2016  Annual Report

                   Hart County Property Owners’ Association

                                      P.O. Box 631
                           Hartwell, Georgia 30643

                           Email: hcpoa@hartcom.net

                           Website: http://hcpoa.info

To: All HCPOA Members

New Year...new format. In the past, the Annual Report has provided our members with a year- end summary covering HCPOA’s numerous inter-actions with local government agencies. This year, the Executive Board has decided to take a slightly different approach by providing an annual review that covers both the “good and not so good” actions taken (or in some cases not taken) by local government officials that have had a significant impact on our members.

The underlying problem ...two independent government agencies depend on revenue from a common source ...property owners. There are two local government agencies that are dependent on property taxes to fund their budgets: the County Commission and the School System. Each of these agencies is authorized to independently set their own millage rate and levy taxes. These agencies are not required to coordinate their budgets and as a result, there is no county-wide ceiling on taxation other than statutory limits on maximum millage rates. Consequently, there is no incentive for these agencies to (1) voluntarily limit taxation, or (2) to annually negotiate with each other to agree on an equitable distribution of available tax revenues. With the limitations of this taxation method in mind, let’s see how these local government agencies performed in 2016. 

                                                                                                                  County                              School


Annual Budget                                                                                        $11,139,664                        $28,359,794 

Property tax received                                                                                $4,375,000                        $12,536167                                                                              

Property tax revenue as a percentage of the budget                                      39.27%                                44.20%                                                                

Property tax received as a percentage of total property tax collected             25.87%                                74.13%           

Total property tax received by both government units = $16,911,167


The numbers in the chart regarding 2016 property tax revenues were taken directly from published budgets except that the 2016 county budget numbers were extracted from the latest budget draft. 

 The County Commissioners: In general, the County Commissioners are very aware of their responsibilities to keep taxes low for both property owners and other county tax payers. The process used by the Commissioners to reach a consensus can be slow, tedious, and at times contentious, but it usually works. At all times the Board’s deliberations are open to the public and citizens are encouraged to comment on issues of concern. In 2016, as in most years, much of the Commissioners’ efforts were focused on developing the annual budget. It was particularly difficult this year because of pending increases in health care costs that would necessitate a millage rate increase and a corresponding tax increase. This situation was further complicated by the lack of sufficient reserve funds to absorb unplanned budget increases.

The HCPOA Board recognized that there was a substantial imbalance between the reserve funds available to the County Commission versus the School System...too low at the County level and much too high at the school system. So, to avoid a property tax increase, HCPOA proposed that the school system lower its millage rate slightly to offset the unavoidable increase at the county level. Lower revenue at the school system could easily be replaced by withdrawing a small portion of their reserve fund. The School Board refused to even consider helping the County out of its budget dilemma and a 20% increase in the county millage rate was then inevitable.

The School Board: HCPOA’s relationship with the Board and Superintendent has been “strained” for several years for two overriding reasons:

      (1) a total lack of transparency regarding financial management, operating policies, and the opaque nature of their                   decision making process

      (2) a conscious effort by the school board to “stone wall” any response to tax payer inquiries, suggestions, and                      complaints.

Our Board has tried repeatedly to resolve these differences though private meetings with school officials, informative presentations at HCPOA public meetings, plus guest editorials, letters to the editor, and “Property Owner’s Corner” ads in the Hartwell Sun. So far, none of these approaches has produced positive results. If anything, the school board’s attitude has been to harden its resistance to taxpayer input and to double down on its refusal to recognize that it has a fiduciary responsibility to act as a “Good Shepherd” by protecting the financial interests of the taxpayers who provide the school system with its operating funds.

In addition to the policy differences listed above, two operational issues consumed a large portion of our time this year:

       The unprecedented cash reserve accumulated by the school board over the past 5 years eventually reached $14M           this year. The technique used by the school board to accomplish this goal was fairly simple. Excess funds were                 generated by inflating the budget beyond justifiable needs and then limiting school expenditures to amounts well               under the budgeted revenue. The unused funds were then transferred to the reserve account with no identifiable               use in mind. Although this practice is strictly prohibited by law (C.O.G.A. 20-2-167(a)5 the school board has                       refused to comply with its provisions and has denied that any such legal limitations exist. HCPOA is using every               available resource to force compliance but, so far, we have been unsuccessful.

       We suspect that in May the school board began to realize that pressure was building to lower the reserve fund to a          more modest amount. So, to get ahead of the game, they engaged in a spending spree that, over the next six                    months, reduced the reserve fund by almost 10 million dollars. Where did the money go? That’s the question that             we’ve been asking the school board since November. Unfortunately, the board has refused to respond in good faith           to several Open Records Requests submitted by HCPOA. These requests seek to identify, by line item, exactly how        much of the reserve was expended this year, for what purpose, and from whom the purchases were made. So far,            the board’s responses have been vague, lacking in any detail, and totally uncooperative in regard to providing clear          straightforward answers to our simple questions.

Both of these issues are on-going and we are actively pursuing resolution. As most of our members recall from past experience, your Board is persistent, thick skinned, and full of ideas and potential solutions. Rest assured that we will continue to aggressively seek answers to these questions in 2017.

Hartwell City Council: HCPOA’s membership is drawn primarily from Hart County residents who live outside the city limits of Hartwell. Since we have a limited staff of volunteer members, we are unable at this time to monitor the actions of the Mayor and City Council. Hopefully, as our membership continues to grow, we eventually will have the manpower to expand coverage to include this government agency as well. Note: Tom Hardigree and Lee Brinson usually attend the Hartwell City Council meetings and report on the Council’s activities during their TV program, “BackTalk Live”, which is broadcast locally on Hart Communications Channel 3 every Thursday night at 7:30 PM.

Corps of Engineers: While the Corps is not considered a local government agency, their actions often impact a large segment of the County’s population. This year was no exception. In January, the Corps, without consulting any of the Lake Hartwell stakeholders (i.e. property owners, county, state, and federal officials), arbitrarily revoked the policy of granting new permits and renewing existing water permits that allow lake water to be used for irrigation purposes, a policy which has been in effect for 50+ years. This action would have prevented lakeside property owners from using water drawn from the lake to irrigate their gardens, lawns, etc. The implications of this order were widespread considering our members’ extensive investments in landscaping, irrigation equipment, access to alternative water sources, and property values. The reaction from all quarters was immediate and vigorous. HCPOA quickly contacted our U.S Representative Doug Collins plus representatives from the offices of Sen. Isakson and Senator Perdue, asking for their assistance. These officials, or their representatives, met in Hartwell on January 18 with HCPOA members and representatives from the local Corp of Engineers office along with the Executive Director of the Lake Hartwell Association. Eventually the order was rescinded by the Corps, but with the admonition that it might be reconsidered as part of the next revision of the Lake Hartwell Shore Management Plan which is scheduled for 2017. We are watching developments closely along with other government officials and will act swiftly to counter any future attempts to impose similar water restrictions.

Other Activities: There were, of course, numerous other less urgent problems that HCPOA addressed. The ones described above were, in our opinion, the ones that had the most potential for affecting the financial interests of our members.

Thank you for your continuing support, both financial and otherwise. We are, and will continue to be, a pro-active organization that is dedicated to keeping our members informed. We look forward to serving you in 2017 and beyond.

Written by Ritch Vandeventer for the HCPOA Executive Board

February 25, 2017