Amendment 2 on the ballot asks: "Shall the Constitution of Georgia be amended so as to authorize community redevelopment and authorize counties, municipalities, and local boards of education to use tax funds for redevelopment purposes and programs?"
Allow us to interpret: Do you want the Beltline to get the money it needs, or do you want it to be a long-rolling urban disappointment?
To understand the issue, first wrap your head around the idea of "tax allocation districts" – which were supposed to be the main funding source for the $2.4 billion proposed intown loop of parks, trails, transit and development.
For two decades now, cities and counties have, with the approval of local voters, created TADs around blighted areas. They sell bonds to pay for roads, parks, sewers and other fixes that spur development and boost property values within the TADs. At the same time, they freeze property tax revenue schools and local governments get from districts. The money that comes from higher property values is used to pay off the bonds. Without a TAD, Atlantic Station might still be an abandoned steel mill full of hazardous waste.
The Beltline (along with 40 other TADs) suffered a huge blow in February when the state Supreme Court ruled that using school property taxes for noneducational redevelopment violated the state's constitution. Because the bulk of property taxes in Georgia are levied by school boards, the development scheme du jour lost more than half its revenue stream overnight.
There are valid concerns about TADs. Big developers, who are getting help with the infrastructure they need for glitzy office towers, often whine like spoiled children when TADs require them to set aside affordable housing or do other things in the public interest. And any program that opens a spigot of public funds can end up being used for well-connected interests or distort market forces.
Still, most TAD projects have ended up funding the kind of community building needed to turn Atlanta and other cities into better places.
Of course, there's nothing like pissed-off developers to spur our state's politicians to action. After the court ruled, the General Assembly quickly passed a referendum that placed Amendment 2 on the ballot. If passed, it would revive the option of using school taxes for redevelopment purposes.
In the interim, the private sector's contributed to the Beltline, but that largesse gets things only so far – especially when other projects are competing for big bucks in a tight economy. And buyers of municipal bonds – long the go-to mechanism for cities to fund infrastructure improvements – have melted away with the credit crisis.
The Beltline isn't perfect. Skyrocketing property values around it already have displaced residents. The city's also been less than nimble with some purchasing practices (most obviously in dealing with mega-developer Wayne Mason over a huge tract of land in northeast Atlanta).
But the Beltline promises to be a tranformative project for the city. It will surpass Atlantic Station as the nation's largest "brownfield" project, converting 1,100 acres of former industrial sites into centers of commerce and leisure, and creating an alternative to the car in the heart of the city.
The challenges so far actually are arguments for a more dependable revenue stream. TADs would allow the city to move quickly in securing land that's needed for the parks, trails, transit and affordable housing. The quicker they can move, the better.
If we fail to provide the funding, shame on us for failing to grasp what's necessary to make that vision a reality.
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It is very disappointing to learn that an imposter has posted responses from Cheryl Strickland, Kenneth Bleakley, and me that do not represent our opinion. I support the approval of Constitutional Amendment #2 and was pleased to see that Creative Loafing is also on record supporting this measure. This is an important and effective tool to promote economic redevelopment in blighted areas. Cities, counties and school systems in Georgia, similar to those in 46 other states, should have the authority to exercise these powers for the long-term financial health and quality of life of their communities. Discussion in a community in which feelings can be strong is kept civil and constructive by our willingness to attach our names our real names to our ideas. That civil, constructive discourse, even when we disagree, only stands to make us stronger.
Vote "No" on Amendment No. 2!
Diverting educational use tax money to subsidize private development is a sham. It is corporate welfare and a bailout for weak developers.
It is also an indirect tax increase on all other citizens who must pay to educate the children moving into the tax allocation district. Most folks in commercial real estate will concede privately that diverting school tax funds away from education is wrong.
Any commercial real estate project should go forward, or not, based on free market forces and supply and demand, not based on government handouts.
Definitely vote "No" on Amendment No. 2
Given the shrinking educational budgets faced by school systems all across the State, this is no time to use precious school tax money for corporate welfare and government bailouts of developers.
