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Jun. 22, 2018
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Hall County marinas win tax appeal for 2015-2017

By Pamela A. Keene
 
Marinas in Hall County got a surprise from Hall County Board of Tax Commissioners with their 2015 tax assessments – a dramatic tax increase from 2014 to 2015. The marinas have gone to court to clarify the issue. The Supreme Court of Georgia recently ruled in the marinas’ favor on a procedural issue, requiring the board of commissioners to uphold the lower values from 2014 for the 2015-2017 tax years.
 
The county appealed. However, on Monday, February 19, the Georgia Supreme Court denied Hall County’s request to reconsider its decision in favor of the marinas for tax years 2015-2017. “We are extremely pleased with this decision, which we consider final,” said the marinas’ attorney, Ethan Underwood. 
 
The legal action involved the 2015 tax assessments of Westrec Properties, PS Recreational Properties, Chattahoochee Parks, March First and AMP III-Lazy Days, which respectively represent Sunrise Cove and Snug Harbor Marinas, Holiday Marina, Aqualand Marina, Gainesville Marina and Lazy Days Marina.
 
The marinas’ valuations jumped dramatically between 2014 and 2015 when the county considered docks and additions as real property instead of personal property. Underwood said his clients believe the marinas’ property should have been taxed as personal property, leading to the initial appeal.
 
“The board made a change to tax our floating and moveable docks to assess them as real property instead of personal property, in effect increasing our tax assessments in 2015 to between 350 and 3,200 percent,” said Alex Laidlaw, vice president of operations for Westrec Marinas, which owns and manages Holiday, Lazy Days and Sunrise Cove marinas, all located in Hall. “We lease our real estate properties as concessionaires from the Corps of Engineers, and in our agreement with the Corps, the language is very clear about what fees are paid and how the funds are to be distributed and why.”
 
In a nutshell, the marinas pay their fees to the Corps of Engineers, who in turn pay 75 percent of the fees they collect to the state governments in which the properties are located.
 
Here’s the language in the federal code, 33 USC 701c-3, “To compensate local taxing units for the loss of taxes from federally acquired lands, 75 percent of all monies received or deposited in the Treasury during and fiscal year for the account of leasing of lands acquired by the United States for flood control, navigation and allied purposes, including the development of hydroelectric power, are paid at the end of each year to the States in which such property is situated.”
 
Another section of the code further addresses how those funds are to be spent by the counties within the states, for items such as public schools, public roads and “defraying any of the expenses of county government in such county or counties, including public obligations of levee and drainage districts for flood control and drainage.”
 
“In other words, 75 percent of the funds that we pay to lease the property comes back to the county, by law, ‘to compensate local taxing units for the loss of taxes from federally acquired lands,’” Laidlaw explained. “It appeared as though the county did not recognize or give us credit for the concession fees and was looking to the marinas for additional tax revenue.”
 
While the Georgia Supreme Court decision on February 19 resulted in the values being set for tax years 2015-2017, the issue of how to tax marina property has yet to be decided for tax year 2018 and beyond. 

Posted online 2/26/18
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