As the due date for City of Sugar Hill property tax approaches (Friday, November 17), I want to follow up on my article about the City’s handling of property taxes for properties that are still under appeal.
To summarize the previous article, Georgia law mandates that if a property is under appeal and the appeal is still underway when property taxes are due, the counties must bill you at 85% of the current year’s value (the one you are appealing), or last year’s value, whichever is less. Former Mayor (now Council Member-Elect) Gary Pirkle and I found that the City of Sugar Hill was billing everyone whose values were under appeal for the full current year’s value, in contrast with the county policy.
The City’s Finance Director simply told us that this was the City’s policy. Although Pirkle and I checked with various County and State agencies and private attorneys, no one would ever say whether it was legal or illegal. But, the law that applies to counties is clear and definitely more appropriate than what the City is doing.
The City can earn interest on its tax revenue as it holds it. Interest on millions of dollars adds up fast. If the City takes in more tax revenue by billing a higher amount, it increases its potential interest earnings. I was told TWICE by a Local Government Compliance Specialist at the Georgia Department of Revenue that when the City overbills a taxpayer, it ultimately owes the taxpayer a refund, PLUS interest. To the best of my knowledge, the City is not paying interest when it overbills.
After Council Member-Elect Pirkle spoke with the City’s Attorney, the City reissued his property tax bill to reflect last year’s value. He asked the Finance Director if the City was going to reissue tax bills for everyone in this situation and was told, “We are reviewing all of the appeals.” However, I never received any notification from the City that they planned to change my property tax bill.
Since the previous article, I learned that my mortgage company only plans to pay the City the final amount of last year’s bill. They sensed something was off about the bill from the City of Sugar Hill (perhaps because the property values were different from the Gwinnett County bill they’d already paid).
Since the mortgage company was paying less than the amount due on the bill, I contacted the City to make sure everything would be okay and that I would not be charged penalties.
The good news is that the City’s Finance Director was very helpful and said,
“If you would like, I can adjust your property value to reflect that of 2022. Or we can create a final bill when your appeal is finalized. Just let me know.
If a payment is received by Nov 17th, you will not be charged interest until the appeal has been finalized and then you have 60 days to pay.”
Okay, so my case is fine. I’m not being charged penalties, and the City isn’t making extra money by overbilling me, holding the money, and then neglecting to pay me the interest with my refund.
Unfortunately, residents with properties still in the process of being appealed need to settle up with the City on their own to make sure everything is okay in their case.
And, I had to wonder, why was any of this an issue in the first place? Why isn’t billing for properties under appeal just running fairly and seamlessly?
The City has been handling its own property tax billing since 2021, when City Manager Paul Radford publicly complained that it was too costly to continue paying the Gwinnett Tax Commissioner to do it because she controversially (but legally) raised the rates.
Back in 2021, I asked Radford some questions, and he bragged about his decision to take over property tax billing and said he felt confident in the software he chose to handle the task. Although he told me that the City was saving money with its choice to handle the billing, the assertion was unsubstantiated because he refused to provide me with any documentation or even mention the name of the software.
Based on Gary Pirkle’s emails with the City’s Finance Director, we now know the software is incapable of billing property taxes the way Georgia’s counties (including Gwinnett) legally and fairly bill them because it can’t actually bill you for last year’s value. The Finance Director had to manually create temporary tax bills for the Pirkles’ home and for mine.
In an email from the City regarding my 2023 tax bill, I also noticed this:
“when we started billing property tax, we polled surrounding cities as to how they handled appeals.”
When the City started billing its own property taxes, most of the other cities in Gwinnett were just starting to do it themselves, too, due to the aforementioned controversy with the Gwinnett Tax Commissioner. They didn’t have any more experience than Sugar Hill did.
IF you were going to ask other cities, the question to ask would be, “What did your attorney say about all this?” And even that would be nonsense because the City of Sugar Hill actually has its own attorneys to ask…IF anyone there really wants to know the legal answer.
And IF the attorney said it was unclear legally, wouldn’t common sense and a sense of fairness to the taxpayers dictate that you follow the same procedure Gwinnett County was using, since that’s legally very clear and defensible, and what mortgage companies and residents were used to when the County billed for the City taxes?
The City has now been billing property taxes for three years, so the improper tax billing of properties under appeal has been going on for three years with the City flying under the radar. Either the City isn’t quite up to the task of doing its own property tax billing, or is doing things improperly on purpose because it’s less work or because it makes extra money that way.
Either way, the City owes the taxpayers an apology and a public action plan for correcting their prior bad decisions.
And probably some interest. $$