If we are going to be taxed for educational purposes, then that money must be used for education, not for private development!
Again, vote "No" against Amendment No. 2 on November 4.
Patrick Malone explains it all very well below:
Amendment No. 2: Big guns in development shouldnt fool us this time
By PATRICK MALONE
Wednesday, October 01, 2008
Our Legislature, in cahoots with the development community, has crafted a vague and misleading November ballot question. Counties and municipalities already have the right, along with eminent domain powers, to use your tax funds for redevelopment purposes. However, without including these references, this ballot question would be asking voters to provide the authority to use school taxes to fund redevelopment projects only to local school boards. None of us is stupid enough to vote for that.
We have elected local school boards because of their commitment to education. Approving this amendment would put them in the real estate speculation business. Recent news shows some school boards incapable of even executing their educational responsibilities, let alone making real estate judgments 25 to 30 years in the future.
The proponents of this amendment will tell you an investment today will pay future financial dividends for our schools. If you believe that, I suspect your retirement strategy is based on winning the Mega Millions lottery and that you consider a trip to Las Vegas an investment in your financial independence. The odds are not in your favor.
Those in favor will tell you this amendment will cost the Georgia taxpayers nothing, but we believe Clark Howard when he says, If it sounds too good to be true, it probably is. School costs will go up over the next 25 to 30 years and if a certain part of the school tax digest is diverted to developers, the remaining taxpayers will have to pay even more than their fair share.
The big guns in development communities across the state are going to tell us that Armageddon will befall us if this amendment doesnt pass. Yet Atlantas Beltline project is proceeding with a $120 million bond issue without the school tax revenue. It seems to me that the only problem is those redevelopment projects that are financially shaky now wont get done. I fully expect those who have the most to gain from this amendment will continue to make their case that these bonds will make neighborhoods safer, reduce gang activity, provide traffic congestion solutions and the host of other specious arguments they used to pass the TAD referendum in those counties and municipalities where it is currently authorized.
I believe that this amendment to divert school taxes for 25 to 30 years to retire tax allocation district bonds is the most insidious form of corporate welfare at the expense of our childrens, grandchildrens and future generations education.
Fool me once, shame on you. Fool me twice, shame on me. This November, dont be fooled again. Vote no on amendment No. 2.
Patrick Malone, is a senior partner of the PAR Group, a consulting and training firm.
Vote "No" on Amendment #2. Our school tax dollars should be used for schools. What sense does it make to give school tax dollars to real estate developers? In almost every category, Georgia's schools are the worst in the entire nation. Our schools must improve if we want the state to be prosperous and attractive to employers. Money is not the sole answer to remedying our severe educational failings, but there are serious funding problems throughout the state. So don't tax us for "schools" and then divert the money to other purposes. If a school system does not need the money, then lower the millage rate.
The BeltLine is a worthwhile project, but not noble enough to mortgage our children's future. And when one realizes that the current plan is to use most of upcoming TAD bond proceeds to give Wayne Mason a huge return on the land he sold to the BeltLine in the Northeast quadrant of Atlanta, I say, save our school tax dollars for our children and our schools.
Cheryl Strickland is an absolute supporter of Amendment 2 - Vote Yes! To echo the comments made by my colleague Tina Arbes, I too was shocked and dismayed to learn that an imposter has posted responses on this site misrepresenting our opinions in an effort to sway those of the readers. Thank you Creative Loafing for your thoughtful support of the proposed amendment. TADs are a national best practice approved in 49 of 50 states and I am personally committed to supporting its most impactful and responsible use in Georgia. TADs can be implemented without diverting a single dollar away from existing school budgets and can eventually provide a revenue windfall to schools in otherwise slow or no-growth areas. In these challenging economic times, TADs are an important tool that Georgia needs to catalyze growth in jobs and government revenues without raising taxes. The passage of Amendment 2 will restore the option of choice to local school districts in Georgia. Every community in Georgia may not want or need to use TADs but passage of Amendment 2 will give Georgia's local communities the future right to decide whether TADs and school district participation are right for them. Finally, voter education and a healthy debate on this topic are encouraged but any honest engagement requires that we attach our own names to our opinions! Thank you and Vote Yes for Geogia's TADs. Cheryl Strickland, Managing Director - Tax Allocation Districts, Atlanta Development Authority
We took three comments to this story down because the commenter who's opposed to Amendment 2 falsely attributed those comments to well-known people who are on record as supporting Amendment 2. The false use of their names was brought to our attention by two of the people whose names were misused. We don't police comments, but when obvious misrepresentations are brought to our attention, we'll do what we can to correct them.
