hr900_LC_18_6406_a

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07 LC 18 6406

House Resolution 900

By: Representatives Richardson of the 19th, Keen of the 179th, Burkhalter of the 50th, O`Neal of the 146th, Fleming of the 117th, and others

A RESOLUTION

Proposing an amendment to the Constitution so as to provide for the comprehensive revision of provisions regarding taxation and finance and abolish most state and local taxes; to provide for a comprehensive flat tax to be known as the fair tax; to provide for procedures, conditions, and limitations; to provide for local revenue guarantee proceeds; to provide for applicability of prior tax provisions; to change certain provisions regarding certain defaulters; to change certain provisions regarding specific powers and limitations of powers of the General Assembly; to change certain provisions regarding other or supplementary appropriations; to change certain provisions regarding appropriations; to eliminate certain provisions regarding the motor fuel tax; to change certain provisions regarding firemen´s pension systems; to change certain provisions regarding special schools; to change certain provisions regarding educational assistance programs; to change certain provisions regarding revenue bond limitations; to eliminate and abolish the positions of tax commissioner, tax collector, or tax receiver; to change certain provisions regarding special districts; to change certain provisions regarding tax allocation bonds; to change certain provisions regarding enterprise zones; to eliminate community redevelopment tax incentive programs; to eliminate certain provisions regarding insurance premium taxes; to change certain provisions regarding tax allocation with respect to certain regional facilities; to change certain provisions regarding limitations on local debt; to change certain provisions regarding taxation power of counties and municipal governments; to change certain provisions regarding development authorities; to change certain provisions regarding community improvement districts; to provide for the submission of this amendment for ratification or rejection; and for other purposes.

BE IT RESOLVED BY THE GENERAL ASSEMBLY OF GEORGIA:

SECTION 1.

Article II, Section II of the Constitution is amended by revising Paragraph III as follows:

"Paragraph III. Persons not eligible to hold office. No person who is not a registered voter; who has been convicted of a felony involving moral turpitude, unless that person´s civil rights have been restored and at least ten years have elapsed from the date of the completion of the sentence without a subsequent conviction of another felony involving moral turpitude; who is a defaulter for any federal, or state, taxes or who is a defaulter of county, municipal, or school system taxes which became due and payable prior to January 1, 2009, required of such officeholder or candidate if such person has been finally adjudicated by a court of competent jurisdiction to owe those taxes, but such ineligibility may be removed at any time by full payment thereof, or by making payments to the tax authority pursuant to a payment plan, or under such other conditions as the General Assembly may provide by general law; or who is the holder of public funds illegally shall be eligible to hold any office or appointment of honor or trust in this state. Additional conditions of eligibility to hold office for persons elected on a write-in vote and for persons holding offices or appointments of honor or trust other than elected offices created by this Constitution may be provided by law."

SECTION 2.

Article III, Section VI of the Constitution is amended by revising Paragraph II as follows:

"Paragraph II. Specific powers. (a) Without limitation of the powers granted under Paragraph I, the General Assembly shall have the power to provide by law for:

(1) Restrictions upon land use in order to protect and preserve the natural resources, environment, and vital areas of this state.

(2) A militia and for the trial by courts-martial and nonjudicial punishment of its members, the discipline of whom, when not in federal service, shall be in accordance with law and the directives of the Governor acting as commander in chief.

(3) The participation by the state and political subdivisions and instrumentalities of the state in federal programs and the compliance with laws relating thereto, including but not limited to the powers, which may be exercised to the extent and in the manner necessary to effect such participation and compliance, to tax to the extent specifically authorized under this Constitution, to expend public money, to condemn property, and to zone property.

(4) The continuity of state and local governments in periods of emergency resulting from disasters caused by enemy attack including but not limited to the suspension of all constitutional legislative rules during such emergency.

(5) The participation by the state with any county, municipality, nonprofit organization, or any combination thereof in the operation of any of the facilities operated by such agencies for the purpose of encouraging and promoting tourism in this state.

(6) The control and regulation of outdoor advertising devices adjacent to federal aid interstate and primary highways and for the acquisition of property or interest therein for such purposes and may exercise the powers of taxation and provide for the expenditure of public funds in connection therewith.

(b) The General Assembly shall have the power to implement the provisions of Article I, Section III, Paragraph I(2.); Article IV, Section VIII, Paragraph II; Article IV, Section VIII, Paragraph III; and Article X, Section II, Paragraph XII of the Constitution of 1976 in force and effect on June 30, 1983; and all laws heretofore adopted thereunder and valid at the time of their enactment shall continue in force and effect until modified or repealed.

(c) The distribution of tractors, farm equipment, heavy equipment, new motor vehicles, and parts therefor in the State of Georgia vitally affects the general economy of the state and the public interest and public welfare. Notwithstanding the provisions of Article I, Section I, Paragraphs I, II, and III or Article III, Section VI, Paragraph V(c) of this Constitution, the General Assembly in the exercise of its police power shall be authorized to regulate tractor, farm equipment, heavy equipment, and new motor vehicle manufacturers, distributors, dealers, and their representatives doing business in Georgia, including agreements among such parties, in order to prevent frauds, unfair business practices, unfair methods of competition, impositions, and other abuses upon its citizens. Any law enacted by the General Assembly shall not impair the obligation of an existing contract but may apply with respect to the renewal of such a contract after the effective date of such law."

SECTION 3.

Article III, Section VI of the Constitution is amended by revising Paragraph V as follows:

"Paragraph V. Specific limitations. (a) The General Assembly shall not have the power to grant incorporation to private persons but shall provide by general law the manner in which private corporate powers and privileges may be granted.

(b) The General Assembly shall not forgive the forfeiture of the charter of any corporation existing on August 13, 1945, nor shall it grant any benefit to or permit any amendment to the charter of any corporation except upon the condition that the acceptance thereof shall operate as a novation of the charter and that such corporation shall thereafter hold its charter subject to the provisions of this Constitution.

(c) The General Assembly shall not have the power to authorize any contract or agreement which may have the effect of or which is intended to have the effect of defeating or lessening competition, or encouraging a monopoly, which are hereby declared to be unlawful and void.

(d) The General Assembly shall not have the power to regulate or fix charges of public utilities owned or operated by any county or municipality of this state, except as authorized by this Constitution.

(e) No municipal or county authority which is authorized to construct, improve, or maintain any road or street on behalf of, pursuant to a contract with, or through the use of taxes an allocation of the local revenue guarantee proceeds or other revenues of a county or municipal corporation shall be created by any local Act or pursuant to any general Act nor shall any law specifically relating to any such authority be amended unless the creation of such authority or the amendment of such law is conditioned upon the approval of a majority of the qualified voters of the county or municipal corporation affected voting in a referendum thereon. This subparagraph shall not apply to or affect any state authority."

SECTION 4.

Article III, Section IX of the Constitution is amended by revising Paragraph V as follows:

"Paragraph V. Other or supplementary appropriations. In addition to the appropriations made by the general appropriations Act and amendments thereto, the General Assembly may make additional appropriations by Acts, which shall be known as supplementary appropriation Acts, provided no such supplementary appropriation shall be available unless there is an unappropriated surplus in the state treasury or the revenue necessary to pay such appropriation shall have been provided by a tax laid for such purpose the fair tax under Article VII and collected into the general fund of the state treasury. Neither house shall pass a supplementary appropriation bill until the general appropriations Act shall have been finally adopted by both houses and approved by the Governor."

SECTION 5.

Article III, Section IX of the Constitution is amended by revising Paragraph VI as follows:

"Paragraph VI. Appropriations to be for specific sums. (a) Except as hereinafter provided, the appropriation for each department, officer, bureau, board, commission, agency, or institution for which appropriation is made shall be for a specific sum of money; and no appropriation shall allocate to any object the proceeds of any particular the fair tax or of any particular fund or a part or percentage thereof.

