Clarkesville, Mt. Airy back property tax sales tax plan

CLARKESVILLE/MT. AIRY, Ga. — The Clarkesville City Council and Mt. Airy Town Council unanimously approved intergovernmental agreements July 13 supporting Habersham County’s proposed Floating Homestead Local Option Sales Tax (FLOST), leaving Alto as the final municipality yet to vote on the measure.

The unanimous votes bring the total number of participating municipalities to six of Habersham County’s seven cities and towns. Alto is scheduled to consider the agreement during its Tuesday night council meeting.

If approved by voters in a Nov. 3 referendum, the proposed 1% sales tax would replace a portion of county and municipal property taxes beginning Jan. 1, 2027. The tax would remain in effect through Dec. 31, 2031, with all proceeds required by state law to be used exclusively to reduce local property taxes.

“This is basically just so the county can get this on the ballot in November,” Clarkesville Interim City Manager Julie Brown told council members before the vote. “FLOST specifically goes to local property taxes. That is what has to be used for, not capital projects, which is what SPLOST does currently. FLOST specifically goes to lower property taxes, dollar for dollar.”

Brown also noted the proposal works alongside Georgia’s recently approved statewide floating homestead exemption, which limits annual increases in taxable property values for qualifying homeowners.

Mayor Franklin Brown said the measure shifts part of the local tax burden from property owners to consumers.

“It is a new tax, one cent, but every cent goes back to the property owners in way of a property tax reduction,” he said.

Clarkesville Councilwoman Leigh Johnston said the proposal also allows the county to collect revenue from visitors and others who do not pay local property taxes.

“That is a way to help capture tourism dollars and people from other counties coming into the county spending money, and a way to capture dollars from folks that are renters, but do retail purchases and sales within the county,” Johnston said. “So it captures some money that way as well to go toward the property owners.”

During the Mt. Airy meeting, Mayor Adam Tullis described what the proposal could mean for homeowners if approved by voters.

“In a nutshell, this is what we’re going to put before the voters in November,” Tullis said. “On a $400,000 house in the city, you’d save approximately $1,000 to $1,100 on your property tax.”

The exact amount of any property tax reduction would depend on sales tax collections after the measure takes effect.

Under the intergovernmental agreement, Habersham County and participating municipalities would distribute FLOST revenue according to a formula established before the referendum. The proceeds could only be used to reduce county and municipal ad valorem taxes and could not be spent on capital projects or general government operations.

Baldwin, Cornelia, Demorest and Tallulah Falls approved the agreement last week. If Alto also approves the measure Tuesday, all seven Habersham municipalities will have endorsed the proposal before it goes before county voters in November.