowners: Based on the current CPI, 2.0% - 2.4%, a homeowner in Gwinnett County with a value of $400,000 would save approximately $10 per month in property taxes.
GCPS has been committed to minimizing the tax burden for homeowners by consistently reducing the maintenance and operation millage rate, whenever possible, while maintaining sound long term fiscal health. As shown below, GCPS has reduced the maintenance and operation millage rate by 0.7 over the past six years (From 19.80 in FY19 to 19.10 in FY25):
Opt-Out Provisions and Timeline
HB 581 allows cities, counties, and school districts a one-time opt-out of the property tax cap.
Opt-Out Procedures:
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Advertise intent to opt out in a newspaper of general circulation
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Conduct at least three (3) public hearings
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Adopt an opt-out resolution
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File the resolution with the Secretary of State by March 1, 2025
GCPS Timeline and Next Steps:
Again, this bill aims to provide property tax relief to homeowners but also poses challenges for school districts in terms of funding. It's important for the GCPS community to stay informed and participate in discussions about how to best address these changes. Here are some key upcoming dates to be aware of:
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GCPS Board of Education Public Hearing #1: January 16, 2025, at 6 p.m.
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District Presentation on Impact of Constitutional Amendment
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Public Hearing
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No Board vote is taken at this meeting.
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GCPS Board of Education Public Hearing #2: February 20, 2025, at 11 a.m.
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District Presentation on Impact of Constitutional Amendment
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Public Hearing
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No Board vote is taken at this meeting.
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GCPS Board of Education Public Hearing #3: February 20, 2025, at 6 p.m.
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District Presentation on Impact of Constitutional Amendment
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Public Hearing
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Board Vote on “Resolution to Opt-Out”
Engaging with the GCPS Board of Education:
Gwinnett County Public Schools school board meetings are open to the public and the meetings are streamed live and recorded. Community members wishing to share questions or concerns with the Board of Education are encouraged to attend one or more of the public hearings in January and February. Those wishing to speak at the public hearings in January and February can sign up in person at the public hearing before the meeting begins. Additionally, comments and questions can be sent directly to the Board of Education by emailing myschoolboard@gcpsk12.org.