(b) An amount equal to all money derived from motor fuel taxes received by the state in each of the immediately preceding fiscal years, less the amount of refunds, rebates, and collection costs authorized by law, is hereby appropriated for the fiscal year beginning July 1, of each year following, for all activities incident to providing and maintaining an adequate system of public roads and bridges in this state, as authorized by laws enacted by the General Assembly of Georgia, and for grants to counties by law authorizing road construction and maintenance, as provided by law authorizing such grants. Said sum is hereby appropriated for, and shall be available for, the aforesaid purposes regardless of whether the General Assembly enacts a general appropriations Act; and said sum need not be specifically stated in any general appropriations Act passed by the General Assembly in order to be available for such purposes. However, this shall not preclude the General Assembly from appropriating for such purposes an amount greater than the sum specified above for such purposes. The expenditure of such funds shall be subject to all the rules, regulations, and restrictions imposed on the expenditure of appropriations by provisions of the Constitution and laws of this state, unless such provisions are in conflict with the provisions of this paragraph. And provided, however, that the proceeds of the tax hereby appropriated shall not be subject to budgetary reduction. In the event of invasion of this state by land, sea, or air or in case of a major catastrophe so proclaimed by the Governor, said funds may be utilized for defense or relief purposes on the executive order of the Governor.

(c)(b) A trust fund for use in the reimbursement of a portion of an employer´s workers´ compensation expenses resulting to an employee from the combination of a previous disability with subsequent injury incurred in employment may be provided for by law. As authorized by law, revenues raised for purposes of the fund may be paid into and disbursed from the trust without being subject to the limitations of subparagraph (a) of this Paragraph or of Article VII, Section III, Paragraph II.

(d)(c) As provided by law, additional penalties may be assessed in any case in which any court in this state imposes a fine or orders the forfeiture of any bond in the nature of the penalty for all offenses against the criminal and traffic laws of this state or of the political subdivisions of this state. The proceeds derived from such additional penalty assessments may be allocated for the specific purpose of meeting any and all costs, or any portion of the cost, of providing training to law enforcement officers and to prosecuting officials.

(e)(d) The General Assembly may by general law approved by a three-fifths´ vote of both houses designate any part or all of the proceeds of any state tax now or hereafter levied and collected on alcoholic beverages to be used for prevention, education, and treatment relating to alcohol and drug abuse.

(f)(e) The General Assembly is authorized to provide by law for the creation of a State Children´s Trust Fund from which funds shall be disbursed for child abuse and neglect prevention programs. The General Assembly is authorized to appropriate moneys to such fund and such moneys paid into the fund shall not be subject to the provisions of Article III, Section IX, Paragraph IV(c)(b), relative to the lapsing of funds.

(g)(f) The General Assembly is authorized to provide by law for the creation of a Seed-Capital Fund from which funds shall be disbursed at the direction of the Advanced Technology Development Center of the University System of Georgia to provide equity and other capital to small, young, entrepreneurial firms engaged in innovative work in the areas of technology, manufacturing, or agriculture. Funds shall be disbursed in the form of loans or investments which shall provide for repayment, rents, dividends, royalties, or other forms of return on investments as provided by law. Moneys received from returns on loans or investments shall be deposited in the Seed-Capital Fund for further disbursement. The General Assembly is authorized to appropriate moneys to such fund and such moneys paid into the fund shall not be subject to the provisions of Article III, Section IX, Paragraph IV(c)(b) relative to the lapsing of funds. The General Assembly shall be authorized to provide by law for any matters relating to the purpose or provisions of this subparagraph.

(h)(g) The General Assembly is authorized to provide by general law for additional penalties or fees in any case in any court in this state in which a person is adjudged guilty of an offense against the criminal or traffic laws of this state or an ordinance of a political subdivision of this state. The General Assembly is authorized to provide by general law for the allocation of such additional penalties or fees for the construction, operation, and staffing of jails, correctional institutions, and detention facilities by counties.

(i)(h) The General Assembly is authorized to provide by general law for the creation of an Indigent Care Trust Fund. Any hospital, hospital authority, county, or municipality is authorized to contribute or transfer moneys to the fund and any other person or entity specified by the General Assembly may also contribute to the fund. The General Assembly may provide by general law for the dedication and deposit of revenues raised from specified sources for the purposes of the fund into the fund. Moneys in the fund shall be exclusively used for primary health care programs for medically indigent citizens and children of this state, for expansion of Medicaid eligibility and services, or for programs to support rural and other health care providers, primarily hospitals, who disproportionately serve the medically indigent. Any other appropriation from the Indigent Care Trust Fund shall be void. Contributions and revenues deposited to the fund shall not lapse and shall not be subject to the limitations of subparagraph (a) of this Paragraph or of Article VII, Section III, Paragraph II. Contributions in the fund which are not appropriated as required by this subparagraph shall be refunded pro rata to the contributors thereof, as provided by the General Assembly.

(j)(i) The General Assembly is authorized to provide by general law for the creation of an emerging crops fund from which to pay interest on loans made to farmers to enable such farmers to produce certain crops on Georgia farms and thereby promote economic development. The General Assembly is authorized to appropriate moneys to such fund and moneys so appropriated shall not be subject to the provisions of Article III, Section IX, Paragraph IV(c)(b), relative to the lapsing of appropriated funds. Interest on loans made to farmers shall be paid from such fund pursuant to such terms, conditions, and requirements as the General Assembly shall provide by general law. The General Assembly may provide by general law for the administration of such fund by such state agency or public authority as the General Assembly shall determine.

(k)(j) The General Assembly is authorized to provide by general law for additional penalties or fees in any case in any court in this state in which a person is adjudged guilty of an offense involving driving under the influence of alcohol or drugs. The General Assembly is authorized to provide by general law for the allocation of such additional penalties or fees to the Brain and Spinal Injury Trust Fund, as provided by law, for the specified purpose of meeting any and all costs, or any portion of the costs, of providing care and rehabilitative services to citizens of the state who have survived neurotrauma with head or spinal cord injuries. Moneys appropriated for such purposes shall not lapse. The General Assembly may provide by general law for the administration of such fund by such authority as the General Assembly shall determine.

(l)(k) The General Assembly is authorized to provide by general law for the creation of a roadside enhancement and beautification fund from which funds shall be disbursed for enhancement and beautification of public rights of way; for allocation and dedication of revenue from tree and other vegetation trimming or removal permit fees, other related assessments, and special and distinctive wildflower motor vehicle license plate fees to such fund; that moneys paid into the fund shall not lapse, the provisions of Article III, Section IX, Paragraph IV(c)(b) notwithstanding; and for any matters relating to the purpose or provisions of this subparagraph. An Act creating such fund and making such provisions effective January 1, 1999, or later may originate or have originated in the Senate or the House of Representatives.

(m)(l) There shall be within the Department of Agriculture a dog and cat reproductive sterilization support program to control dog and cat overpopulation and thereby reduce the number of animals housed and killed in animal shelters, which program shall be administered by the Commissioner of Agriculture. In order to fund the program, there shall be issued beginning in 2003 specially designed license plates promoting the program. The General Assembly shall provide by law for the issuance of such license plates and for dedication of certain revenue derived from fees for such plates to the support of the program. All such dedicated revenue derived from special license plate fees, any funds appropriated to the department for such purposes, and any voluntary contributions or other funds made available to the department for such purposes and all interest thereon shall be deposited in a special fund for support of the program, shall not be used for any purpose other than support of the program, and shall not lapse. The General Assembly may provide by law for all matters necessary or appropriate to the implementation of this paragraph.

