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David Pendered

Atlanta City Council wants some TADs closed to free millions of tax dollars for use elsewhere in city

Twelve Centennial Park provides condo homes, hotel rooms, offices, and retail shops in a building supported by the Eastside TAD, which Mayor Kasim Reed wants to close. Credit: Invest Atlanta via Flickr

By David Pendered

The Atlanta City Council on Thursday made its strongest statement yet that the time has come to declare some urban renewal districts complete so that property taxes collected from them can pay for city services elsewhere in Atlanta.

Twelve Centennial Park provides condo homes, hotel rooms, offices, and retail shops in a building supported by the Eastside TAD, which Mayor Kasim Reed wants to close. Credit: Invest Atlanta via Flickr

Twelve Centennial Park provides condo homes, hotel rooms, offices, and retail shops in a building supported by the Eastside TAD, which Mayor Kasim Reed wants to close. Credit: Invest Atlanta via flickr

The position sets up a potential political confrontation between the council and Invest Atlanta, the city’s development arm that collects management fees by administering Atlanta’s 10 TADs. Property taxes collected in a TAD, or tax allocation district, can be spent only to provide new public amenities in that TAD.

“This is the juice for Invest Atlanta,” said Councilmember Yolanda Adrean. “They take all their administrative charges and they smear them like peanut butter across these 10 TADs. Well, I mean, they [TADs] were designed to be retired. Mission accomplished. Yeah! Close it.”

“We have to pry the special-interest fingers off this money,” said Councilman Howard Shook, who co-chairs Mayor Kasim Reed’s Commission on Waste & Efficiency in Government.

“Understood – message received on all fronts,” Atlanta CFO James Beard said in response to comments from four councilmembers during the council’s first hearing on the mayor’s budget proposal. “We’ll double-down and relook at the TADs.”

TAD is an acronym for “tax allocation district,” which is a geographically defined area that meets the state’s definition of blight. Because of this designation, property taxes collected on new developments in these districts can be steered into public amenities – roads, parks, sidewalks, parking structures – to attract development to that TAD. The money can’t be spent elsewhere.

Atlanta has created TADs to spark renewal in development areas including Atlanta BeltLine, Atlantic Station, the west and east sides of Downtown Atlanta, Princeton Lakes, Campbellton Road, Turner Field, Metropolitan Parkway, and Hollowell/Martin Luther King Jr. Drive.

Atlanta Councilmember Yolanda Adrean

Atlanta Councilmember Yolanda Adrean says the time has come to declare some TADs a success and close them so tax revenues can be used elsewhere.

Adrean recommended having a consultant review Atlanta’s TAD situation and make recommendations – presumably to restructure it.. Adrean’s suggestion was affirmed by Councilmember Joyce Sheperd, who had served for several years on the board of Invest Atlanta and said the council could consider bringing in a TAD consultant who’d impressed her at a recent meeting of the National League of Cities.

Mayor Kasim Reed’s proposed budget was the springboard for the conversation Thursday, during the council’s first hearing on the mayor’s spending proposal for Fiscal Year 2015, which begins July 1.

Reed’s budget proposal would close down the Eastside Tax Allocation District by retiring the debt with the unspent money in its account. The city had issued a total of $47.5 million in bonds for the Eastside TAD, according to a 2012 audit of the account.

The mayor serves as chair of Invest Atlanta, which is Atlanta’s development arm and the entity that is to sell more than $200 million in bonds to help pay for the Falcons stadium. The former CEO of Invest Atlanta, Brian McGowan, resigned to take a job at the Metro Atlanta Chamber.

The sum in the Eastside TAD account is large enough to pay off the debt, which the budget proposal indicates is about $40 million, and return $5 million to the city’s general fund for Fiscal Year 2015, which begins July 1.

Fulton County and Atlanta schools also participate in the Eastside TAD. The amount of money they would receive was not immediately available.

Tension over the city’s TAD program has risen steadily since a 2012 city audit issued by City Auditor Leslie Ward. The audit determined $226 million in TAD proceeds were in city coffers, with no records to indicate if the money was encumbered or available to be spent. Invest Atlanta previously had issued its own review, conducted by the firm HRA, that found at least $68 million in available cash in city accounts. The difference of $158 million may have been earmarked for a use that was known to the consultant but not to city auditors.

Howard Shook, Atlanta City Councilman

Atlanta Councilman Howard Shook says some TADs should be closed as part of the broader effort to manage Atlanta more efficiently.

In 2013, the council called for Invest Atlanta to provide monthly reports on the incentives it offers businesses to locate in the city. The council acted after Invest Atlanta offered more than $2 million in incentives in just the month of June 2013.

On Thursday, Beard framed the emerging controversy in a lengthy response to remarks by the four councilmembers – Adrean, Shook, Sheperd, and Finance Committee Chairman Alex Wan.

Beard said:

  • “The issue becomes one of, let’s call it divergent interests. Obviously there’s a group of people who want to keep the TAD in place and do a lot of projects within that particular area.
  • “Versus, the general consensus of finance [department officials] to bring the TADs back into the general fund stream.
  • “There are various conversations that are taking place between Invest Atlanta, law [department], finance, and a few others to kind of flush through that. Hopefully in the next two weeks we’ll have one page about what can and can’t happen from a legal standpoint and a finance standpoint.
  • “Politics, I just try to avoid that at all costs.”

