Bill making property tax increase cap mandatory passes Georgia Senate

The Georgia state Senate passed a bill Tuesday to prevent local governments and school districts from opting out of a statewide homestead tax exemption, which caps annual property tax increases. After a lengthy debate, state senators voted 31 to 19 to pass Senate Bill 382, sending it to the House for review. This comes as […]

Rome Republican state Sen. Chuck Hufstetler says the opt-out measure in the current statewide homestead tax exemption “guts the protection for the homeowner.” His proposal would do away with that option. Ross Williams/Georgia Recorder

The Georgia state Senate passed a bill Tuesday to prevent local governments and school districts from opting out of a statewide homestead tax exemption, which caps annual property tax increases.

After a lengthy debate, state senators voted 31 to 19 to pass Senate Bill 382, sending it to the House for review.

This comes as state Republicans seek to pass a flurry of measures this year to lower taxes in an effort to address rising costs. House Speaker Jon Burns and state House Republicans last week proposed a plan to eliminate local homestead property taxes by 2032. A special Senate committee also called for the elimination of state personal income taxes by 2032, an initiative led by Republican Lt. Gov. Burt Jones, who is running for governor, and Republican state Sen. Blake Tillery, who is running for lieutenant governor.

Jones applauded the passage of SB 382 shortly after the vote on Tuesday and called on the House to support the bill.

What is the Georgia statewide homestead tax exemption?

In November 2024, Georgia voters passed a statewide homestead tax exemption as proposed in House Bill 581, meaning increases on property taxes on a primary residence would be capped. This is accomplished by freezing homestead values based on a yearly assessment of the consumer price index, which means homesteads would increase the same percentage, according to the rate of inflation, no matter where they are in the state.

This does not affect senior tax exemptions.

However, the bill allows local bodies to opt out of the exemption, and around two-thirds of school systems, a third of counties and a quarter of cities opted out, per a report by the Georgia State University Center for State and Local Finance.

This includes several school systems and counties in metro Atlanta, including the City of Atlanta itself.

Cordele Republican state Sen. Carden Summers said Tuesday the Senate should have never yielded on including an opt-out clause.

“We should’ve stood our ground here in the Senate, sent it back to the House and not have an opt-out clause in it. Because we knew darn well what was gonna happen is open up Pandora’s Box,” he said. “Hello, she’s here.”

SB 382 would prevent local bodies from opting out of the statewide homestead exemption.

In addition, HB 581 also allows counties to make up for revenue losses by levying a Floating Local Option Sales Tax (FLOST), a 1% sales tax (also called a penny sales tax) that runs for five years, which residents of a particular county have to approve via referendum. According to the Georgia Municipal Association, voters approved 32 of the 36 FLOST referendums on the November 2025 ballot.

The new SB 382 would also ensure that money collected through the FLOST be returned to taxpayers sooner; penny sales tax money collected through June 30 of a certain tax year would be returned to taxpayers that tax year.

What are supporters and opponents saying about SB 382? 

Rome Republican state Sen. Chuck Hufstetler, who introduced the bill, said the opt-out measure in the current statewide homestead tax exemption “guts the protection for the homeowner.”

“We’ve heard from homeowners who say they can’t afford the massive increases in their home taxes. They can’t afford it anymore,” Hufstetler said. “Affordability is a word you’ve heard a lot of this year. You’ve heard a lot of it from me for multiple years. And yet with a billion sitting in the bank, we have local governments, mostly school districts, saying they will not be able to pay their bills unless they continue these double digit increases.”

Dalton Republican state Sen. Chuck Payne said the average age of the first-time homeowner has increased over the years.

“Let’s help those young people that are first-time homeowners, and let’s help the elderly keep the homestead that they’ve had in their home for maybe 60 years and not have a widowed woman have to give up her family’s home because she can’t afford the tax man’s bill,” he said.

Acworth Republican state Sen. Ed Setzler said the bill has a “very, very small impact on governments’ ability to tax.”

“But you know what that is? That is a significant impact for homeowner predictability and certainty to be able to stay in their homes,” he said.

Some Democrats raised concerns about the proposed legislation.

Senate Minority Leader Harold Jones II said SB 382 erases the bipartisan compromise achieved in the original statewide exemption. This is because the original exemption needed voters to approve a constitutional amendment, which lawmakers could only send to the ballot with a two-thirds majority in both chambers.

“We actually did have a compromise between the two parties,” he said. “To actually be able to send this to the voters, we actually brought Democrats and Republicans to the table, to where we had to work through these particular issues, and we actually had an opportunity to influence that legislation.”

“Now, though, because we only need a majority vote, we now, today, have decided we’re about to basically scuttle all of that,” he added.

Atlanta Democrat state Sen. Elena Parent said the mandatory statewide exemption reduces flexibility for school districts and counties that have different needs or circumstances.

“A one size fits all is potentially not a great policy for a state with 159 counties that are so disparate in their population, in their median income, whether they’re even urban or rural,” she said. “We have school systems in widely different states of fiscal solvency.”

She also called the bill a “bait and switch” because it changes the language that voters approved two years ago.

Democratic state Sen. Nan Orrock, who also represents a portion of Atlanta, brought up Atlanta Public Schools’ plan to consolidate and close schools as part of the APS Forward 2040 initiative that aims to deal with budget shortfalls.

“How much do we want to hobble public education? How far should we go in that regard?” she said.

Senate Majority Leader Jason Anavitarte said Democrats only pay lip service to affordability while “their votes tell the real story.”

“They express concerns about rising costs. They speak very eloquently about the struggles of working families. They vote to maintain a system where local governments face no meaningful constraints on their ability to burden homeowners with ever-increasing tax bills,” he said.

Savannah Democrat state Sen. Derek Mallow said addressing rising costs and inflation starts with considering the needs of low-income Georgians who can’t afford to buy a home.

“You’re talking about homeownership? Well some folks can’t even own a home because they’re paying child care that costs just as much as a mortgage payment,” he said. “If we’re serious about it, we would address the things that folks are actually dealing with, because many of my folks aren’t even homeowners. They’re renters.”

This story was originally published by WABE and is available through a news partnership with the Georgia Recorder.