(n)(m) The General Assembly may provide by law for the issuance and renewal of special motor vehicle license plates that motor vehicle owners may optionally purchase and renew for additional fees. The General Assembly may provide for all or a portion of the net revenue, as defined by the General Assembly, derived from the additional fees charged for any such special license plate to be dedicated to an agency, fund, or nonprofit corporation to implement or support programs related to the nature of the special license plate, as intended by the authorizing statute. Any dedication of funds enacted pursuant to the authority of this subparagraph may be in whole or in part for the ultimate use of a nonprofit corporation, without limitation by Article III, Section VI, Paragraph VI, if the General Assembly determines that the license plate program and such appropriation will benefit both the state and the nonprofit corporation. Any law enacted pursuant to the authority of this subparagraph may provide that funds dedicated pursuant to such law shall not lapse as otherwise required by Article III, Section IX, Paragraph IV(c)(b). Any law enacted pursuant to the authority of this subparagraph shall be required to receive a two thirds´ majority vote in both the Senate and the House of Representatives."

SECTION 6.

Article III, Section X of the Constitution is amended by revising Paragraph IV as follows:

"Paragraph IV. Firemen´s Pension System. The powers of taxation may be exercised by the state through the General Assembly and the state proceeds of the fair tax and the local revenue guarantee proceeds of counties and municipalities may be expended for the purpose of paying pensions and other benefits and costs under a firemen´s pension system or systems. The taxes so levied Such proceeds may be collected by such firemen´s pension system or systems and disbursed therefrom by authority of the General Assembly for the purposes therein authorized."

SECTION 7.

The Constitution is amended by revising Article VII as follows:

"ARTICLE VII.
TAXATION AND FINANCE

SECTION 1.
POWER OF TAXATION

Paragraph I. Taxation; limitations on grants of tax powers. The state may not suspend or irrevocably give, grant, limit, or restrain the right of taxation and all laws, grants, contracts, and other acts to effect any of these purposes are null and void. Except as otherwise provided in this Constitution, the right of taxation shall always be under the complete control of the state.

Paragraph II. Taxing power limited. (a) The annual levy of state ad valorem taxes on tangible property for all purposes, except for defending the state in an emergency, shall not exceed one-fourth mill on each dollar of the assessed value of the property. On and after January 1, 2009, the following taxes are abolished and repealed and shall not be reenacted or reimposed:

(1) All state, county, municipal, school district, special district, or any other ad valorem taxes on real or personal property;

(2) All state and local sales taxes, use taxes, or sales and use taxes whether imposed pursuant to general law or local constitutional amendment;

(3) All motor fuel taxes;

(4) All unemployment and workers´ compensation taxes;

(5) All income taxes except as otherwise provided for in Paragraph III of this section;

(6) All gross receipts taxes;

(7) All insurance premium taxes;

(8) All estate taxes;

(9) All specific, business, and occupation taxes including but not limited to those taxes levied and collected pursuant to Chapter 13 of Title 48 of the Official Code of Georgia Annotated;

(10) All intangible taxes or other documentation and stock transfer taxes; and

(11) All utilities taxes.

(b) So long as the method of taxation in effect on December 31, 1980, for the taxation of shares of stock of banking corporations and other monied capital coming into competition with such banking corporations continues in effect, such shares and other monied capital may be taxed at an annual rate not exceeding five mills on each dollar of the assessed value of the property. A local revenue guarantee is established to provide that each local taxing jurisdiction shall not be impaired financially as a result of subparagraph (a) of this Paragraph. The local revenue guarantee will ensure that each local taxing jurisdiction receives an annual share of revenue essentially equivalent to the amount of revenue it received in the 2006 tax year from the taxes specified in subparagraph (a) of this Paragraph from which it received proceeds. The total revenue guarantee proceeds a local taxing jurisdiction shall be calculated by dividing the total local revenues in 2006 by the total state and local revenues in 2006. The resulting quotient shall be multiplied by the fair tax on personal income and business value added tax rates of 5.75 percent. The resulting product shall equal such jurisdiction´s share of local revenue guarantee proceeds.

(c) Each local taxing jurisdiction shall apply its local revenue guarantee proceeds to retire any outstanding public debt or bonds or obligations and may use its local revenue guarantee proceeds to secure or incur future debt or obligations.

Paragraph III. Uniformity; classification of property; assessment of agricultural land; utilities. (a) All taxes shall be levied and collected under general laws and for public purposes only. Except as otherwise provided in subparagraphs (b), (c), (d), and (e), all taxation shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax.

(b)(1) Except as otherwise provided in this subparagraph (b), classes of subjects for taxation of property shall consist of tangible property and one or more classes of intangible personal property including money; provided, however, that any taxation of intangible personal property may be repealed by general law without approval in a referendum effective for all taxable years beginning on or after January 1, 1996.

(2) Subject to the conditions and limitations specified by law, each of the following types of property may be classified as a separate class of property for ad valorem property tax purposes and different rates, methods, and assessment dates may be provided for such properties:

(A) Trailers.

(B) Mobile homes other than those mobile homes which qualify the owner of the home for a homestead exemption from ad valorem taxation.

(3) Motor vehicles may be classified as a separate class of property for ad valorem property tax purposes, and such class may be divided into separate subclasses for ad valorem purposes. The General Assembly may provide by general law for the ad valorem taxation of motor vehicles including, but not limited to, providing for different rates, methods, assessment dates, and taxpayer liability for such class and for each of its subclasses and need not provide for uniformity of taxation with other classes of property or between or within its subclasses. The General Assembly may also determine what portion of any ad valorem tax on motor vehicles shall be retained by the state. As used in this subparagraph, the term 'motor vehicles' means all vehicles which are self-propelled.

(c) Tangible real property, but no more than 2,000 acres of any single property owner, which is devoted to bona fide agricultural purposes shall be assessed for ad valorem taxation purposes at 75 percent of the value which other tangible real property is assessed. No property shall be entitled to receive the preferential assessment provided for in this subparagraph if the property which would otherwise receive such assessment would result in any person who has a beneficial interest in such property, including any interest in the nature of stock ownership, receiving the benefit of such preferential assessment as to more than 2,000 acres. No property shall be entitled to receive the preferential assessment provided for in this subparagraph unless the conditions set out below are met:

(1) The property must be owned by:

(A)(i) One or more natural or naturalized citizens;

(ii) An estate of which the devisee or heirs are one or more natural or naturalized citizens; or

(iii) A trust of which the beneficiaries are one or more natural or naturalized citizens; or

(B) A family-owned farm corporation, the controlling interest of which is owned by individuals related to each other within the fourth degree of civil reckoning, or which is owned by an estate of which the devisee or heirs are one or more natural or naturalized citizens, or which is owned by a trust of which the beneficiaries are one or more natural or naturalized citizens, and such corporation derived 80 percent or more of its gross income from bona fide agricultural pursuits within this state within the year immediately preceding the year in which eligibility is sought.

(2) The General Assembly shall provide by law:

(A) For a definition of the term 'bona fide agricultural purposes,' but such term shall include timber production;

(B) For additional minimum conditions of eligibility which such properties must meet in order to qualify for the preferential assessment provided for herein, including, but not limited to, the requirement that the owner be required to enter into a covenant with the appropriate taxing authorities to maintain the use of the properties in bona fide agricultural purposes for a period of not less than ten years and for appropriate penalties for the breach of any such covenant.

(3) In addition to the specific conditions set forth in this subparagraph (c), the General Assembly may place further restrictions upon, but may not relax, the conditions of eligibility for the preferential assessment provided for herein.

(d)(1) The General Assembly shall be authorized by general law to establish as a separate class of property for ad valorem tax purposes any tangible real property which is listed in the National Register of Historic Places or in a state historic register authorized by general law. For such purposes, the General Assembly is authorized by general law to establish a program by which certain properties within such class may be assessed for taxes at different rates or valuations in order to encourage the preservation of such historic properties and to assist in the revitalization of historic areas.

