When spending TAD dollars and selling City of Atlanta land, let’s act smart
By Maria Saporta
After almost no activity during Atlanta Mayor Kasim Reed’s first term in office, a sense of urgency has gripped City Hall when it comes to selling real estate and spending Invest Atlanta’s Westside TAD (Tax Allocation District) dollars.
What is not totally understood is: What’s the rush?
During the Nov. 19th Invest Atlanta board meeting, several multi-million dollar grants of Westside TAD dollars were granted – which led me to ask: How much is left?
When I posted this story Monday evening, officials at Invest Atlanta said they couldn’t give me a number until Tuesday. At 10:21 a.m. Tuesday morning, Invest Atlanta’s Ernestine Garey sent me an email saying that the “unrestricted funds in the Westside TAD total $14.74 million.”
As you can tell in the next few paragraphs, my back-of-the-envelope estimates before I received that email were not that far off.
As of June 2013, a city report delivered to Fulton County Commissioner Emma Darnell, who sits on Invest Atlanta’s board, showed that there was about $53 million in the Westside TAD. That TAD includes Vine City and English Avenue – the communities directly impacted by the new Atlanta Falcons stadium.
During the negotiations for a new Falcons stadium, the city committed $15 million of the Westside TAD to be invested in the community as matching dollars to $15 million pledge made by the Arthur M. Blank Family Foundation.
The city also committed $8 million of Westside TAD dollars to the Better Buildings Challenge.
Those two investments dropped the Westside bank balance down to $30 million.
Then at the last Invest Atlanta board meeting, the group approved a $4.4 million grant to Post Properties to develop a 407-unit apartment building across Centennial Olympic Park from the Center for Civil and Human Rights and the World of Coca-Cola.
The board also approved $4.2 million to Bolton Atlanta LLC and the Gallman Development Group for a hotel, apartment and retail project in the Castleberry community.
The board also approved a $275,000 grant to APD Urban Planning Management to serve as an “implementation agent” for the Westside TAD.
During the same meeting, the Invest Atlanta board approved two other grants that were not part of the Westside TAD.
A $1.5 million Economic Opportunity Fund grant helped lure WorldPay’s corporate headquarters to intown Atlanta. -continuing the trend of high-tech companies moving to more urban and walkable communities in search of younger educated associates.
Also, K&K Soul Restaurant is receiving a grant of $172,000 from the Downtown Facad Improvement Grant Program.
Adding everything up, and there is an estimated $20 million left in the Westside TAD. Plus, insiders have said that Post Properties is likely to receive another $4 million at a future Invest Atlanta board meeting – bringing that total to less than $16 million.
So let me ask some questions.
What is the rush?
Why are we spending so much money at such a fast pace?
Why are we giving multi-million dollar grants to well-established developers to develop in already successful downtown districts?
Why did some significant grants awarded in the Westside community go to individuals who have been irresponsible with past funds?
Could the city have been more strategic with its bank account if it had made more targeted grants – spacing them out and giving the market enough time to respond to the major project investments being made in the area (the new Falcons stadium, the new attractions, Georgia State, Friendship Baptist Church)?
To be fair, during most of the mayor’s first term, we were in a deep recession, and there was not much of an appetite to finance new real estate investments in Atlanta for several years. Now, one could argue that Invest Atlanta and the city are trying to ride the current wave of investor confidence in the city.
On the other hand, one could argue that it would have made sense to wait and see how much of the development wave could have been financed privately without having to use precious public TAD funds.
Courtney Knight, managing director of redevelopment for Invest Atlanta, said through a spokeswoman that it was late last year that the Community Benefits and Strategic Implementation plans were finalized.
They “served as the catalyst for key projects within the Westside TAD to be funded, and aggressive work has been done to ensure a diversity of projects will be initiated in coming months through various programs,” Knight said.
Meanwhile, just as there has been a rapid draw-down of Westside TAD dollars, Mayor Reed has been moving full-speed ahead with plans to sell off as much of the city’s real estate as he can.
Again, this raises questions.
What’s the rush?
Are we being as strategic as we should be?
Are we working in Atlanta’s long-term interest when we sell our major land holdings within a short period of time?
