Atlanta’s development arm exerted control over BeltLine through revised bylaws months before CEO ousted
By David Pendered
Five months before Brian Leary was released as president/CEO of Atlanta BeltLine, Inc., the agency’s bylaws were changed in ways that expanded the autonomy and authority of his position to spend public money.
This change is minor compared to other, much more significant revisions of the bylaws. Taken as a whole, the revised bylaws represent a fundamental shift in the governance of the BeltLine – Atlanta’s primary urban renewal project.
The BeltLine is now governed by a board that’s appointed by the city and its development arm, Invest Atlanta. Two boards approved the restated bylaws: The board that oversees Atlanta BeltLine, Inc. voted for the revisions in March; and the board that oversees Invest Atlanta, the city’s development arm, voted for them in April.
Atlanta Mayor Kasim Reed chairs the board of Invest Atlanta and has a seat on the board of Atlanta BeltLine, Inc. The current chair of Atlanta BeltLine, Inc., AGL Resources Inc. CEO John Somerhalder, said in June that he took the position of BeltLine chairman at the behest of the mayor.
Somerhalder succeeded Elizabeth Chander, who served as Atlanta’s city attorney during the Shirley Franklin administration. Chandler now serves as vice chair of Atlanta BeltLine, Inc., and Somerhalder retained his seat on the private sector’s Atlanta BeltLine Partnership, Inc.
The changes in the bylaws of Atlanta BeltLine, Inc. are so expansive that the title page of the new document says it replaces, in their entirety, the initial bylaws approved in 2006.
A central theme in the new bylaws is Invest Atlanta’s reach to strengthen its authority over Atlanta BeltLine, Inc. Back in 2006, the stated goal of incorporating Atlanta BeltLine, Inc. was to create a stand-alone, non-profit corporation that would be nimble in implementing the BeltLine’s strategic vision.
Gone is the veil of independence that’s stated in the Atlanta BeltLine, Inc.’s initial articles of incorporation. One section of the old bylaws reads:
- “The corporation shall not be limited in its capacity of service to ADA, but shall have full power and authority to engage in charitable and/or public programs and activities on behalf of and for the benefit of ADA or the City.” (Article 3, Sect. e).
The expanded authority of the president/CEO seems to be in keeping with this spirit of quick action.
The position was granted authority to take the following actions without any prior approval: Spend up to $250,000, an increase from the previous spending cap of $100,000; increase compensation for board-approved contracts by up to 10 percent; sell real estate and buy it – if the money is available in the budget.
Meanwhile, there was no change to a portion of the bylaws concerning the staff’s expenses on behalf of Atlanta BeltLine, Inc. The section states that the board may hire a president/CEO and other officers and to, “pay reasonable compensation for the services performed and expenses incurred by any such person or persons.”
Leary was released Aug. 17 following a city audit in May that detailed questionable expenses by BeltLine managers, along with a host of managerial issues involving Invest Atlanta’s handling of the city’s main urban renewal tool, called tax allocation districts.
The new bylaws make it clear that Atlanta BeltLine, Inc. is to act solely on behalf of the Atlanta Development Authority (which remains the legal name of the city’s development arm, though it now does business as Invest Atlanta).
Crucially, the restated bylaws give complete control of Atlanta BeltLine, Inc. to the city and Invest Atlanta. A majority of board members will serve by virtue of their position with the city or by appointment by Invest Atlanta.
Previously, the board of Atlanta BeltLine, Inc. was authorized by the Articles of Incorporation to admit members on terms based generally on its own judgment. The number of members was not mentioned in either the Articles of Incorporation or the bylaws.
Now, the bylaws state that the board of Atlanta BeltLine, Inc. shall consist of no more than nine members, “the majority of which shall be appointed by ADA and the city.”
The nine-member board now is to consist of five agents who represent the city:
- The mayor; chair of the Atlanta City Council’s Community Development Committee, who also serves on the ADA; president of ADA or a suitable replacement; a business person chosen by the ADA; a community representative chosen through a process established by the city council, who must be approved by the ADA.
The other four members are comprised of:
- Two members appointed by the board of Atlanta BeltLine Partners, Inc., which handles fund-raising efforts to bolster the BeltLine; a representative appointed by the Atlanta Board of Education; a representative appointed by Fulton County Board of Commissioners.
The revised bylaws were presented to the board of Invest Atlanta in a way that appears to be more a house-keeping matter than a significant shift, according to minutes of the April 19 meeting of Invest Atlanta’s board. The board unanimously approved the proposal as presented by Veronica Burroughs:
- Atlanta BeltLine, Inc. is no longer required to be located in the headquarters of Invest Atlanta;
- Invest Atlanta no longer will ratify the community representative to Atlanta BeltLine, Inc.;
- Term lengths were created for all officers;
- The executive committee of Atlanta BeltLine, Inc. has full authority to act on behalf of the board;
- All committees of Atlanta BeltLine, Inc. shall have at least one member appointed by Invest Atlanta;
- Invest Atlanta must be notified on any proposed changes to the bylaws of Atlanta BeltLine, Inc.