(2) The General Assembly shall be authorized by general law to establish as a separate class of property for ad valorem tax purposes any tangible real property on which there have been releases of hazardous waste, constituents, or substances into the environment. For such purposes, the General Assembly is authorized by general law to establish a program by which certain properties within such class may be assessed for taxes at different rates or valuations in order to encourage the cleanup, reuse, and redevelopment of such properties and to assist in the revitalization thereof by encouraging remedial action.

(e) The General Assembly shall provide by general law:

(1) For the definition and methods of assessment and taxation, such methods to include a formula based on current use, annual productivity, and real property sales data, of: 'bona fide conservation use property' to include bona fide agricultural and timber land not to exceed 2,000 acres of a single owner; and 'bona fide residential transitional property,' to include private single-family residential owner occupied property located in transitional developing areas not to exceed five acres of any single owner. Such methods of assessment and taxation shall be subject to the following conditions:

(A) A property owner desiring the benefit of such methods of assessment and taxation shall be required to enter into a covenant to continue the property in bona fide conservation use or bona fide residential transitional use; and

(B) A breach of such covenant within ten years shall result in a recapture of the tax savings resulting from such methods of assessment and taxation and may result in other appropriate penalties;

(2) That standing timber shall be assessed only once, and such assessment shall be made following its harvest or sale and on the basis of its fair market value at the time of harvest or sale. Said assessment shall be two and one-half times the assessed percentage of value fixed by law for other real property taxed under the uniformity provisions of subparagraph (a) of this Paragraph but in no event greater than its fair market value; and for a method of temporary supplementation of the property tax digest of any county if the implementation of this method of taxing timber reduces the tax digest by more than 20 percent, such supplemental assessed value to be assigned to the properties otherwise benefiting from such method of taxing timber.

(f) The General Assembly may provide for a different method and time of returns, assessments, payment, and collection of ad valorem taxes of public utilities, but not on a greater assessed percentage of value or at a higher rate of taxation than other properties, except that property provided for in subparagraph (c), (d), or (e). Fair tax. (a) The General Assembly shall provide by general law for a comprehensive flat tax which shall be known as the fair tax. Such tax shall replace the state income tax laws of this state and shall consist of a personal income tax at the initial rate of 5.75 percent and a business value added tax at the initial rate of 5.75 percent. Such initial tax rates may be increased or reduced as determined by general law.

(b) The fair tax for individuals other than independent contractors shall include taxable income from all sources. Exclusions from such tax shall only include charitable contributions; mortgage interest; social security benefits, unemployment benefits, and other designated tax-exempt benefits; and rental payments with respect for primary shelter. The resulting income after exclusions shall be multiplied by 5.75 percent.

(c) The fair tax for independent contractors possessing a taxpayer identification number shall include taxable income from the total dollar value of sales, including, but not limited to, personal services, but excluding purchases from other businesses and independent contractors possessing taxpayer identification numbers of items used exclusively to generate sales and revenues; purchases from other businesses and independent contractors possessing taxpayer identification numbers of imported goods or services used exclusively to generate sales and revenues; and depreciation of pre-flat tax rate depreciable assets at their regular depreciation schedules. The same exclusions from such tax as specified in subparagraph (b) of this Paragraph shall also apply with respect to this subparagraph. The resulting income after exclusions shall be multiplied by 5.75 percent.

(d) The fair tax for business value added for all entities possessing a taxpayer identification number, including independent contractors, shall be the total dollar value of all sales during the year less all purchases from entities that possess a taxpayer identification number including independent contractors; all purchases from entities that possess a taxpayer identification number of imported goods; depreciation of pre-flat tax rate depreciable assets at their regular depreciation schedules; bad debts incurred; and charitable contributions. The resulting income after exclusions shall be multiplied by 5.75 percent.

SECTION II.
EXEMPTIONS FROM AD VALOREM TAXATION

Paragraph I. Unauthorized tax exemptions void. Except as authorized in or pursuant to this Constitution, all laws exempting property from ad valorem taxation are void.

Paragraph II. Exemptions from taxation of property. (a) (1) Except as otherwise provided in this Constitution, no property shall be exempted from ad valorem taxation unless the exemption is approved by two-thirds of the members elected to each branch of the General Assembly in a roll-call vote and by a majority of the qualified electors of the state voting in a referendum thereon.

(2) Homestead exemptions from ad valorem taxation levied by local taxing jurisdictions may be granted by local law conditioned upon approval by a majority of the qualified electors residing within the limits of the local taxing jurisdiction voting in a referendum thereon.

(3) Laws subject to the requirement of a referendum as provided in this subparagraph (a) may originate in either the Senate or the House of Representatives.

(4) The requirements of this subparagraph (a) shall not apply with respect to a law which codifies or recodifies an exemption previously authorized in the Constitution of 1976 or an exemption authorized pursuant to this Constitution.

(b) The grant of any exemption from ad valorem taxation shall be subject to the conditions, limitations, and administrative procedures specified by law.

Paragraph III. Exemptions which may be authorized locally. (a) (1) The governing authority of any county or municipality, subject to the approval of a majority of the qualified electors of such political subdivision voting in a referendum thereon, may exempt from ad valorem taxation, including all such taxation levied for educational purposes and for state purposes, inventories of goods in the process of manufacture or production, and inventories of finished goods.

(2) Exemptions granted pursuant to this subparagraph (a) may only be revoked by a referendum election called and conducted as provided by law. The call for such referendum shall not be issued within five years from the date such exemptions were first granted and, if the results of the election are in favor of the revocation of such exemptions, then such revocation shall be effective only at the end of a five-year period from the date of such referendum.

(3) The implementation, administration, and revocation of the exemptions authorized in this subparagraph (a) shall be provided for by law. Until otherwise provided by law, the grant of the exemption shall be subject to the same conditions, limitations, definitions, and procedures provided for the grant of such exemption in the Constitution of 1976 on June 30, 1983.

(b) Repealed.

Paragraph IV. Current property tax exemptions preserved. Those types of exemptions from ad valorem taxation provided for by law on June 30, 1983, are hereby continued in effect as statutory law until otherwise provided for by law. Any law which reduces or repeals any homestead exemption in existence on June 30, 1983, or created thereafter must be approved by two-thirds of the members elected to each branch of the General Assembly in a roll-call vote and by a majority of the qualified electors of the state or the affected local taxing jurisdiction voting in a referendum thereon. Any law which reduces or repeals exemptions granted to religious or burial grounds or institutions of purely public charity must be approved by two-thirds of the members elected to each branch of the General Assembly.

Paragraph V. Disabled veteran´s homestead exemption. Except as otherwise provided in this paragraph, the amount of the homestead exemption granted to disabled veterans shall be the greater of $32,500.00 or the maximum amount which may be granted to a disabled veteran under Section 802 of Title 38 of the United States Code as hereafter amended. Such exemption shall be granted to: those persons eligible for such exemption on June 30, 1983; to disabled American veterans of any war or armed conflict who are disabled due to loss or loss of use of one lower extremity together with the loss or loss of use of one upper extremity which so affects the functions of balance or propulsion as to preclude locomotion without the aid of braces, crutches, canes, or a wheelchair; and to disabled veterans hereafter becoming eligible for assistance in acquiring housing under Section 801 of the United States Code as hereafter amended. The General Assembly may by general law provide for a different amount or a different method of determining the amount of or eligibility for the homestead exemption granted to disabled veterans. Any such law shall be enacted by a simple majority of the votes of all the members to which each house is entitled and may become effective without referendum. Such law may provide that the amount of or eligibility for the exemption shall be determined by reference to laws enacted by the United States Congress.

SECTION II.
PRIOR TAX LAWS

Paragraph I. Applicability. State and local tax, penalty, and interest liabilities and refund eligibility for tax years on periods prior to January 1, 2009, shall be governed by the provisions of this Constitution and general laws as they existed immediately prior to January 1, 2009.

Paragraph II. Exemptions from taxation of property. All state and local exemptions from ad valorem taxation of real or personal property are hereby repealed.

