On Thursday, Georgia lawmakers heard testimony about possible legislation that would create a new 1 percent education sales tax.
The resolution, HR 319, introduced last year by Rep. Bubber Epps, was heard by lawmakers and other education leaders from around the state. Epps’ resolution was tabled in the 2017 session. The resolution aims to propose an amendment to the Constitution to authorize local boards of education to impose, levy, and collect a 1 percent sales and use tax for maintenance and operation expenses of local school systems.
Historically, the primary source of funding for school renovation and new construction was a local property tax, as it is in most states across the nation. The Georgia legislator gave counties the option to implement a SPLOST starting in 1985 – a 1 percent sales tax to fund specified capital improvement projects including transportation, parks and recreation, public safety, library, and court facilities. In 1997, voters in Georgia approved an amendment that allowed local boards of education to use a similar 1 percent sales tax for school construction, called E-SPLOST.
Currently, local school boards already have this option to levy Education Special Purpose Local Option Taxes (ESPLOST). Such taxes allow a local school district to call for a referendum to approve a one percent sales tax to help fund school facility improvements. It can be used to pay for school construction, equipment, retire debt, and buy technology, but ESPLOST cannot be used to pay operating expenses, such as salaries. The time frame on the tax has a length of five years.
Georgia has a relatively robust commitment to capital funding for schools, including between $250-300 million per year from the state. Locally, 30-35 percent of the schools financing comes from state coffers, and funding for maintenance and capital expenses go underfunded. In the poorest parts of the state, state funding for K-12 public facilities can be upwards of 75 percent.
Many at the hearing spoke in favor of levying the new education tax because of shortages in the funding mechanisms that help fund schools have gone underfunded for some time. The new version of the tax would follow a similar time frame of expiring in five years. It is not known from the hearing if additional flexibility or specific applications will be granted in the new tax policy.
Historically, building projects can take too long to complete at the time an ESPLOST expires. A popular complaint among school leaders throughout the state is that many projects could be completed if additional flexibility was allowed and hope for more clarity about applications of funds.