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The rising number of repossession homes and the uncontrolled growth of housing have been eroding the tax base of county and city governments and their ability to serve their constituents, according to a report from the Auburn University Center for Governmental Services.

Auburn researchers studied housing growth data from the U.S. Census Bureau for the states of Georgia and Alabama from 2000 through 2008 and compared them with data on property taxes.

The analysts, led by Don-Terry Veal, said that Georgia had a much quicker rate of housing growth for the 8-year period than Alabama, so when the housing meltdown started, Alabama was in better condition to survive the storm. Most Alabama counties will not experience the tax problems that many Georgia counties will suffer due to the record numbers of foreclosures.

From 2000 through 2008, a total of 744,000 new housing units were built in Georgia, marking a 22.4-percent housing growth rate and putting Georgia in fourth place across the U.S. in terms of housing growth. On the other hand, Alabama built only 195,000 new housing units, marking only 9.9 percent in growth and putting the state 24th in charts of housing growth in the U.S.

The number of repossession homes was also far higher in Georgia than in Alabama. Based on data from a foreclosure research firm, Georgia has already posted 92,611 foreclosure properties in 2009, compared to only 14,963 units in Alabama.

Georgia’s foreclosure rate of 2.3 percent of all existing homes is nearly 4 times higher than that of Alabama, which has a foreclosure rate of only 0.6 percent.

The Auburn researchers estimated that foreclosures in Georgia will cause a total revenue loss of nearly $249 million in 2009, using the Tax Foundation’s $2,684 estimate of the typical property tax paid by a regular household in Georgia.

In comparison, Alabama is expected to lose only about $16 million in property taxes in 2009 because of its much slower foreclosure pace and its lower property tax estimate of only $1,080 for every household.

David Hill of the Center for Governmental Services said that the center is not against housing developing projects, but that cities and counties need to monitor huge housing growth rates because of the high cost of supporting growth in infrastructure and expanded services in areas with unprecedented housing growth rates.

Recently, the researchers found that four of the fastest growing counties in Georgia were among counties with the largest number of repossession homes in August throughout Georgia.

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