Prepayment by Developer of Ad Valorem or School Taxes; Time of Effect of Prepayment Agreements; Use of Prepayment Proceeds for Public Purposes; Forfeiture of Excess of Prepayment Over Taxes Due; Validation Procedure

  1. Law
  2. Georgia Code
  3. Revenue and Taxation
  4. Ad Valorem Taxation of Property
  5. General Provisions
  6. Prepayment by Developer of Ad Valorem or School Taxes; Time of Effect of Prepayment Agreements; Use of Prepayment Proceeds for Public Purposes; Forfeiture of Excess of Prepayment Over Taxes Due; Validation Procedure

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  1. As used in this Code section, the term:
    1. "Developer" means a person constructing a development.
    2. "Development" or "development property" means a major industrial project which will employ at least 200 persons during construction or operation of the project.
    3. "Local board of education" means the county or area board of education, or in the case of an independent school district the board of education or other body, having authority over and responsibility for a school district.
    4. "Local government" means any county or any municipal corporation which has the authority to collect ad valorem taxes.
    5. "Program of public improvement" includes any or all projects for which a local government or local board of education is authorized by any provision of law to impose or recommend the imposition of taxes and shall include programs of school construction or expenditures for other educational purposes for which a local board of education is authorized by any provision of law to impose taxes.
    6. "School district" means any area, county, independent, or local school district within which all or any part of any development is located.
    7. "School tax" includes any tax authorized by any provision of law to be assessed by a local government or by a local board of education for educational purposes, including but not limited to the construction of schools and the repayment of bonds issued for such purposes.
  2. Notwithstanding any provision of law to the contrary, and subject to the conditions specified in this Code section, any developer may enter into an agreement with any local government or local board of education, or both, for the prepayment of ad valorem taxes or school taxes or both. Any such agreement may include programs of public improvements adopted by the local government or the local board of education, or any combination thereof, and shall be a lawful and binding contract enforceable by and against the local government, local board of education, developer, and the beneficial owners of any development property assessed for taxation which is the subject of a tax prepayment agreement.
  3. Each tax prepayment agreement shall become effective upon its adoption by resolution of the governing body of the local government or by resolution of the local board of education, or both, as the case may be, agreement by the developer, and the subsequent prepayment of taxes by the developer. Such tax prepayment agreement shall provide for the prepayment to the local government or the local board of education, or both, of not more than two times the estimated ad valorem tax, school tax, or both, which will be due for (1) the year in which the development is anticipated to be completed, (2) its first year of commercial use, or (3) its first year of productive use. The amount of taxes thus prepaid, without interest, shall be subsequently credited by the local government or local board of education, or both, against taxes due following an assessment of the development property by the county tax assessor or the Department of Revenue, as appropriate, in five equal annual installments beginning not earlier than the year described above for which the tax prepayment amount was calculated. In no event may the sum of credits exceed the amount of prepayment made.
  4. A local government may adopt by resolution of its governing authority or a local board of education may adopt by resolution a public improvement program to be included as part of tax prepayment agreements. Prepayment proceeds may be used for any public purpose except that the local government, local board of education, or both, may adopt a program of public improvements which is reasonably related to the anticipated increased demand for public services resulting from the development for which prepayment of taxes is made, to be funded in whole or in part by prepayment proceeds. The local government, local board of education, or both, may, by adoption of such program, provide that such funds shall be maintained in separate accounts and not be expended except for projects included in such program of public improvements.
  5. Notwithstanding any other provision of law, no tax prepayment shall create a debt of the local government or school district. To the extent that annual credits for prepaid taxes may exceed taxes due in any particular year pursuant to annual assessments of development property, the excess annual credit otherwise due that year shall be forfeited and in no event shall the developer or any other person be allowed to claim a refund of any part of a prepayment.
  6. The determination by any local government's governing authority, by any local board of education, or both as to the necessity for the public improvements to be funded by prepayments under a program established by a tax prepayment agreement shall be final and not subject to review.
  7. Nothing contained in this Code section shall be construed to require a local government, a local board of education, or any developer to enter into a tax prepayment agreement.
  8. Notwithstanding the fact that tax prepayments made in accordance with this Code section do not create a debt of any local government or school district, the validity of any such tax prepayment and the related tax prepayment agreement or agreements may be determined by application of the validation procedure set forth in Code Sections 36-82-73 through 36-82-83. However, the petition filed in such validation proceeding pursuant to Code Section 36-82-75 shall be amended as appropriate to reflect that no bonds are being issued and no debt is being incurred, and the relevant tax prepayment agreement and program of public improvements shall be filed as an exhibit to the petition.

(Code 1933, § 91A-1028.1, enacted by Ga. L. 1982, p. 2382, § 1; Code 1981, §48-5-30, enacted by Ga. L. 1982, p. 2382, § 2; Code 1981, §48-5-31, as redesignated by Ga. L. 1983, p. 3, § 37.)

Cross references.

- Exemption of development authorities from taxation, § 36-62-3.

Editor's notes.

- This Code section, which was enacted as Code Section 48-5-30 [now repealed], was originally unofficially designated as Code Section 48-5-31, since Ga. L. 1982, p. 595, § 1 also enacted a Code Section 48-5-30. Ga. L. 1983, p. 3, § 37, effective January 25, 1983, officially redesignated this Code section as Code Section 48-5-31; reversed the designations of subsections (a) and (b); revised Code references in subsections (g) and (h); and substituted "36-82-75" for "36-82-21" in subsection (h).


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