VOTE "NO" ON AMENDMENT 2!
The Atlanta Journal Constitution editorial board is officially on record supporting the Supreme Court's decision last February declaring that educational tax dollars should not be diverted to subsidize private development*.
Amendment No. 2 would have the effect of overruling the Georgia Supreme Court on this very important issue.
Given the shrinking educational budgets faced by school systems all across the State, this is no time to allow a corporate welfare bailout for developers at the expense of the education of our children.
Our property taxes are high as it is. Passage of this Amendment would only raise taxes even more. If we are going to be taxed for public educational purposes, then that money must be used for education, not for private development!
Please also be aware that the Georgia Association of Educators, the leading advocacy group for public education in the State of Georgia with over 40,000 members, has taken an official position against Amendment No. 2, because of the negative impact it would have on public education in the State of Georgia. (See link below)
www.voteducation.org/more/index.cfm?Fuseaction=more_51807§ion=more_51807
Again, more reason to vote "No" against Amendment No. 2 on November 4.
Please pass this information to at least 50 friends, colleagues and fellow parents, so that the word will spread all across Georgia about this very important issue.
By Mike King
The Atlanta Journal-Constitution
Around the Atlanta region, elected officials have rushed in recent years to grant tax breaks to private developers to re-energize rundown areas. Indeed, politicians and municipal redevelopment officials have overused special tax
zones known as tax allocation districts, or TADs -- sometimes where they're not needed.
The Georgia Supreme Court was right to rein them in last week, ruling that cities and counties can't take property taxes that normally would be going to schools and use them instead to help private developers build retail, commercial and residential projects. After the court ruling, municipal leaders and economic development proponents -- including those pushing Atlanta's Beltline project, the subject of the lawsuit -- confidently
predicted their plans could go on without the school-tax money. It makes you wonder why they needed a TAD in the first place.
The state constitution is explicit on school taxes. It says they can be used only for educational purposes. TADs divert property taxes from redeveloped areas so they can instead pay off the bonds needed to finance the redevelopment in the first place. Since about half to two-thirds of the property taxes collected in metro Atlanta are levied by the school districts, city and county redevelopment officials say some of the projects
they want to pursue may die on the vine unless they can legally tap the revenue that would be going to schools.
Diverting property taxes from municipal and county governments may not be enough, they said. Legislative leaders vowed later in the week to help them out --
suggesting, among other things, a constitutional amendment to allow the practice. That would be a big mistake.
The court's ruling should spur local leaders to reconsider their options, not fundamentally alter the tax structure for schools. Many of the projects that were slated for TAD money could still get financed in more conventional
ways -- a combination of private market investment and development authority bonds secured by the governments promoting them. But that probably means they will not be as grandiose as originally conceived.
As originally envisioned, TADs were meant to be used sparingly and for only very specific reasons. Local governments could turn to them to help redevelop economically blighted areas that were prohibitively expensive for
private enterprise; costs might have included cleaning up a
contaminated site, for example. The first major use of a TAD in the metro area was the impressive Atlantic Station project in Midtown Atlanta, the site of a former foundry that had been shut down and rusting for years. But as the economy tightened and private investment dwindled, local officials around metro Atlanta -- urged on by developers, bond attorneys and financial advisers -- started pushing TADs for all sorts of projects. Some involved
purchasing rundown retail strips whose owners had been sitting on the property for years, without spending much money to improve it.