SECTION IIA.
HOMEOWNER´S INCENTIVE ADJUSTMENT

Paragraph I. State grants; adjustment amount. For each taxable year, a homeowner´s incentive adjustment may be applied to the return of each taxpayer claiming such state-wide homestead exemption as may be specified by general law. The amount of such adjustment may provide a taxpayer with a benefit equivalent to a homestead exemption of up to $18,000.00 of the assessed value of a taxpayer´s homestead or the taxpayer´s ad valorem property tax liability on the homestead, whichever is lower. The General Assembly may appropriate such amount each year for grants to local governments and school districts as homeowner tax relief grants. The adjustments and grants authorized by this Paragraph shall be made in such manner and shall be subject to the procedures and conditions as may be specified by general law heretofore or hereafter enacted.

SECTION III.
PURPOSES AND METHOD OF STATE TAXATION

Paragraph I. Taxation; purposes for which powers may be exercised. (a) Except as otherwise provided in this Constitution, the power of taxation over the whole state may be exercised for any purpose authorized by general law. Any purpose for which the powers of taxation over the whole state could have been exercised on June 30, 1983, shall continue to be a purpose for which such powers may be exercised.

(b) Subject to conditions and limitations as may be provided by law, the power of taxation may be exercised to make grants for tax relief purposes to persons for sales tax paid and not otherwise reimbursed on prescription drugs. Credits or relief provided hereunder may be limited only to such reasonable classifications of taxpayers as may be specified by law.

Paragraph II. Revenue to be paid into general fund. (a) Except as otherwise provided in this Constitution, all revenue collected from taxes, fees, and assessments for state purposes, as authorized by revenue measures enacted by the General Assembly, shall be paid into the general fund of the state treasury.

(b)(1) As authorized by law providing for the promotion of any one or more types of agricultural products, fees, assessments, and other charges collected on the sale or processing of agricultural products need not be paid into the general fund of the state treasury. The uniformity requirement of this article shall be satisfied by the application of the agricultural promotion program upon the affected products.

(2) As used in this subparagraph, 'agricultural products' includes, but is not limited to, registered livestock and livestock products, poultry and poultry products, timber and timber products, fish and seafood, and the products of the farms and forests of this state.

Paragraph III. Grants to counties and municipalities. State funds may be granted to counties and municipalities within the state. The grants authorized by this Paragraph shall be made in such manner and form and subject to the procedures and conditions specified by law. The law providing for any such grant may limit the purposes for which the grant funds may be expended.

SECTION IV.
STATE DEBT

Paragraph I. Purposes for which debt may be incurred. The state may incur:

(a) Public debt without limit to repel invasion, suppress insurrection, and defend the state in time of war.

(b) Public debt to supply a temporary deficit in the state treasury in any fiscal year created by a delay in collecting the taxes of that year. Such debt shall not exceed, in the aggregate, 5 percent of the total revenue receipts, less refunds, of the state treasury in the fiscal year immediately preceding the year in which such debt is incurred. The debt incurred shall be repaid on or before the last day of the fiscal year in which it is incurred out of taxes levied for that fiscal year. No such debt may be incurred in any fiscal year under the provisions of this subparagraph (b) if there is then outstanding unpaid debt from any previous fiscal year which was incurred to supply a temporary deficit in the state treasury.

(c) General obligation debt to acquire, construct, develop, extend, enlarge, or improve land, waters, property, highways, buildings, structures, equipment, or facilities of the state, its agencies, departments, institutions, and of those state authorities which were created and activated prior to November 8, 1960.

(d) General obligation debt to provide educational facilities for county and independent school systems and to provide public library facilities for county and independent school systems, counties, municipalities, and boards of trustees of public libraries or boards of trustees of public library systems, and, when the construction of such educational or library facilities has been completed, the title to such facilities shall be vested in the respective local boards of education, counties, municipalities, or public library boards of trustees for which such facilities were constructed.

(e) General obligation debt in order to make loans to counties, municipal corporations, political subdivisions, local authorities, and other local government entities for water or sewerage facilities or systems or for regional or multijurisdictional solid waste recycling or solid waste facilities or systems. It shall not be necessary for the state or a state authority to hold title to or otherwise be the owner of such facilities or systems. General obligation debt for these purposes may be authorized and incurred for administration and disbursement by a state authority created and activated before, on, or after November 8, 1960.

(f) Guaranteed revenue debt by guaranteeing the payment of revenue obligations issued by an instrumentality of the state if such revenue obligations are issued to finance:

(1) Toll bridges or toll roads.

(2) Land public transportation facilities or systems.

(3) Water facilities or systems.

(4) Sewage facilities or systems.

(5) Loans to, and loan programs for, citizens of the state for educational purposes.

(6) Regional or multijurisdictional solid waste recycling or solid waste facilities or systems.

Paragraph II. State general obligation debt and guaranteed revenue debt; limitations. (a) As used in this Paragraph and Paragraph III of this section, 'annual debt service requirements' means the total principal and interest coming due in any state fiscal year. With regard to any issue of debt incurred wholly or in part on a term basis, 'annual debt service requirements' means an amount equal to the total principal and interest payments required to retire such issue in full divided by the number of years from its issue date to its maturity date.

(b) No debt may be incurred under subparagraphs (c), (d), and (e) of Paragraph I of this section or Paragraph V of this section at any time when the highest aggregate annual debt service requirements for the then current year or any subsequent year for outstanding general obligation debt and guaranteed revenue debt, including the proposed debt, and the highest aggregate annual payments for the then current year or any subsequent fiscal year of the state under all contracts then in force to which the provisions of the second paragraph of Article IX, Section VI, Paragraph I(a) of the Constitution of 1976 are applicable, exceed 10 percent of the total revenue receipts, less refunds of the state treasury in the fiscal year immediately preceding the year in which any such debt is to be incurred.

(c) No debt may be incurred under subparagraphs (c) and (d) of Paragraph I of this section at any time when the term of the debt is in excess of 25 years.

(d) No guaranteed revenue debt may be incurred to finance water or sewage treatment facilities or systems when the highest aggregate annual debt service requirements for the then current year or any subsequent fiscal year of the state for outstanding or proposed guaranteed revenue debt for water facilities or systems or sewage facilities or systems exceed 1 percent of the total revenue receipts less refunds, of the state treasury in the fiscal year immediately preceding the year in which any such debt is to be incurred.

(e) The aggregate amount of guaranteed revenue debt incurred to make loans for educational purposes that may be outstanding at any time shall not exceed $18 million, and the aggregate amount of guaranteed revenue debt incurred to purchase, or to lend or deposit against the security of, loans for educational purposes that may be outstanding at any time shall not exceed $72 million.

Paragraph III. State general obligation debt and guaranteed revenue debt; conditions upon issuance; sinking funds and reserve funds. (a) (1) General obligation debt may not be incurred until legislation is enacted stating the purposes, in general or specific terms, for which such issue of debt is to be incurred, specifying the maximum principal amount of such issue and appropriating an amount at least sufficient to pay the highest annual debt service requirements for such issue. All such appropriations for debt service purposes shall not lapse for any reason and shall continue in effect until the debt for which such appropriation was authorized shall have been incurred, but the General Assembly may repeal any such appropriation at any time prior to the incurring of such debt. The General Assembly shall raise by taxation and appropriate each fiscal year, in addition to the sum necessary to make all payments required under contracts entitled to the protection of the second paragraph of Paragraph I(a), Section VI, Article IX of the Constitution of 1976, such amounts as are necessary to pay debt service requirements in such fiscal year on all general obligation debt.

