This year, local governments with the county, city and school system are grappling with some of the biggest budget deficits they’ve seen in years due to one thing — the larger than expected drop in assessed property value. 

Local property taxes are the main source of funding for public services such as law enforcement, firefighters, schools and more.

This year, preliminary tax digest estimates, or the total value of taxable property, are showing a drop ranging from 14 to 19 percent, according to Tax Commissioner RJ Hadley. 

In the past, tax digests, which have been falling since 2009, dropped more along the lines of 4 to 9 percent a year. 

For the school system, which depends on local taxes for about 42 percent of its budget, the preliminary gross tax digest for 2013 dropped about 15 percent. The year before, that it had dropped about 8 percent.

For the City of Conyers, which encompasses many of the retail hubs and industrial areas in Rockdale, the preliminary gross tax digest for 2013 dropped about 14 percent. The year before that, it had dropped about less than 0.5 percent.

For the county, preliminary estimates of gross tax digest for 2013 dropped more than 18 percent. The year before that, the net tax digest had dropped about 4.5 percent.

These looming drops mean governments and public agencies are looking at everything — from furlough days to increased tax rates to cutting jobs — to balance the upcoming budgets.

What’s behind this plunge in assessed value?

Tax Assessor Lamar Sims spoke at the May 16 school board meeting, briefly describing some of the factors behind the falling digest. 

“A couple years ago, the state created a law that anything that sold, we had to use as a guideline of the market. That included foreclosure sales and bank sales,” he said. 

SB 55, which the Georgia General Assembly passed in 2009, required that assessed values take into account foreclosure sales and bank sales, not just normal market sales as used to be the practice.

“Rockdale was not as hard hit with foreclosures as most counties, but it was a slower take.”

Advertised foreclosures reached a high of 643 in October 2010. For the first quarter of 2013, that number has been around about 100 per month.

 “A lot of properties went down 20, 30 percent. That’s the lowest since I’ve been here in Rockdale County,” said Sims, who has been working for the county for 18 years.

Although the number of appeals have been increasing, it’s still less than about 10 percent of the total parcels in the county, said Sims. 

The sale prices – and the foreclosure and bank sale prices in particular – are driving this drop in assessed value. 

The Board of Assessors office is required to do a statistical evaluation of every property each year in a mass appraisal. It attempts to physically assess every piece of property at least once every three years, said Sims. The assessed value and “market” value, which now includes foreclosures, must be within a certain range in order to keep from being fined for being out of the state mandated range.

However, Sims said he does see a ray of hope and thinks the fall in values has hit bottom.

“I’m thinking in the next two years, you'll see actual increase because we're starting to see more sales at the beginning of this year which dictates the values of next year.” He added, “I’m not saying it’s going to go up greatly; it’s going to take a minute. We’re starting to see inventory decrease but there’s still a lot of inventory out there.

The assessment notices were sent out April 26. 

The school system and city are setting their budgets for next year now. The county runs on a January to December fiscal year. The property tax rates are usually set late July or early August. 

The school board will have a special called meeting to vote on a tentative budget and 2013-2014 calendar on May 30, 6 p.m. at the Board Room at 954 N. Main Street.