If you thought the debate over whether school boards should participate in redevelopment projects ended with a Constitutional referendum on the November ballot, you were sorely mistaken.

Last Thursday, a state Senate finance committee quietly amended House Bill 63, a piece of legislation meant to iron out details about tax allocation districts, or TADs. TADs use bonds, which are later paid off by increased property tax values in the redeveloped area, to pay for roads, bridges, sewers and schools. They were the go-to option for redevelopment projects in Georgia — think Atlantic Station — until last year's state Supreme Court ruling that said their use of school taxes was unconstitutional. In November, voters approved an amendment that would allow school systems to participate in TADs.

The Senate committee added an amendment to the bill, which has already unanimously passed the House, which would allow Atlanta Public Schools to circumvent a vote and automatically opt back into the Beltline, the 22-mile loop of parks, trails and transit proposed to circle Atlanta's urban core. If so, the school system would contribute an estimated $850 million in school tax dollars to the project over the next 20 years, as it agreed to do in 2005. (Atlanta Unfiltered's Jim Walls, the first blogger to jump on the story, has the language posted.)

The Fulton County Taxpayers Foundation, which fought the Beltline TAD, lashed out at the amendment, calling it an "outrageous abuse of the Atlanta taxpayers." and casting Lt. Gov. Casey Cagle as the author of the language.

As Walls notes, the amended bill could create some interesting drama in lieutenant governor's hometown of Gainesville, where the local school board recently voted not to participate in a TAD because of the economy. Whether the school board will have to defend that decision depends on the bill's passage.

Community activists have begun an email blast that alleges the lieutenant governor is responsible for the amendment.

But in an statement to CL and community members who criticized the amendment, Cagle's office says that the lieutenant governor wasn't at fault.

"To be clear, the Lt. Governor had absolutely no involvement in a Senate substitute to H.B. 63," the statement says. "We are unaware of who suggested he was, but it is a completely false assumption."

It continues: "From our understanding, the substitute bill in the Senate adds language that mirrors the constitutional provision, saying that if a school system had already agreed to become part of a TAD before the constitutional amendment was approved, their agreement will not be unconstitutional. Nothing in this legislation that we are aware of will prevent any school system who is not happy with their TAD agreement from renegotiating the agreement or withdrawing from the TAD altogether. This gives appropriate flexibility to our school systems."

The bill is scheduled before the full Senate for a vote and then back to the House to examine the added language. It'll be interesting to see what the bill's sponsor, House Rules Chairman Earl Ehrhart, R-Powder Springs, has to say about the amendment. In an interview with the Marietta Daily Journal, the lawmaker explained his bill. It's a long article, but the Ehrhart quotes are entertaining.

Something else worth reading: John Woodham, the Atlanta attorney who successfully battled the Beltline TAD to state Supreme Court, replied to the email from Cagle's office. The email was forwarded to him, he writes, and he wanted to offer his opinion. His take: the controversial language might not pass legal muster. For the lawyers in the crowd, and with Woodham's permission, I've reprinted it below.

First, I might observe the Lieutenant Governor is already on the record in support of taking school money away from public education, having created the informal "Senate working group" last year to help revive the practice of diverting school tax money away from public education, in the wake of last year's unanimous Supreme Court decision. I don't think the Lieutenant Governor ever fully explained why it was so important to divert public school money to private development, but I suspect the citizens of Gainesville would like to know now given the current economic climate.

http://ltgov.georgia.gov/00/press_print/0,2669,2199618_74277852_106658491,00.html

In any event, there are various legal improprieties at issue concerning Amendment 2, as well as the Senate substitute to HB 63, but that is for another day and another forum.

However, it must be recognized that if the Senate substitute to HB 63 purports to make prior school board TAD agreements not unconstitutional (nice double negative, I know), then the school board has no way out of the existing TAD agreements, based on basic contract law. In other words, the Woodham decision allows the school board to opt out (actually requires them to opt out) based on the unconstitutional proposition of diverting school tax funds away for non-educational purposes.

If you are now say those existing TAD intergovernmental agreements between the school board and the city are not unconstitutional, the city can then sue for specific performance under those contracts. Declaration of unconstitutionality is the only means for the school board to get out of the existing contracts. On what other basis can Gainesville City Schools terminate the existing TAD agreement if the City of Gainesville wants to enforce it? Answer: none.

Accordingly, the Senate substitute takes the constitutional argument away from the school board, and thereby allows the city to force compliance with the existing agreement against the will of the school board.

You can't have it both ways. The existing agreements are either unconstitutional, or they are not. If they are not, the school board cannot get out.

As such, I respectfully believe your assertion that a school board would still have the "flexibility" to opt out is not consistent with what you say the intent of the Senate substitute is. The school board did not have this flexibility before the Woodham decision in light of basic contract law, the school board has that flexibility right now, but the Senate substitute would have the effect of taking that existing flexibility away.

I hope all this makes sense.

Now putting all that aside, it is also also clear the Woodham v. City of Atlanta decision stands for the proposition that the proposed use of school tax funds for the Atlanta BeltLine tax allocation district violates Art. VIII, Sec. VI, Par. I of the State Constitution, meaning the prior consent resolution and intergovernmental agreement adopted by the Atlanta School Board to contribute money to the BeltLine TAD was void ab initio, i.e., it was a legal nullity such that nothing can cure it.

As such, despite the language proposed in 36-44-9 (g) of LC 18 8377S (the Senate substitute to HB 63), the General Assembly cannot ratify and confirm something that legally never existed. That's basic hornbook law. See Definition of "Void" in Black's Law Dictionary ("incapable of confirmation or ratification").

Therefore, it is my belief that if the Senate substitute inserting subpargraph (g) to 36-44-9 stays in, HB 63 will be rejected by the courts, based on the existing holding in Woodham.

In addition, the Georgia Constitution (Article I, Section I, Paragraph X) prohibits retroactive laws. Also, under Georgia law, “[I]t is axiomatic that the legislature’s power to pass laws is limited by the Constitution itself, and a law authorized generally by one provision of the Constitution may not contravene another provision of the Constitution". Glover v. Donaldson, 243 Ga. 479, 482 (1979) (emphasis supplied).

In the situation at hand, that would mean that the general authority given to the legislature to pass a new TAD bill pursuant to Amendment 2 (SR 996) cannot trump the existing Constitutional prohibition against retroactive laws in Article I, Section I, Paragraph X.

Putting all this aside, it would seem the Lieutenant Governor would have some level concern regarding the Senate substitute to HB 63, ask where it came from, which Senator proposed it, and even request that it be deleted, in order to protect and preserve Gainesville school tax dollars and the "local choice" so cherished by the advocates of Amendment 2.

Finally, Senator Balfour, the Senate sponsor of HB 63, and Senator Chance, chair of the Senate Finance committee, need to stand up and explain to the citizens of Atlanta, Gainesville, and the balance of the State of Georgia, where this outrageous Senate substitute to HB 63 originated.

Sincerely,

John Woodham