Senate passes property-tax reform package with revenue caps, homeowner-option sales tax

The Georgia Senate passed House Bill 11-16 by substitute following a contentious floor debate in which senators described competing priorities about property-tax relief and local revenue flexibility.

Supporters argued the bill restores a mandatory opt-in for local tax relief caps and provides local governments options to replace lost property-tax revenue with a homeowner-option sales tax (a floating local option sales tax or FLO S, in sponsors’ language). The sponsor said the cap would limit local revenue growth to 3% or the rate of inflation and that many cities and counties could eliminate homeowner property taxes if they adopt the local option. ‘‘This is not a tax increase,’’ a sponsor told colleagues, arguing the proposal uses existing sales-tax authorities rather than creating a new statewide sales-tax rate.

Opponents described the measure as a regressive shift that moves revenue collection from property owners to consumers. A leading critic said the bill ‘‘moves the cost from what you own to what you spend’’ and warned that sales taxes hit households at the grocery store and the gas pump. Several senators also warned the cap could limit local governments’ ability to respond to real-world cost increases (insurance, transportation, health-care costs) and that the measure may have uneven impacts across counties.

Floor debate included detailed back-and-forths about technical exemptions (new construction, resales, TADs, and emergency provisions), opt-in timing, and the constitutional steps required to change how certain local education revenues operate. Sponsors and critics cited analyses and comparisons to other states that have revenue caps, and several senators said the House and Senate would continue to negotiate technical edits as the measure moves forward.

The committee substitute was adopted on the floor and the bill passed by substitute with a recorded roll-call of yeas 31, nays 19. Senators said further work with the House would follow consistent with standard legislative reconciliation.