City of Atlanta pays APS $9 million as they move towards resolving BeltLine dispute

By Dave Williams and Maria Saporta

The city of Atlanta paid Atlanta Public Schools $9 million last week in an important step toward resolving a long-running legal dispute over tax allocation district revenues from Atlanta BeltLine Inc.

Word of the payment emerged Monday from a source close to the negotiations as the Atlanta City Council met behind closed doors for more than an hour to discuss an issue of “potential litigation,” in the words of council President Ceasar Mitchell.

The Atlanta BeltLine

The Atlanta BeltLine – future transit guideway (Photo by Ryan Gravel – 2015)

For a time on Monday it appeared that the city and APS might reach a tentative agreement that could be presented to the Atlanta City Council and Atlanta Board of Education. But after council members emerged from their executive session, nothing was said about the talks with APS during the remainder of the meeting.

“I think progress is being made, and the parties are working in good faith,” Mitchell said late Monday after the meeting.

Earlier on Monday, APS board Chairman Courtney English described a potential agreement that would involve the city making a schedule of payments to the school system.

But he said nothing would be final until the Atlanta school board signs off on the deal.

“The City of Atlanta, Invest Atlanta, Atlanta BeltLine and Atlanta Public Schools are all working diligently to resolve the BeltLine dispute, and we remain cautiously optimistic that settlement will be reached very soon,” City Attorney Cathy Hampton said in a statement issued late Monday afternoon. “Ending the dispute will benefit APS students and all of Atlanta’s citizens.  The $9 million payment demonstrates our commitment to finalizing a resolution as quickly as possible.”

The BeltLine payment issue has caused tension between the city and its public school system for nearly three years. It has had a ripple effect in preventing other collaborations, such as the selling of school properties Atlanta holds the deeds to.

It is not known whether this agreement would address the sale of school-owned property, but it would be seen as removing a major impediment that caused a rift between Mayor Kasim Reed and APS leaders.

English said he is not surprised the legal dispute has dragged on for so long.

“It’s hard,” he said. “It’s really a complex issue that has a ton of moving pieces.”

The $9 million payment was significant because several people close to the situation said the city was scheduled to make its next payment to APS by the end of the year. The city was behind in its payments because it believed the amount of taxes called for in a long-standing agreement between the parties was not reasonable when considering the economic impact of the real estate recession.

APS said it was an agreement the city should honor and that it needed those revenues to run the school system.

Dave Williams is a reporter with the Atlanta Business Chronicle.

Maria Saporta, Editor, is a longtime Atlanta business, civic and urban affairs journalist with a deep knowledge of our city, our region and state.  Since 2008, she has written a weekly column and news stories for the Atlanta Business Chronicle. Prior to that, she spent 27 years with The Atlanta Journal-Constitution, becoming its business columnist in 1991. Maria received her Master’s degree in urban studies from Georgia State and her Bachelor’s degree in journalism from Boston University. Maria was born in Atlanta to European parents and has two young adult children.

7 replies
  1. Phil Lunney says:

    I would like to see 1 or 2 of the school properties turned into Senior housing for those who will be displaced as real estate values escalate. This could be administered under Metropolitan Tech and the Technical College System of Georgia and used as a training ground for urban laborers and teenagers in transition. We have seen what projects like the Beltline and a good economy can do for Atlanta, let’s move forward and bring along those already here.Report

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  2. InfraredGuy says:

    The ” deal ” to the APS is take this or leave it. The APS knows they are getting screwed but have no other choice. The City knew the Beltline TAD was a overreach on revenue and the City knew it back in 2009 after the recession had already hit.  TADS are to benefit two groups of people, Politicians and Developers, the Public be damned. A 25 year tax freeze in the TAD district does not mean that School and County services are going to be static those 25 years, it is a classic example of a ” Stealth Tax ” on all the City residentsReport

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  3. Bill S says:

    Maria, can you confirm where this $9M came from? Did it come from the General funds of the COA, the reserve funds of the COA or from the BeltLine TAD? I would assume the BeltLine has not been saving/reserving these $’s for future payments…thus if it did come from the COA, then that is a departure from the project planning. I have more questions but they are really addressed at if the funds came from the City instead of the TAD.Report

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  4. Bill S says:

    InfraredGuy   That is why their are PILOT payments.  These are to supplement the base tax as it was frozen on day 1 of the TAD formation.  The project will bring a very large waterfall of future property taxes (which can be bonded against) after the TAD, large sales taxes and occupancy taxes.Report

    Reply

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