While the School District is not a Fan of the TAD, the Doraville City Council and the DeKalb County Commissioners passed the TAD unanimously. There seems to be a lot of confusion about what a TAD is and how it works. DeKalb County Commissioner Nancy Jester addresses some of the confusion.
DeKalb Schools – Not a Fan of the TAD
Intergovernmental Agreement (IGA) with Doraville and DeKalb County
Doraville TAD Bleakly Report (outlines the rationale, boundaries, fiscal data and potential projects for the TAD)
Doraville Tax Allocation District
By: Nancy Jester, DeKalb County Commissioner
December 18, 2015 – At this Tuesday’s Board of Commissioners’ meeting, the Board approved an Intergovernmental Agreement (IGA) with Doraville regarding the Tax Allocation District (TAD) for the former GM Plant site. The Commission approved the TAD earlier this year. The IGA sets forth how the TAD will function and sets out the infrastructure improvements that can be financed by TAD revenues.
So, what is a TAD? How does it work?
A TAD is a defined area where real estate property tax monies gathered above a certain threshold for a certain, finite period of time, can be used for specified improvements in the defined area.The property taxes collected by all governmental entities (city, county, and/or school district) that participate in the TAD continue to be paid to those entities. The TAD does not decrease or abate taxation on this property. As improvements are made and development occurs on the property, its value will increase. The tax that is paid on the increase in the value, gets paid, and accrues into the TAD account. Those funds can only be utilized pursuant to the Intergovernmental Agreement (IGA) that designates the projects for which TAD funds can be used.
Let me be clear: Every dime of property taxes for this property must be paid. The TAD does not change that. The taxes that are paid today on that property will continue to be paid directly to the city, county, and school district. The taxes assessed on the increase in value of the property, also have to be paid. They go directly to the TAD for specific, pre-approved, directed uses.
The IGA that the Commission approved on Tuesday has numerous stipulations about TAD expenditures. They include a new fire station, water/sewer infrastructure, streets, and storm water management structures. The TAD is set for a period of 25 years but DeKalb has built in a review and reauthorization provision at the 10 year mark.
I want to contrast the TAD and this process with the powers of Development Authorities. Development Authorities routinely discount or abate property taxes all together for a period of time through bond-lease transactions. When Development Authorities do this, the private, business interest sees their taxes reduced or eliminated. The decision is made by an appointed board; not your elected officials. Development Authorities have the power to abate taxes for cities, counties, and the school district without approval from these entities. This just recently happened in Brookhaven when the DeKalb Development Authority (known as Decide DeKalb) entered into a deal to build a new office building at Perimeter Summit. Click here to read about it. The soccer deal was structured with the Development Authority as a tax abatement deal and a cash give away. A TAD is none of these things.
With the TAD, every dime in taxes gets paid, and your elected officials have to approve of the TAD and its expenditures. Development Authority deals mean unelected officials get to eliminate taxes for private interests.
The General Motors property has languished for the better part of a decade. There have been a few attempts to redevelop it over the years but the deals have never come to fruition. Even though General Motors went through bankruptcy reorganization, the Doraville Plant was not liquidated. The plant closed and has been sitting there for over 7 years. The site has such infrastructure deficits and GM demanded such a premium price that any development would need some form of public participation.
The business community and investors have expressed their concerns about DeKalb’s business climate. The GM site redevelopment is one of the largest projects in the Southeast. Successfully redeveloping this area will improve DeKalb’s reputation, bring thousands of jobs to the area, and improve land value; resulting in a larger commercial tax base for everyone.
I have been disappointed to hear some of the comments from the school system about this project. Perhaps more than any other governmental entity, DeKalb School District, contributed to the distress and blight in Doraville. For years, the school district ignored the burgeoning student population and now the schools in and near Doraville have proliferated with trailers. The district as a whole is a negative when businesses are considering where to locate in metro Atlanta. It is ironic that the school district does not appear willing to participate in a revitalization given its history of willfully ignoring the area.
TAD participation by the school district would lead to higher collections of e-SPLOST sales taxes. The district could negotiate for the building of an auditorium large enough to hold graduations with their portion of the TAD. Right now, no such space exists in DeKalb.
