HERON LAKE II APARTMENTS, LP v. LOWNDES COUNTY BOARD OF TAX ASSESSORS, 306 Ga. 816

Eight partnerships developed and operate LIHTC (Section 42) affordable housing in Lowndes County; owners executed use-restrictive covenants and sold credits via limited partnership interests to investors.
LIHTCs reduce investors’ federal/state income tax liability over a 10‑year credit period; properties are subject to long‑term rent and transfer restrictions.
The General Assembly amended OCGA § 48-5-2(3) several times: 2001 added a provision excluding Section 42 credits from valuation; this Court in Heron Lake I (299 Ga. 598) held that categorical exclusion unconstitutional.
In 2017 the legislature revised § 48-5-2(3)(B) to prescribe limited uses of (i) a sales-comparison approach that may consider credits when comparable sales had transferable unused credits, and (ii) an income approach that may consider credits only if they “generate actual income” to titleholder.
Lowndes County Board filed a 2017 declaratory-judgment action challenging the 2017 amendment and seeking to treat LIHTCs as income in appraisals; the trial court (1) found it had jurisdiction, (2) held LIHTCs could be treated as "actual income," and (3) declared both subparts (I) and (II) unconstitutional. This appeal followed.

Issue	Board's Argument	Appellants' Argument	Held
1) Jurisdiction: Was the Board’s declaratory action justiciable before 2018 assessments?	Suit posed a concrete controversy about how to value credits for 2018 assessments; DJA properly invoked.	Case was premature because 2018 assessments had not been made; court would issue advisory opinion.	Trial court had jurisdiction under the Declaratory Judgment Act; controversy was definite and justiciable.
2) Statutory meaning: Do LIHTCs constitute "actual income" under OCGA § 48-5-2(3)(B)(vii)(II)?	LIHTCs may be treated as income in the income-approach appraisal and thus increase assessed value.	LIHTCs are tax offsets that merely reduce investors’ tax liability, not cash income to the owner/investor.	LIHTCs do not constitute "actual income" as commonly understood; they typically only reduce tax liability and thus are not includable as income under (II).
3) Constitutionality: Are OCGA § 48-5-2(3)(B)(vii)(I) and (II) unconstitutional under Georgia’s uniformity clause?	The legislature reasonably limited appraisal methods and acted within authority to prescribe valuation methods; provisions don’t bar consideration of credits.	The statutory limits replicate the prior unconstitutional exemption and create nonuniform treatment.	The 2017 provisions are constitutional: they do not categorically bar consideration of credits and prescribe reasonable, nonarbitrary limits on the sales-comparison and income approaches.

Heron Lake II Apts. v. Lowndes County Bd. of Tax Assessors, 299 Ga. 598 (2016) (earlier decision holding a categorical statutory exclusion of LIHTCs from valuation violated equal-taxation/uniformity).
Randall v. Loftsgaarden, 478 U.S. 647 (1986) (tax deductions and credits do not constitute "income" for purposes of statutory definitions).
Fed. Deposit Ins. Corp. v. Loudermilk, 305 Ga. 558 (2019) (statutory text should be read in its ordinary meaning).
Gaddy v. Ga. Dept. of Revenue, 301 Ga. 552 (2017) (characterizing tax refunds/credits in tax-law contexts).
Dev. Auth. of DeKalb County v. State of Ga., 286 Ga. 36 (2009) (presumption of constitutionality for legislative acts).
Dougherty County Bd. of Tax Assessors v. Burt Realty Co., 250 Ga. 467 (1983) (different appraisal methods may be used without offending constitution).
Pine Pointe Housing v. Lowndes County Bd. of Tax Assessors, 254 Ga. App. 197 (2002) (Court of Appeals analysis of LIHTC valuation issues).