Personally, I do believe that it is in the city’s best interest to sell Underground Atlanta. And from what I understand, there is a serious buyer with financial means who has a real vision for the property. It would have preferable if that process had been more public, but that is not this mayor’s style.
But all the other real estate deals that are sitting on the mayor’s desk only raise more questions.
Turner Field. Why is the community being shut out. Why is Fulton County, which has one-third interest in the site, being shut out?
Civic Center. Will the city deviate from its behind-closed-doors process and let the community participate in reviewing the entries to its Requests for Qualifications?
Fort McPherson: Regular readers already know how I feel about that one. The city doesn’t even own those 488 acres, and the mayor is still calling the shots.
We are being told that selling most of the property is a good thing when actually the reverse is true. The city would be a much smarter strategic investor if it phased in the development of Fort McPherson, allowing the property to increase in value rather than selling most of it at a bargain basement price.
So I ask again. What’s the rush? What’s the urgency?
Let’s act. But first, let’s act smart.
David Pendered, managing editor of SaportaReport, contributed to this report.
The problem with “involving the local community” is that the local community is generally willfully ignorant of (in the non-insult meaning of the term) and hostile to the actual needs of business owners and middle-high income residents needed to redevelop an area. If the comments made in the media by the residents of Fort McPherson and the area around Turner Field are representative, such folks are heavily invested in a “Great Society” mentality where it is the duty of the government, corporate America or “someone else” to come in, “invest” huge sums of money in the area to provide the local residents with whatever they want, regardless of whether the people providing that large capital ever get a return on their investment. And yes, such people would prefer no investment or redevelopment at all to it not being redeveloped “their way.” Instead, such people will continue to claim that the area has been victimized by corporate redlining and purposeful lack of investment by the government for the next 100 years. As such, there is nothing positive to be gained by involving people with unrealistic demands in the process.
And yes, the Fort McPherson people are an excellent example. They want:
A) high paying jobs in highly respected industries
B) lots of green space
C) lots of “affordable housing”
and other pie-in-the-sky goodies
or they want nothing. Which, of course, means that they will get nothing. No private investment interests are going to choose that area when they can build the same projects elsewhere for 1/3 the cost, and the city/county/state governments are going to prioritize projects in areas that are actually likely to attract businesses and high income residents.
The city has two choices. It can either work with whoever wants to invest there and take what they can get, or it can side with the residents and spend the next 100 years complaining about how that area is victimized by institutional racism and capitalism. Of course, it is easy for members of the media and for academics to assert solidarity with their comrades who choose the former, but most of those people live in Buckhead or in trendy areas downtown. Sure, they can go interview the local activists and self-appointed leaders in those areas and consent to their grievances, but at the end of the day people like Ms. Saporta drive (or take MARTA) home to the good side of town. and city leaders are the ones left with actually trying to attract investment, improve schools, lower crime etc. in those areas. GOOD city leaders attempt to do what Reed is doing. Bad ones simply don’t deal with the issue for fear of offending the local residents and activists.
Instead of siding with the residents and their unrealistic demands, why not ask the Fort McPherson activists (and if I am correct Shirley Franklin, who appears to be siding with them if I can recall) if they can list 3 reasons that are actually based in economics and other actual realities – and not social justice demands that never get met – why any life sciences company should locate a billion dollar state of the art facility that pays thousands of employees 6 figure salaries in Fort McPherson. They can’t, because those reasons do not exist. If they did, that area would have those sorts of projects coming their way already.
As for “what is the rush” … first of all waiting isn’t going to accomplish anything. It won’t make the community leaders reared on National Action Network and Rainbow/PUSH talking points any more willing to face reality, and it won’t make those blighted, high poverty areas any more desirable to developers, and if you are waiting for the city and state to elect the type of progressive leadership willing to throw hundreds of millions of tax dollars into those areas – which by the way is that these “local communities” really want – well hey just keep waiting and maybe it will happen one day, right?