I also find it ironic that DeKalb schools would hinge their disdain for this project on their view that “teaching and learning” is their “core business”. A quick glance of the school district’s budgets over the years would show you that DeKalb has failed to ever meet the state’s mandate of spending 65% (at a minimum) of the their budget in the classroom (on “direct instructional expenditures”). I suggest that to be credible in making a statement about the core business of DeKalb County schools, start first by using the taxpayers’ money for what it is intended. Keep in mind that DeKalb has one of the highest millage rates for schools in the state at 23.73 mils. Almost all other districts are capped and can go no higher than 20 mils. Even with almost 4 mils more in taxes, DeKalb School District can’t get 65% of the budget to be spent on their “core business. The old adage – “You get what you pay for” – shows us that more money into the school’s coffers have purchased something far different than “teaching and learning”.
In the School District’s critique of this TAD, they mentioned the Kensington and Briarcliff TADs and noted that their value has decreased. Indeed the value has decreased and so the TAD has seen no accumulation of funds and so there have been no infrastructure improvements or redevelopment. The cost to the taxpayer has been zero. And all the while, every tax dollar has been paid because TADs do not eliminate taxes and money only accumulates in a TAD when the value goes up.
The old GM site represents a unique opportunity for DeKalb. Unfortunately, this property wasn’t liquidated when taxpayers footed the bill for General Motors to reorganize. We were left with a property that GM held without compromising on price. Now, we have the opportunity to redevelop this site to benefit all of DeKalb, increase the commercial tax base, provide jobs, and show that DeKalb wants to be a business friendly place. We have the opportunity to make sure the necessary infrastructure and school facilities get put in place. We have the opportunity to show that DeKalb is open for business. We can take the opportunity, mitigate risk to the public, and improve value for all the taxpayers. Let’s do this and show that DeKalb is united and a great place to do business.
So, what is a TAD? How does it work?
A TAD is a defined area where real estate property tax monies gathered above a certain threshold for a certain, finite period of time, can be used for specified improvements in the defined area.The property taxes collected by all governmental entities (city, county, and/or school district) that participate in the TAD continue to be paid to those entities. The TAD does not decrease or abate taxation on this property. As improvements are made and development occurs on the property, its value will increase. The tax that is paid on the increase in the value, gets paid, and accrues into the TAD account. Those funds can only be utilized pursuant to the Intergovernmental Agreement (IGA) that designates the projects for which TAD funds can be used.
Let me be clear: Every dime of property taxes for this property must be paid. The TAD does not change that. The taxes that are paid today on that property will continue to be paid directly to the city, county, and school district. The taxes assessed on the increase in value of the property, also have to be paid. They go directly to the TAD for specific, pre-approved, directed uses.
The IGA that the Commission approved on Tuesday has numerous stipulations about TAD expenditures. They include a new fire station, water/sewer infrastructure, streets, and storm water management structures. The TAD is set for a period of 25 years but DeKalb has built in a review and reauthorization provision at the 10 year mark.
I want to contrast the TAD and this process with the powers of Development Authorities. Development Authorities routinely discount or abate property taxes all together for a period of time through bond-lease transactions. When Development Authorities do this, the private, business interest sees their taxes reduced or eliminated. The decision is made by an appointed board; not your elected officials. Development Authorities have the power to abate taxes for cities, counties, and the school district without approval from these entities. This just recently happened in Brookhaven when the DeKalb Development Authority (known as Decide DeKalb) entered into a deal to build a new office building at Perimeter Summit. Click here to read about it. The soccer deal was structured with the Development Authority as a tax abatement deal and a cash give away. A TAD is none of these things.
With the TAD, every dime in taxes gets paid, and your elected officials have to approve of the TAD and its expenditures. Development Authority deals mean unelected officials get to eliminate taxes for private interests.
The General Motors property has languished for the better part of a decade. There have been a few attempts to redevelop it over the years but the deals have never come to fruition. Even though General Motors went through bankruptcy reorganization, the Doraville Plant was not liquidated. The plant closed and has been sitting there for over 7 years. The site has such infrastructure deficits and GM demanded such a premium price that any development would need some form of public participation.
The business community and investors have expressed their concerns about DeKalb’s business climate. The GM site redevelopment is one of the largest projects in the Southeast. Successfully redeveloping this area will improve DeKalb’s reputation, bring thousands of jobs to the area, and improve land value; resulting in a larger commercial tax base for everyone.
