A recent Georgia Supreme Court ruling striking down Chatham County’s fire service fee could have significant implications for how cities across Georgia fund fire protection and other essential services.
In a unanimous decision issued Wednesday, October 14, 2026, the Georgia Supreme Court ruled that Chatham County’s fire service fee was effectively a property tax rather than a service fee. Because the charge was not based on the assessed value of property, the Court found that it violated the Georgia Constitution. The ruling could require Chatham County to refund approximately $30 million in fees and interest as part of a class-action lawsuit.
The decision in Chatham County v. Smith, written by Justice John J. Ellington, could also affect other local governments, including cities, that rely on similar fees to fund essential services.
GMA is evaluating the full implications of the ruling but is concerned about its potential impact on municipal finances and property taxpayers.
Many local governments use service fees to distribute the cost of providing services among the properties that benefit from them, including properties that are otherwise exempt from property taxes. The Court’s decision raises concerns about cities’ ability to continue using this approach, potentially requiring them to rely more heavily on property taxes to fund these services.
This distinction is particularly important for Georgia’s cities, which contain a disproportionate share of the state’s tax-exempt property. Although cities comprise only approximately 8.4% of Georgia’s land area, they contain roughly 44% of the state’s tax-exempt property.
Hospitals, colleges, nonprofit organizations, and government-owned properties all benefit from essential municipal services but generally do not contribute to the cost of those services through property taxes. If cities are unable to recover service costs through fees, the financial burden of serving these properties could shift to homeowners and businesses that pay property taxes.
At a time when property tax burdens are already a significant concern across Georgia, this potential shift could place additional pressure on municipal budgets and property taxpayers.
The ruling also raises broader questions about whether changes to the Georgia Constitution may be necessary to preserve local governments’ ability to fund certain services through fees based on the cost of providing those services rather than property values. A constitutional amendment may ultimately be required to restore that flexibility.
GMA will continue reviewing the decision, evaluating its implications for cities, and exploring potential legislative solutions to ensure that municipalities have the tools necessary to fund essential services fairly and effectively.
GMA encourages cities that currently impose fire service fees or similar charges to consult with their legal counsel to evaluate the potential impact of the ruling on their local practices.