The truth is that it takes years to find buyers for properties like this and still more to negotiate and finalize a deal. And Kasim Reed only has 3 years left in office. And much of the last year in office is going to be taken up with tying up loose ends and transitioning to the new mayor. Plus Reed has a ton of issues on his plate: the infrastructure referendum, the Turner field issue, the Falcons stadium, the Beltline, the streetcar, the attempt to annex Emory/CDC, plus still more wrangling with the public sector unions over contracts and pensions. So the folks who keep saying “what’s the rush?” are just trying to run out the clock, hoping that Reed will be replaced with another do-nothing mayor that will accommodate their “pie-in-the-sky or cry institutional racism” rhetoric and tactics. Which will result in 20-25 years from now, those areas still being unsold, undeveloped and the “local leaders” still talking about how conspiracies by governments and corporate America are keeping them down.Report
Well written and argued Ms. Saporta (and Mr. Pendered)!
The answer of course to the “what is the rush” is that the Mayor is adopting the “shoot everything that flies” approach to economic development – and he is using a cannon rather than a rifle. Any investor is a good investor, and any project a good project. Subsidize whomever and whatever investment raises its head and “claim everything that falls.” Atlman below is correct on one – and ONLY one point – that it is because the Mayor has only a few years left to claim a legacy and he has a bird in the hand with what presents itself now, regardless of whether it warrants public investment. And the Mayor reveals little taste for rolling up his sleeves and doing the hard work of REAL community development (which includes dealing with those pesky residents who actually ought to be beneficiaries of public dollars).
Good economic development – with community benefit – can be done, contrary to atlman. It just takes a little effort.Report
As one who served in public life and as one who didn’t always get it right I am reminded how hard it is to keep a level head and an open mind in making long term decisions for the city. To those who want to stay level headed there are numerous touchstones to be remembered. The quality of my life has been enhanced by the contributions of thousands of foot soldiers from the American Revolution to the Civil Rights Movement, the Women’s Movement, the Labor Movement, the UN Declaration of Human Rights, the Community Policing movement, the LBGTQ Movement, the Peace Movement, The Student Movement The Garvey Movement….each fueled by the energy and contributions of ordinary people whose opinions mattered then and changed the the world. When the public debate gets tiring or repetitive I heed my parents’ warning to remember the history and those on whose shoulders We stand.Report
Why has ….”Mayor
Reed has been moving full-speed ahead with plans to sell off as much of
the city’s real estate as fast as he can?” To improve the City’s balance sheet ahead of the $250 million bond issuance.Report
Can’t win. Delay approving TAD funds and get accused of holding back funds that could make a positive impact on communties. Put funds out expediently and get asked ‘what’s the rush?’. I think I will err on the side of getting those funds into action.Report
leadbelly I don’t think that’s the major reason – it’s a way to put money in the pockets of Hizzoner and his cronies. Paying off the bond issue is no Hizzoner’s problem – he will be out of office before the big payments begin.
The bond is going to be classed as junk, regardless of adding a pittance to the City’s coffers.Report
Good feedback Anna Foote. It is hard to please everyone when you are in an office like Invest AtlantaReport
I don’t know who you are or if you have participated in any of the Ft Mac community efforts to be heard
Sounds like you may have been on the other sideReport
As I noted when posting to my FB page, good journalists can hold good politicians’ feet to the fire, but a magic godfather can gift asbestos boots for skipping over burning coalsReport
One way for the City of Atlanta to win across all communities is for Atlanta to honor its obligations to the Atlanta Public Schools (APS). The Mayor is moving like General Sherman through the properties and funds of the city to fund pet projects, but for some unknown reason he has drawn a Berlin Wall around meeting its contractual obligations to APS. Given the Mayor’s largesse as outlined in this article, will the City of Atlanta be built on the backs of the public school children of the city – the very children who live in all of our communities and will one day be the citizens who are the foundation of future growth?
It would be exceptional of the Mayor to invest in the human capital of the city – the children – and not just the real estate and development projects. Actually, a better restatement of this would be – it would be exceptional of the Mayor for the City of Atlanta to honor its current financial and contractual obligations to APS even if it elects not to invest in the children of the city.
Mayor Kasim Reed has the choice to meet the City’s legal obligations….and if he chooses not to, then he should plan for the long-term effects of his short-term haste – the Mayor should hold back some of the city’s land to build more prisons. After all, uneducated children with no vocational training or education end up to a lifetime sentence of crime.Report
Abby Martin Hizzoner the Mayor doesn’t control APS, and he wants to fund only things he can control.Report
Well said atlman, I couldn’t have said this better myself!Report