A Georgia Supreme Court ruling against Chatham County over fire protection fees will have a resounding impact on cities and counties across the state.
The unanimous decision issued this week affirms a lower court’s finding that the fire fees assessed by the county were illegal taxes under Georgia law. The issue? The fees were actually a property tax that failed to comply with legal requirements set forth to protect taxpayers.
Background
The lawsuit stemmed from a dispute over fire fees collected between July 1, 2022, and June 30, 2024. Specifically, the issue was whether Chatham County could lawfully impose mandatory fire protection fees based on property ownership and the square footage of structures rather than the assessed value of the property – more commonly known as a millage rate..
Prior to July 2024, Chatham County did not have its own fire department. The county offered services to the unincorporated parts of the county with intergovernmental agreements with city fire departments, volunteer departments, and private providers – such as Chatham Emergency Services (CES).
When CES faced financial difficulties, Chatham County instituted a fire protection tax in a special service district (SSD), but later replaced it with a Fire Protection Service Fee. The fee was assessed on an annual basis on parcels of real property.
In FY 2022, the fee was $100 for land and additional charges added on based on the square footage of structures on the land. The charges ranged from $75 for 500 square feet or less to $10,000 for 50,000 square feet or more.
In 2023, the county revised the formula, charging $100 for vacant parcels and $0.14 per square foot for structures, with a minimum charge of $100.
Through the ordinance the county enacted, commissioners gave the county authority to impose late penalties ($25 or 10% of the total due), pursue collection lawsuits, recover attorney’s fees and court costs, and place liens resulting from the judgments. The ordinance also imposed $500/day fines with 50 hours of community service assessed for each day of violation.
CES still could not sustain its business model and the county assumed all fire protection services in 2024. The county then converted the fire protection funding into a portion of the millage rate.
The story didn’t end there, however.
Legal Challenge
Damon L. Smith and Sebrell E. Smith filed a class action lawsuit challenging the fire protection charges, asserting that it was not authorized by law because it was not a fee for a service, but a mandatory tax imposed on real property.
Senior Judge John Turner, formerly of the Ogeechee Circuit presiding over the case in Chatham County Superior Court due to recusals by the local judges, agreed. The court certified the case as a class action, granted summary judgment in favor of the property owners, and determined that the fees constituted illegal taxes. Judge Turner also determined that impacted property owners should be refunded $26,852,778.90 plus an additional $3.2 million in prejudgment interest. In total, the judgment against the county totaled $30.13 million.
Chatham County appealed to the Georgia Supreme Court.
Supreme Court Says Calling It a ‘Fee’ Doesn’t Make It One
On October 14, 2026, the Georgia Supreme Court handed down an 25-page opinion in which it handily rejected the arguments made by Chatham County.
The Court found that Chatham County’s fire protection charge had the characteristics of a tax because it was mandatory, funded the general availability of a public service, was not based on individual use of fire protection services, and did not provide paying property owners with a special benefit unavailable to others.
In the ruling, justices wrote:
- government charges must be evaluated based on their actual purpose and operation rather than the labels assigned to them by local officials.
- fire protection services were available to everyone within the designated district, regardless of whether individual property owners paid the fee. Testimony had established that firefighters were obligated to respond to emergency calls without consideration of payment status.
- county officials had conceded that the square footage calculations were based on common sense rather than actual fire service data.
“A tax is ‘an enforced contribution exacted pursuant to legislative authority for the purpose of raising revenue to be used for public or governmental purposes, and not as payment for a special privilege or a service rendered.’”
The conclusion, based on those facts, was that the fees were imposed to raise revenue for a governmental purpose rather than as payment for an individually provided service.
Because It Is, In Fact, a Tax, It Is Not a Lawful Tax
The Georgia Supreme Court then evaluated whether or not Chatham County had the legal authority to impose the fee based on the formula in the ordinance.
Chatham County relied on the Georgia Constitution’s provision on special service districts, interpreting the language broadly as a default authority it possessed.
The justices disagreed.
Citing Georgia’s Service Delivery Strategy Act in place at the time of the assessed fees which required that property taxes imposed to cover services in unincorporated parts of a county had to be based on property values.
Under Chatham County’s ordinance, two properties with substantially different market values could be charged the same amount simply because their structures had similar square footage.
“The Fire Fee Ordinance therefore was not an exercise of the County’s ‘power of taxation as authorized by this Constitution or by general law.”
The Supreme Court wrote that the county could not circumvent taxation restrictions set out in state law.
“The Fire Fee Ordinance therefore violated the mandate of that statute by using a funding mechanism that it did not permit.”
The decision was unanimous among the participating justices. Chief Justice Nels S.D. Peterson was disqualified.
Refunds and Interest
The decision by the state’s high court does not outline how or when the county will distribute funds to individuals impacted by the fee. It also does not address how the county will finance the $30 million obligation.
Ripple Effect for Other Georgia Counties and Cities
The ruling from SCOGA reinforces limits on local government’s ability to characterize a tax with different language when the operational characteristics mirror a tax.
Walker County has the same fire fee structure as Chatham County prior to their millage rate change: $0.14 per square foot on buildings with a residential minimum of $125 and a maximum of $600.
Until recently, McDuffie County had a $3.12 per acre fee for wildfire protection and $0.05 fee for square footage.
Also happening recently, the City of Richmond Hill settled a lawsuit in Lanier v. City of Richmond Hill after the imposition of a $225 fire fee on residential properties, $112.50 on undeveloped residential lots, $600 on commercial properties, and $300 on undeveloped commercial lots. The city agreed to a $5 million settlement.
Just last week, Emanuel County settled a lawsuit over the same fees ($30/parcel), assessed from 2019 to 2025. The county will refund some $650,000 in fees.
Damon and Sebrell Smith were represented by John Manley and James Shipley JR of Manley Shipley in Savannah.
The County was represented by the Chatham County Attorney’s Office.
