Tuesday, September 25, 2007
News Georgia Supreme Court hears Beltline funding arguments
Posted by Thomas Wheatley @thomaswheatley on Tue, Sep 25, 2007 at 7:07 PM
After languishing in legal limbo for six months, the Georgia Supreme Court heard arguments today between Atlanta attorney John Woodham and lawyers representing the city, county and Atlanta Board of Schools over whether the funding mechanism implemented to fund the massive Beltline project was unconstitutional.
The funds at issue this morning were $200 million in validated bonds approved by the city of Atlanta, Fulton County Commission and the Atlanta Board of Schools.
Woodham — representing himself — argued before the court that a tax-allocation district, or TAD, would violate the state's constitution by using school tax revenues for noneducational purposes. Woodham said $982 million of $1.7 billion collected in the TAD would be school tax funds. If the money was used to build new schools, he argued, that would be one thing — but that is not the case in what he called "essentially a city infrastructure project." He cited a state Supreme Court case in 1994 between DeKalb County Schools and DeKalb County, where the latter requested that the former fund road improvements. The court ruled in favor of the school board.
Matthew Calvert, attorney for the city of Atlanta, argued that the TAD falls under the Redevelopment Powers Law — a statute that allows municipalities to set up funding strategies for dilapidated or blighted areas — and that the Beltline is "an investment in the future." Calvert said Atlanta voters approved the TAD in a special election and that Woodham had ignored that the city "made a legislative determination that redevelopment could not be developed absent of [implementing the TAD]."
"Woodham's assumptions are unfounded," said Charles Johnson, attorney for Atlanta Board of Schools. He said the school board's revenues will "be no less than before," and that in its agreement with the city, the school board has nothing to lose should the grand vision of the Beltline ultimately fizzle, and the city has a contractual agreement to fund specified school projects.
Woodham took the podium briefly to rebut: "The benefits are irrelevant," he said. "Are the funds being used for educational purposes?"
Beltline planners have estimated half of the funds needed to pay for the $2.8 billion project would be generated from the TAD. Including the Beltline, there are six total TAD projects in Atlanta: Princeton Lakes, Atlantic Station, Eastside, Westside and Perry/Bolton. Woodham's lawsuit is the first to challenge a TAD.
The court has until March 2008 to issue a ruling. Until it does so, the city is no further off than it was before — crossing its fingers with hope that the justices will rule in its favor. After the hearing, Terri Montague, CEO of Atlanta Beltline, said planners hope for a favorable ruling but would continue to work on the project as they have been.
"The TAD is an important part but not the only part," Montague said. She added that Beltline planners would continue to reach out and explore other means of funding.
If the court rules in favor of Woodham, the Beltline has a daunting task ahead of it — come up with a load of cash for a project that advocates, developers and politicians are banking on being a saving grace, an economic windfall and a lasting legacy.
And just as hurriedly as Woodham entered the court, he left in a flash. E-mails for comment were sent to him, and we'll keep you updated as to what he thinks about the morning's hearing.
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