Others involved buying up apartment complexes and tearing down whole tracts of single-family dwellings that had been turned into rental property. Marietta approved TAD money for two small developments after they had already been started. The hope was to reclaim the rundown areas -- which
were producing little in the way of property taxes -- by developing
mixed-use (residential, retail and commercial) projects. There are about three dozen proposals to use TAD financing now scattered across metro Atlanta, both small and large -- including the giant Sembler project in DeKalb County, where supporters claim road improvements, sidewalks and other public works may need as much as $115 million in TAD financing to carry out the $1 billion plan. Virtually all of them promise a better tax base -- and
consequently, a fatter treasury for schools and local governments -- later on. No doubt some of them will make good on the promise.
But too often, the use of TADs seemed designed simply to profit slumlords by providing what amounts to a government subsidy for the developers to buy them out. Residents should ask whether redevelopment of the property could
be accomplished through more conventional financing -- or whether the gentrification of an area will take place through private market forces.
That's the position the Cobb County school board has taken on several TAD proposals. The wisdom of the board's decision to delay approving tax allocation funds for two Smyrna projects was validated by the court's ruling Monday. "We caught a lot of flack for it, but it was the right thing to do," said Lindsey Tippins, a long-time board member.
Proponents of TADs often mischaracterize Tippins and others like him as being anti-redevelopment. That's unfair. Reviving rundown residential,
retail and commercial areas should remain a high priority for city and
county officials throughout metro Atlanta. But they'll have to do it by putting their own money on the line, not diverting taxes that should be going to schools.
-- Mike King, for the editorial board (mking@ajc.com)
First of all, all Georgia taxpayers with any sense should vote "No" on Amendment No. 2. This is nothing but a corporate welfare handout and bailout sham for weak and inexperienced developers.
Edelstein, you say you deleted three posts which were contrary to your position on Amendment No. 2 because the posters were "imposters"?
What a pathetic excuse for removing substantive argument contrary to your own opinion. Are the Easons aware you operate this way in Atlanta? Perhaps the Tampa headquarters should be more aware of the embarrassing way you operate in Atlanta.
Indeed, Creative Loafing has now hit rock bottom. Not only because of the recent Chapter 11 bankruptcy filing, but because of childish editorial actions such as yours.
Here, read the actual senate bill yourself:
http://www.legis.ga.gov/legis/2007_08/fulltext/sr996.htm
Atlanta, Atlanta, Atlanta!!!! I realize that this is an Atlanta-based website, but as a resident of rural northwest Georgia who is seeking both facts (i.e. the original text of the amendments)and (educated) opinions concerning this amendment, I would like to know how this particular amendment would work for the benefit or the detriment of public education/ development projects in areas OTHER than Atlanta. Georgia is, as I recall from my eighth-grade Georgia history class, the biggest state east of the Mississippi River. There are many other school systems /development projects in this vast state--urban, suburban, and rural. Please consider them too, and what is best for not just one metropolitan area (albeit the biggest), but the whole state. Opinions, please?
Thanks,
Katy Hutchings
"First of all, all Georgia taxpayers with any sense should vote "No" on Amendment No. 2. This is nothing but a corporate welfare handout and bailout sham for weak and inexperienced developers."
How, Dave? How is the creation of specific legislation to improve infrastructure in areas a corporate bailout? TAD legislation is meant to specifically fund capitol improvements in selected areas. It doesn't intersect with corporate responsibility at all. Mayhaps you don't know what you're talking about?
"Diverting educational use tax money to subsidize private development is a sham. It is corporate welfare and a bailout for weak developers."
TADs don't fund private development. They fund public infrastructure.
"Our school tax dollars should be used for schools. What sense does it make to give school tax dollars to real estate developers?"
TAD funds don't go into the pockets of private entities. They go to fund bonds to pay for necessary improvements. Sheesh, this place is a nest of astroturfers.
"Our property taxes are high as it is. Passage of this Amendment would only raise taxes even more."
That is absolutely not how a TAD works. TADs count on the difference between the level of funding at the point of passage versus the funding gained as values increase. There's nothing inherent in a TAD that would affect millage rates.
The least all these 'concerned advocates' could do is get their facts straight before trying to poison public discourse.
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