Fulton County, Atlanta Public Schools Facing Cash Flow Concerns

October 31st, 2017

More than half of the Fulton County public school system’s funding comes from county tax revenue.

The Fulton County public school system announced an immediate hiring freeze and is cutting back on school field trips, effective Monday. Superintendent Jeff Rose said the schools might not have enough money to finish this semester.

The Georgia Department of Revenue rejected the county’s tax digest, because it said property owners are not being charged the right amount, so property tax bills have yet to be sent out. This summer, Fulton commissioners voted to freeze property assessments to 2016 values because homeowners saw spikes in their assessments; some more than 50 percent.

“It was clear that there were really serious errors,” said Fulton County Commissioner Lee Morris “We saw that time and time again in our hearings. Hundreds and hundreds, maybe thousands of people testifying about errors in their appraisals.

Rose said more than 60 percent of the school system’s funding comes from county tax revenue. Fulton’s been using a reserve fund to float the past four months but there’s not enough money to tide the schools over until December, he said.

“We’re getting to a very dangerous point in terms of where we won’t be able to afford some of the basics,” Rose said. “And when I say basics, I refer to even being able to pay employees.”

It’s the same for Atlanta Public Schools. APS Superintendent Meria Carstarphen outlined in a blog post the measures the school system might have to take to cut costs, including furlough days for teachers next semester.

But APS’s concerns are slightly different. The school system took out a Tax Anticipation Note, a short-term loan, to get by. If APS doesn’t pay back the loan by the end of the year, the school’s credit rating would take a hit, affecting its ability to borrow down the road.

Atlanta and Fulton County Public Schools filed a joint request with the Fulton County Superior Court for a Temporary Collection Order, which would go ahead and release tax bills, so the school systems could begin collecting some taxes. A hearing is scheduled for Nov. 3 at 1:30 p.m. before the Honorable Judge Alan C. Harvey, at the Superior Court of Fulton County, Courtroom 4A.

Commissioner Lee Morris said the county wanted to take a time-out to find a fair way to value people’s property. The county used an old law from 1880 allowing them to freeze assessments.

“We got the legal opinion [from the county attorney] and thought we were operating on solid ground. I’m still hopeful that that’s going to be the case,” Morris said.

Former Fulton County Chairman John Eaves said he was disappointed by the Department of Revenue’s decision on October 24. The county submitted its digest on October 13.

“My board made a unanimous decision to freeze the tax assessments at 2016 levels. The department of revenue was fully aware of it, and if they had any questions, it should have been expressed much sooner than now.”

A note of disclosure: WABE’s broadcast license is held by the Atlanta Board of Education.