(2)(A) The General Assembly shall appropriate to a special trust fund to be designated 'State of Georgia General Obligation Debt Sinking Fund' such amounts as are necessary to pay annual debt service requirements on all general obligation debt. The sinking fund shall be used solely for the retirement of general obligation debt payable from the fund. If for any reason the monies in the sinking fund are insufficient to make, when due, all payments required with respect to such general obligation debt, the first revenues thereafter received in the general fund of the state shall be set aside by the appropriate state fiscal officer to the extent necessary to cure the deficiency and shall be deposited by the fiscal officer into the sinking fund. The appropriate state fiscal officer may be required to set aside and apply such revenues at the suit of any holder of any general obligation debt incurred under this section.

(B) The obligation to make sinking fund deposits as provided in subparagraph (2)(A) shall be subordinate to the obligation imposed upon the fiscal officers of the state pursuant to the provisions of the second paragraph of Paragraph I(a) of Section VI of Article IX of the Constitution of 1976.

(b)(1) Guaranteed revenue debt may not be incurred until legislation has been enacted authorizing the guarantee of the specific issue of revenue obligations then proposed, reciting that the General Assembly has determined such obligations will be self-liquidating over the life of the issue (which determination shall be conclusive), specifying the maximum principal amount of such issue and appropriating an amount at least equal to the highest annual debt service requirements for such issue.

(2)(A) Each appropriation made for the purposes of subparagraph (b)(1) shall be paid upon the issuance of said obligations into a special trust fund to be designated 'State of Georgia Guaranteed Revenue Debt Common Reserve Fund' to be held together with all other sums similarly appropriated as a common reserve for any payments which may be required by virtue of any guarantee entered into in connection with any issue of guaranteed revenue obligations. No appropriations for the benefit of guaranteed revenue debt shall lapse unless repealed prior to the payment of the appropriation into the common reserve fund.

(B) If any payments are required to be made from the common reserve fund to meet debt service requirements on guaranteed revenue obligations by virtue of an insufficiency of revenues, the amount necessary to cure the deficiency shall be paid from the common reserve fund by the appropriate state fiscal officer. Upon any such payment, the common reserve fund shall be reimbursed from the general funds of the state within ten days following the commencement of any fiscal year of the state for any amounts so paid; provided, however, the obligation to make any such reimbursements shall be subordinate to the obligation imposed upon the fiscal officers of the state pursuant to the second paragraph of Paragraph I(a) of Section VI, Article IX of the Constitution of 1976 and shall also be subordinate to the obligation to make sinking fund deposits for the benefit of general obligation debt. The appropriate state fiscal officer may be required to apply such funds as provided in this subparagraph (b)(2)(B) at the suit of any holder of any such guaranteed revenue obligations.

(C) The amount to the credit of the common reserve fund shall at all times be at least equal to the aggregate highest annual debt service requirements on all outstanding guaranteed revenue obligations entitled to the benefit of the fund. If at the end of any fiscal year of the state the fund is in excess of the required amount, the appropriate state fiscal officer, as designated by law, shall transfer the excess amount to the general funds of the state free of said trust.

(c) The funds in the general obligation debt sinking fund and the guaranteed revenue debt common reserve fund shall be as fully invested as is practicable, consistent with the requirements to make current principal and interest payments. Any such investments shall be restricted to obligations constituting direct and general obligations of the United States government or obligations unconditionally guaranteed as to the payment of principal and interest by the United States government, maturing no longer than 12 months from date of purchase.

Paragraph IV. Certain contracts prohibited. The state, and all state institutions, departments and agencies of the state are prohibited from entering into any contract, except contracts pertaining to guaranteed revenue debt, with any public agency, public corporation, authority, or similar entity if such contract is intended to constitute security for bonds or other obligations issued by any such public agency, public corporation, or authority and, in the event any contract between the state, or any state institution, department or agency of the state and any public agency, public corporation, authority or similar entity, or any revenues from any such contract, is pledged or assigned as security for the repayment of bonds or other obligations, then and in either such event, the appropriation or expenditure of any funds of the state for the payment of obligations under any such contract shall likewise be prohibited.

Paragraph V. Refunding of debt. The state may incur general obligation debt or guaranteed revenue debt to fund or refund any such debt or to fund or refund any obligations issued upon the security of contracts to which the provisions of the second paragraph of Paragraph I(a), Section VI, Article IX of the Constitution of 1976 are applicable. The issuance of any such debt for the purposes of said funding or refunding shall be subject to the 10 percent limitation in Paragraph II(b) of this section to the same extent as debt incurred under Paragraph I of this section; provided, however, in making such computation the annual debt service requirements and annual contract payments remaining on the debt or obligations being funded or refunded shall not be taken into account. The issuance of such debt may be accomplished by resolution of the Georgia State Financing and Investment Commission without any action on the part of the General Assembly and any appropriation made or required to be made with respect to the debt or obligation being funded or refunded shall immediately attach and inure to the benefit of the obligations to be issued in connection with such funding or refunding Debt incurred in connection with any such funding or refunding shall be the same as that originally authorized by the General Assembly, except that general obligation debt may be incurred to fund or refund obligations issued upon the security of contracts to which the provisions of the second paragraph of Paragraph I(a), Section VI, Article IX of the Constitution of 1976 are applicable and the continuing appropriations required to be made under this Constitution shall immediately attach and inure to the benefit of the obligation to be issued in connection with such funding or refunding with the same force and effect as though said obligations so funded or refunded had originally been issued as a general obligation debt authorized hereunder. The term of a funding or refunding issue pursuant to this Paragraph shall not extend beyond the term of the original debt or obligation and the total interest on the funding or refunding issue shall not exceed the total interest to be paid on such original debt or obligation. The principal amount of any debt issued in connection with such funding or refunding may exceed the principal amount being funded or refunded to the extent necessary to provide for the payment of any premium thereby incurred.

Paragraph VI. Faith and credit of state pledged debt may be validated. The full faith, credit, and taxing power of the state are hereby pledged to the payment of all public debt incurred under this article and all such debt and the interest on the debt shall be exempt from taxation. Such debt may be validated by judicial proceedings in the manner provided by law. Such validation shall be incontestable and conclusive.

Paragraph VII. Georgia State Financing and Investment Commission; duties. (a) There shall be a Georgia State Financing and Investment Commission. The commission shall consist of the Governor, the President of the Senate, the Speaker of the House of Representatives, the State Auditor, the Attorney General, the director, Fiscal Division, Department of Administrative Services, or such other officer as may be designated by law, and the Commissioner of Agriculture. The commission shall be responsible for the issuance of all public debt and for the proper application, as provided by law, of the proceeds of such debt to the purposes for which it is incurred; provided, however, the proceeds from guaranteed revenue obligations shall be paid to the issuer thereof and such proceeds and the application thereof shall be the responsibility of such issuer. Debt to be incurred at the same time for more than one purpose may be combined in one issue without stating the purpose separately but the proceeds thereof must be allocated, disbursed and used solely in accordance with the original purpose and without exceeding the principal amount authorized for each purpose set forth in the authorization of the General Assembly and to the extent not so used shall be used to purchase and retire public debt. The commission shall be responsible for the investment of all proceeds to be administered by it and, as provided by law, the income earned on any such investments may be used to pay operating expenses of the commission or placed in a common debt retirement fund and used to purchase and retire any public debt, or any bonds or obligations issued by any public agency, public corporation or authority which are secured by a contract to which the provisions of the second paragraph of Paragraph I(a) of Section VI, Article IX of the Constitution of 1976 are applicable. The commission shall have such additional responsibilities, powers, and duties as are provided by law.

(b) Notwithstanding subparagraph (a) of this Paragraph, proceeds from general obligation debt issued for making loans to local government entities for water or sewerage facilities or systems or for regional or multijurisdictional solid waste recycling or solid waste facilities or systems as provided in Paragraph I(e) of this section shall be paid or transferred to and administered and invested by the unit of state government or state authority made responsible by law for such activities, and the proceeds and investment earnings thereof shall be applied and disbursed by such unit or authority.

