Other Local-Option Sales Taxes: Yes or No?

BY HARRY JOHNSTON

Cherokee County is one of just three counties in Georgia without a local-option sales tax (LOST), or a similar additional 1% sales tax used to drive down property tax rates directly. Yet, property taxes set and controlled by the Cherokee Board of Commissioners (BOC) are the lowest in the metro Atlanta region, and the 28th lowest of all 159 counties in Georgia.

Like all other Georgia counties, we do have a specialpurpose local-option sales tax (SPLOST), used for roads, parks, buildings, equipment and other capital items. And, the Cherokee County School District has an education SPLOST.

However, the county does not have a transportation SPLOST (TSPLOST). I’m not pressing for either a LOST or a TSPLOST. I’m just asking — would you want to implement either one?

Georgia sales tax is 4% statewide. A LOST would push our total sales tax rate up to 7%, like most other counties. If this was implemented, our BOC-controlled property taxes would drop to the fourth lowest in Georgia.

Some people have advocated for us to implement a LOST. It would require voter approval in a referendum. The 2024 election cycle is a once-in-10-years opportunity for such a referendum, because neither the education SPLOST nor the county SPLOST need to be renewed.

An advantage of a LOST is that it causes everyone who spends money in our county to contribute to county operations, not just our residents. Remember that renters pay property taxes indirectly, through their landlords. So, a LOST would save most residents some money. However, I’m afraid they might be disappointed in the amount.

A LOST would cut our county Maintenance & Operation (M&O) tax rate from the current 4.995 mills to about 1.888 mills. The owner of a $400,000 home in unincorporated

Cherokee County, with the minimum $5,000 homestead exemption, would see their county M&O tax drop from $774 to $293. That’s an impressive 62% cut. (City residents also would see some additional savings on their city taxes.) However, the LOST wouldn’t cut the other parts of our tax bills. That same homeowner’s total tax bill, including fire and school tax, currently would be $4,144. The $481 savings off the total bill is a much less impressive 12% cut.

In some ways, a TSPLOST might be more beneficial than a LOST. It could be up to the same 1% additional sales tax, but instead of lowering property taxes, all the money would go to road improvements. If we really want to catch up and keep up on roads, a TSPLOST would do it. Cherokee’s annual road improvement budget is about $30 million. The county’s annual share of a 1% TSPLOST would be about $43 million, allowing us to more than double the road-work budget.

We’ve just completed an update to the county’s Comprehensive Transportation Plan. It shows that we probably have enough road funding to meet basic local road needs over the next 30 years. But, we won’t be able to build some helpful projects, and some we need now won’t be funded for 20 years. That’s especially true of needed state highway projects, for which state funding is expected to lag. A TSPLOST would accelerate planned local road projects, add others, and allow us to contribute to state highway projects, in order to get more of those moving.