Shook responded with a lengthy comment that included the notion that the Commission on Waste & Efficiency in Government is looking for annual savings in the range of $75 million:

  • “We don’t have the luxury of avoiding the politics, but we have to understand the players. Right now, I can only make educated guesses about that. I want to flush everybody out of the tall grass and have them sit at a table so we can have a frank discussion.
  • “It needs to be a two-part discussion: First, we have to understand what the law says, we have to understand the financial implications. But then the second part is people have to inform us, as the clients here, about such recommendations as may be made to work around what come out of these discussions as problems or obstacles….
  • “You have to put trust in somebody at some time. We’re not going to get there without you guys [finance department] and law.
  • “We have to pry the special-interest fingers off of this money. If we can’t realize saving out of these TADs, you realize what these efficiency commission’s recommendations are going to have to be to find $75 million?
  • “It’s going to be headcount, headcount, headcount, headcount.”

The council’s next budget hearing is scheduled for May 6 at Atlanta City Hall.

David Pendered

David Pendered, Managing Editor, is an Atlanta journalist with more than 30 years experience reporting on the region’s urban affairs, from Atlanta City Hall to the state Capitol. Since 2008, he has written for print and digital publications, and advised on media and governmental affairs. Previously, he spent more than 26 years with The Atlanta Journal-Constitution and won awards for his coverage of schools and urban development. David graduated from North Carolina State University and was a Western Knight Center Fellow.


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  1. James R. Oxendine May 4, 2014 12:44 pm

    title and thrust of the article is misleading and omits some important facts
    and as a result, grave damage may occur to the City of Atlanta’s most recent
    plans for the redevelopment of downtown at a time when competitors
    like Dallas are focusing enormous amounts of resources to attract investment to
    their downtowns.

    4 councilmembers do not constitute the Atlanta City Council nor do they
    even constitute a majority of the 15 member body. Second, only
    1 of the Councilmembers quoted in the article represent a district that
    has a TAD and the TAD she district she represents has been recommended for
    closure by Invest Atlanta. Third, the audit which the Council called for last
    year did not find any evidence of Invest Atlanta” is the juice for Invest
    Atlanta,” said Councilmember Yolanda Adrean. “They take all their
    administrative charges and they smear them like peanut butter across these 10

    Eastside TAD was created in 2003 ” {in order to} create incentives
    for new Downtown housing and attract the critical mass of permanent residents
    needed to make Downtown a vibrant 24-hour activity center.”  A brief
    analysis of the Eastside TAD would find that it encompasses Auburn Avenue and
    Edgewood, Underground Atlanta and portions of the Peachtree corridor in
    downtown. Some of the notable projects accomplished through the Eastside
    TAD include the Atlanta Housing Authority’s Grady Homes and Capitol Homes
    into viable mixed-income communities and a portion of the funding for the retail
    pop up program along the Atlanta Streetcar route. Proposed projects include,
    but are not limited to, founding the Atlanta Streetcar to the Beltline at
    the Eastside Trail and providing incentives to the purchaser of Underground

    critical issue in this story is the implied outcome of the closure of the
    Eastside TAD. After closing costs; related expenses and distribution of the
    proceeds of the bond defeasance, the net to the City of Atlanta would be less
    than the $ 5 million stated amount. Moreover, if the city refinanced the
    bounds, it could gross several times the $ 5 million and still retain the
    important tool for the future growth and development of downtown Atlanta at a
    time when there is considerable momentum for the development of a 24 hour,
    vibrant center city.

    The story outlines some opinions
    from a small minority of councilmembers who do not represent a TAD district and
    may not be the strongest supporters of the redevelopment of downtown Atlanta or
    affordable housing. The story also does not balance out the need for
    fiscal accountability with the competitive environment of the global economy
    regarding vibrant, 24 hour city centers and how Atlanta plans to meet that
    challenge. Finally, the story appears to be part of a consistent and persistent
    line of thinking that casts certain programs and personalities in a less than
    flattering matter without a fair and balanced analysis of the context of the
    discussion or the facts. As a famous American once said: “You are entitled to your
    own opinion but you are not entitled to your own facts”.Report

  2. James R. Oxendine May 4, 2014 3:12 pm

    Clarification: Of the 3 councilmembers who directly supported closing the Eastside TAD, only one had a TAD in her district.Report

  3. Brian Debonamour May 5, 2014 12:22 pm

    I’ll translate Mr. Oxendine’s comments for you:
    My friends and I make a lot of money from TADs so leave them alone.Report

  4. James R. Oxendine May 5, 2014 4:17 pm

    Brian Debonamour
    Mr. Pendered’s  opinion  editorial contained some factual errors including, but limited to, the title. I expressed my issue with the story as written and offered some factual information that Mr. Pendered had or should have access to, as a rebuttal. I am a proud resident of Atlanta and in the past have been privileged to serve on several civic and business projects that sought to bring community and economic advancement to our great city.
    I stand by my comments, however, if I have somehow offended  you or any of your friends, please accept my apologies.Report

  5. urban gardener May 6, 2014 10:10 am

    Back in the day, it was widely discussed that the Eastside TAD was not on the up and up, that massive developments already underway were roped in under the TAD – completely contrary to the rules establishing TADs, such as Lindburg redevelopment by MARTA and City Hall East. But no matter the original slight of hand that was by no means slight…
    No where is it discussed how much money ADA / Infest Atlanta / COA owes APS/ABOE, nor any inkling of a timeline of when those arrears payments will be made.
    Mr. Pendered – would you please elaborate?Report


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