Paragraph VIII. State aid forbidden. Except as provided in this Constitution, the credit of the state shall not be pledged or loaned to any individual, company, corporation, or association. The state shall not become a joint owner or stockholder in or with any individual, company, association, or corporation.

Paragraph IX. Construction. Paragraphs I through VIII of this section are for the purpose of providing an effective method of financing the state´s needs and their provisions and any law now or hereafter enacted by the General Assembly in furtherance of their provisions shall be liberally construed to effect such purpose. Insofar as any such provisions or any such law may be inconsistent with any other provisions of this Constitution or of any other law, the provisions of such Paragraphs and laws enacted in furtherance of such Paragraphs shall be controlling; provided, however, the provisions of such Paragraphs shall not be so broadly construed as to cause the same to be unconstitutional and in connection with any such construction such Paragraphs shall be deemed to contain such implied limitations as shall be required to accomplish the foregoing.

Paragraph X. Assumption of debts forbidden; exceptions. The state shall not assume the debt, or any part thereof, of any county, municipality, or other political subdivision of the state, unless such debt be contracted to enable the state to repel invasion, suppress civil disorders or insurrection, or defend itself in time of war and except as may be otherwise required under Paragraph III of Section I of this article.

Paragraph XI. Section not to unlawfully impair contracts or revive obligations previously voided. The provisions of this section shall not be construed so as to:

(a) Unlawfully impair the obligation of any contract in effect on June 30, 1983.

(b) Revive or permit the revival of the obligation of any bond or security declared to be void by the Constitution of 1976 or any previous Constitution of this state."

SECTION 8.

Article VIII, Section V of the Constitution amended by revising Paragraph VII as follows:

"Paragraph VII. Special schools. (a) The General Assembly may provide by law for the creation of special schools in such areas as may require them and may provide for the participation of local boards of education in the establishment of such schools under such terms and conditions as it may provide; but no bonded indebtedness may be incurred nor a school tax levied for the support of special schools without the approval of a majority of the qualified voters voting thereon in each of the systems affected. Any special schools shall be operated in conformity with regulations of the State Board of Education pursuant to provisions of law. The state is authorized to shall expend funds for the support and maintenance of special schools in such amount and manner as may be provided by general law.

(b) Nothing contained herein shall be construed to affect the authority of local boards of education or of the state to support and maintain special schools created prior to June 30, 1983."

SECTION 9.

Article VIII is amended by revising Section VI as follows:

"SECTION VI.
RESERVED
LOCAL TAXATION FOR EDUCATION

Paragraph I. Local taxation for education. (a) The board of education of each school system shall annually certify to its fiscal authority or authorities a school tax not greater than 20 mills per dollar for the support and maintenance of education. Said fiscal authority or authorities shall annually levy said tax upon the assessed value of all taxable property within the territory served by said school system, provided that the levy made by an area board of education, which levy shall not be greater than 20 mills per dollar, shall be in such amount and within such limits as may be prescribed by local law applicable thereto.

(b) School tax funds shall be expended only for the support and maintenance of public schools, public vocational-technical schools, public education, and activities necessary or incidental thereto, including school lunch purposes.

(c) The 20 mill limitation provided for in subparagraph (a) of this Paragraph shall not apply to those school systems which are authorized on June 30, 1983, to levy a school tax in excess thereof.

(d) The method of certification and levy of the school tax provided for in subparagraph (a) of this Paragraph shall not apply to those systems that are authorized on June 30, 1983, to utilize a different method of certification and levy of such tax; but the General Assembly may by law require that such systems be brought into conformity with the method of certification and levy herein provided.

Paragraph II. Increasing or removing tax rate. The mill limitation in effect on June 30, 1983, for any school system may be increased or removed by action of the respective boards of education, but only after such action has been approved by a majority of the qualified voters voting thereon in the particular school system to be affected in the manner provided by law.

Paragraph III. School tax collection reimbursement. The General Assembly may by general law require local boards of education to reimburse the appropriate governing authority for the collection of school taxes, provided that any rate established may be reduced by local act.

Paragraph IV. Sales tax for educational purposes. (a) The board of education of each school district in a county in which no independent school district is located may by resolution and the board of education of each county school district and the board of education of each independent school district located within such county may by concurrent resolutions impose, levy, and collect a sales and use tax for educational purposes of such school districts conditioned upon approval by a majority of the qualified voters residing within the limits of the local taxing jurisdiction voting in a referendum thereon. This tax shall be at the rate of 1 percent and shall be imposed for a period of time not to exceed five years, but in all other respects, except as otherwise provided in this Paragraph, shall correspond to and be levied in the same manner as the tax provided for by Article 3 of Chapter 8 of Title 48 of the Official Code of Georgia Annotated, relating to the special county 1 percent sales and use tax, as now or hereafter amended. Proceedings for the reimposition of such tax shall be in the same manner as proceedings for the initial imposition of the tax, but the newly authorized tax shall not be imposed until the expiration of the tax then in effect.

(b) The purpose or purposes for which the proceeds of the tax are to be used and may be expended include:

(1) Capital outlay projects for educational purposes;

(2) The retirement of previously incurred general obligation debt with respect only to capital outlay projects of the school system; provided, however, that the tax authorized under this Paragraph shall only be expended for the purpose authorized under this subparagraph (b)(2) if all ad valorem property taxes levied or scheduled to be levied prior to the maturity of any such then outstanding general obligation debt to be retired by the proceeds of the tax imposed under this Paragraph shall be reduced by a total amount equal to the total amount of proceeds of the tax imposed under this Paragraph to be applied to retire such bonded indebtedness. In the event of failure to comply with the requirements of this subparagraph (b)(2), as certified by the Department of Revenue, no further funds shall be expended under this subparagraph (b)(2) by such county or independent board of education and all such funds shall be maintained in a separate, restricted account and held solely for the expenditure for future capital outlay projects for educational purposes; or

(3) A combination of the foregoing.

(1) The specific capital outlay projects to be funded, or the specific debt to be retired, or both, if applicable;

(2) The maximum cost of such project or projects and, if applicable, the maximum amount of debt to be retired, which cost and amount of debt shall also be the maximum amount of net proceeds to be raised by the tax; and

(3) The maximum period of time, to be stated in calendar years or calendar quarters and not to exceed five years.

(d) Nothing in this Paragraph shall prohibit a county and those municipalities located in such county from imposing as additional taxes local sales and use taxes authorized by general law.

(e) The tax imposed pursuant to this Paragraph shall not be subject to and shall not count with respect to any general law limitation regarding the maximum amount of local sales and use taxes which may be levied in any jurisdiction in this state.

(f) The tax imposed pursuant to this Paragraph shall not be subject to any sales and use tax exemption with respect to the sale or use of food and beverages which is imposed by law.

(g) The net proceeds of the tax shall be distributed between the county school district and the independent school districts, or portion thereof, located in such county according to the ratio the student enrollment in each school district, or portion thereof, bears to the total student enrollment of all school districts in the county or upon such other formula for distribution as may be authorized by local law. For purposes of this subparagraph, student enrollment shall be based on the latest FTE count prior to the referendum on imposing the tax.

(h) Excess proceeds of the tax which remain following expenditure of proceeds for authorized projects or purposes for education shall be used solely for the purpose of reducing any indebtedness of the school system. In the event there is no indebtedness, such excess proceeds shall be used by such school system for the purpose of reducing its millage rate in an amount equivalent to the amount of such excess proceeds.

(i) The tax authorized by this Paragraph may be imposed, levied, and collected as provided in this Paragraph without further action by the General Assembly, but the General Assembly shall be authorized by general law to further define and implement its provisions including, but not limited to, the authority to specify the percentage of net proceeds to be allocated among the projects and purposes for which the tax was levied.

(j)(1) Notwithstanding any provision of any constitutional amendment continued in force and effect pursuant to Article XI, Section I, Paragraph IV(a) and except as otherwise provided in subparagraph (j)(2) of this Paragraph, any political subdivision whose ad valorem taxing powers are restricted pursuant to such a constitutional amendment may receive the proceeds of the tax authorized under this Paragraph or of any local sales and use tax authorized by general law, or any combination of such taxes, without any corresponding limitation of its ad valorem taxing powers which would otherwise be required under such constitutional amendment.

(2) The restriction on and limitation of ad valorem taxing powers described in subparagraph (j)(1) of this Paragraph shall remain applicable with respect to proceeds received from the levy of a local sales and use tax specifically authorized by a constitutional amendment in force and effect pursuant to Article XI, Section I, Paragraph IV(a), as opposed to a local sales and use tax authorized by this Paragraph or by general law."

SECTION 10.

Article VIII, Section VII of the Constitution is amended by revising Paragraph I as follows:

"Paragraph I. Educational assistance programs authorized. (a) Pursuant to laws now or hereafter enacted by the General Assembly, public funds may be expended for any of the following purposes:

(1) To provide grants, scholarships, loans, or other assistance to students and to parents of students for educational purposes.

(2) To provide for a program of guaranteed loans to students and to parents of students for educational purposes and to pay interest, interest subsidies, and fees to lenders on such loans. The General Assembly is authorized to provide such tax exemptions to lenders as shall be deemed advisable in connection with such program.

(3) To match funds now or hereafter available for student assistance pursuant to any federal law.

(4) To provide grants, scholarships, loans, or other assistance to public employees for educational purposes.

(5) To provide for the purchase of loans made to students for educational purposes who have completed a program of study in a field in which critical shortages exist and for cancellation of repayment of such loans, interest, and charges thereon.

(b) Contributions made in support of any educational assistance program now or hereafter established under provisions of this section may be deductible for state income tax purposes as now or hereafter provided by law.

(c)(b) The General Assembly shall be authorized by general law to provide for an education trust fund to assist students and parents of students in financing postsecondary education and to provide for contracts between the fund and purchasers for the advance payment of tuition by each purchaser for a qualified beneficiary to attend a state institution of higher education. Such general law shall provide for such terms, conditions, and limitations as the General Assembly shall deem necessary for the implementation of this subparagraph. Notwithstanding any provision of this Constitution to the contrary, the General Assembly shall be authorized to provide for the guarantee of such contracts with state revenues."

SECTION 11.

Article IX, Section I of the Constitution is amended by revising Paragraph III as follows:

"Paragraph III. County officers; election; term; compensation. (a) The clerk of the superior court, judge of the probate court, and sheriff, tax receiver, tax collector, and tax commissioner, where such office has replaced the tax receiver and tax collector, shall be elected by the qualified voters of their respective counties for terms of four years and shall have such qualifications, powers, and duties as provided by general law.

(b) County officers listed in subparagraph (a) of this Paragraph may be on a fee basis, salary basis, or fee basis supplemented by salary, in such manner as may be directed by law. Minimum compensation for said county officers may be established by the General Assembly by general law. Such minimum compensation may be supplemented by local law or, if such authority is delegated by local law, by action of the county governing authority.

(c) The General Assembly may consolidate the offices of tax receiver, and tax collector, and into the office of tax commissioner are abolished effective January 1, 2009. Any person serving as tax receiver, tax collector, or tax commissioner shall cease to serve as such at the last moment of December 31, 2008, and no person shall be appointed, selected, or elected to such position on or after January 1, 2009."

SECTION 12.

Article IX, Section II of the Constitution is amended by revising Paragraph VI as follows:

"Paragraph VI. Special districts. As hereinafter provided in this Paragraph, special districts may be created for the provision of local government services within such districts; and fees, or assessments, and taxes which are authorized by general law may be levied and collected within such districts to pay, wholly or partially, the cost of providing such services therein and to construct and maintain facilities therefor. Such special districts may be created and fees, or assessments, or taxes which are authorized by general law may be levied and collected therein by any one or more of the following methods:

(a) By general law which directly creates the districts;

(b) By general law which requires the creation of districts under conditions specified by such general law; and

(c) By municipal or county ordinance or resolution, except that no such ordinance or resolution may supersede a law enacted by the General Assembly pursuant to subparagraphs (a) or (b) of this Paragraph."

SECTION 13.

Article IX, Section II of the Constitution is amended by revising Paragraph VII as follows:

"Paragraph VII. Community redevelopment. (a) Each condemnation of privately held property for redevelopment purposes must be approved by vote of the elected governing authority of the city within which the property is located, if any, or otherwise by the governing authority of the county within which the property is located. The power of eminent domain shall not be used for redevelopment purposes by any entity, except for public use, as defined by general law.

(b) The General Assembly is authorized to grant to counties or municipalities for redevelopment purposes and in connection with redevelopment programs, as such purposes and programs are defined by general law, the power to issue tax allocation bonds, as defined by such law, and the power to incur other obligations, without either such bonds or obligations constituting debt within the meaning of Section V of this article, and the power to enter into contracts for any period not exceeding 30 years with private persons, firms, corporations, and business entities; provided, however that repayment of such bonds or obligations shall be pledged only with proceeds of the local revenue guarantee. Notwithstanding the grant of these powers pursuant to general law, no county or municipality may exercise these powers unless so authorized by local law and unless such powers are exercised in conformity with those terms and conditions for such exercise as established by that local law. The provisions of any such local law shall conform to those requirements established by general law regarding such powers. No such local law, or any amendment thereto, shall become effective unless approved in a referendum by a majority of the qualified voters voting thereon in the county or municipality directly affected by that local law.

(c) The General Assembly is authorized to provide by general law for the creation of enterprise zones by counties or municipalities, or both. Such law may provide for exemptions, credits, or reductions of any tax or taxes levied within such zones by the state, a county, a municipality, or any combination thereof. Such exemptions shall be available only to such persons, firms, or corporations which create job opportunities within the enterprise zone for unemployed, low, and moderate income persons in accordance with the standards set forth in such general law. Such general law shall further define enterprise zones so as to limit such tax exemptions, credits, or reductions to persons and geographic areas which are determined to be underdeveloped as evidenced by the unemployment rate and the average personal income in the area when compared to the remainder of the state. The General Assembly may by general law further define areas qualified for creation of enterprise zones and may provide for all matters relative to the creation, approval, and termination of such zones.

(d) The existence in a community of real property which is maintained in a blighted condition increases the burdens of state and local government by increasing the need for governmental services, including but not limited to social services, public safety services, and code enforcement services. Rehabilitation of blighted property decreases the need for such governmental services. In recognition of such service needs and in order to encourage community redevelopment, the counties and municipalities of this state are authorized to establish community redevelopment tax incentive programs as authorized in this subparagraph. A community redevelopment tax incentive program shall be established by ordinance of the county or municipality. Any such program and ordinance shall include the following elements:

(1) The ordinance shall specify ascertainable standards which shall be applied in determining whether property is maintained in a blighted condition. The ordinance shall provide that property shall not be subject to official identification as maintained in a blighted condition and shall not be subject to increased taxation if the property is a dwelling house which is being used as the primary residence of one or more persons; and

(2) The ordinance shall establish a procedure for the official identification of real property in the county or municipality which is maintained in a blighted condition. Such procedure shall include notice to the property owner and the opportunity for a hearing with respect to such determination.

(3) The ordinance shall specify an increased rate of ad valorem taxation to be applied to property which has been officially identified as maintained in a blighted condition. Such increase in the rate of taxation shall be accomplished through application of a factor to the millage rate applied to the property, so that such property shall be taxed at a higher millage rate than the millage rate generally applied in the county or municipality, or otherwise as may be provided by general law.

(4) The ordinance may, but shall not be required to, segregate revenues arising from any increased rate of ad valorem taxation and provide for use of such revenues only for community redevelopment purposes;<