I have been disappointed to hear some of the comments from the school system about this project. Perhaps more than any other governmental entity, DeKalb School District, contributed to the distress and blight in Doraville. For years, the school district ignored the burgeoning student population and now the schools in and near Doraville have proliferated with trailers. The district as a whole is a negative when businesses are considering where to locate in metro Atlanta. It is ironic that the school district does not appear willing to participate in a revitalization given its history of willfully ignoring the area.
TAD participation by the school district would lead to higher collections of e-SPLOST sales taxes. The district could negotiate for the building of an auditorium large enough to hold graduations with their portion of the TAD. Right now, no such space exists in DeKalb.
I also find it ironic that DeKalb schools would hinge their disdain for this project on their view that “teaching and learning” is their “core business”. A quick glance of the school district’s budgets over the years would show you that DeKalb has failed to ever meet the state’s mandate of spending 65% (at a minimum) of the their budget in the classroom (on “direct instructional expenditures”). I suggest that to be credible in making a statement about the core business of DeKalb County schools, start first by using the taxpayers’ money for what it is intended. Keep in mind that DeKalb has one of the highest millage rates for schools in the state at 23.73 mils. Almost all other districts are capped and can go no higher than 20 mils. Even with almost 4 mils more in taxes, DeKalb School District can’t get 65% of the budget to be spent on their “core business. The old adage – “You get what you pay for” – shows us that more money into the school’s coffers have purchased something far different than “teaching and learning”.
In the School District’s critique of this TAD, they mentioned the Kensington and Briarcliff TADs and noted that their value has decreased. Indeed the value has decreased and so the TAD has seen no accumulation of funds and so there have been no infrastructure improvements or redevelopment. The cost to the taxpayer has been zero. And all the while, every tax dollar has been paid because TADs do not eliminate taxes and money only accumulates in a TAD when the value goes up.
The old GM site represents a unique opportunity for DeKalb. Unfortunately, this property wasn’t liquidated when taxpayers footed the bill for General Motors to reorganize. We were left with a property that GM held without compromising on price. Now, we have the opportunity to redevelop this site to benefit all of DeKalb, increase the commercial tax base, provide jobs, and show that DeKalb wants to be a business friendly place. We have the opportunity to make sure the necessary infrastructure and school facilities get put in place. We have the opportunity to show that DeKalb is open for business. We can take the opportunity, mitigate risk to the public, and improve value for all the taxpayers. Let’s do this and show that DeKalb is united and a great place to do business.
“Extremism in defense of liberty is no vice. Moderation in pursuit of justice is no virtue.”
With all due respect to Nancy, the DeKalb School System should not be involved in the redevelopment of the Doraville GM property. I am surprised that Nancy, a former DeKalb School Board of Education member during the school districts’ devastating financial crisis, one which she herself played a part in bringing to light, would support using money earmarked for education, on a risky real estate venture. And yes, it is risky. Does the GM plant redevelopment have any committed partners? Other than the 2 new automobile dealerships moving to that property in 2016, I don’t see anything other than “pie in the sky plans”.
One only has to look to the APS/Beltline fiasco to see how badly this could go. The school system is just beginning to get back on its feet financially and there should be no decisions that would threaten the financial recovery.
Nancy states: I also find it ironic that DeKalb schools would hinge their disdain for this project on their view that “teaching and learning” is their “core business”. A quick glance of the school district’s budgets over the years would show you that DeKalb has failed to ever meet the state’s mandate of spending 65% (at a minimum) of the their budget in the classroom (on “direct instructional expenditures”).
Why does Nancy find it “ironic” that Dr. Green states that the focus of the school district is “teaching and learning”? That is, and should always be the ONLY focus of a school district. Let’s give Dr. Green time with which to prove his statement before saddling him with the reputation of past failed DCSS administrations.
In my opinion, participation in the Doraville TAD should be an easy “No” decision for DCSS.
Paula,
The School District should be primaririly (90% +) concerned with Teaching and Learning. It should also be concerned with the health and prosperity of the County it educates too.
If the TAD was foolproof idea bringing prosperity to all in the County and without any potential for loss or damage to the School District, I would favor it. It is not, it is risky. I support Dr. Green.
The City of Dunwoody and the City of Brookhaven are getting far more revenues from its commercial properties (built and financed by the unicorporated County residents in the 70’s, 80’s, and 90’s) than unincorporated Dekalb is getting.
So basically, nothing changes as far as tax collections go for the school district. Without the TAD, the area would probably not develop as vibrantly if at all. It looks as if Dr. Green is hoping that ‘someone’ will just come on in and develop the site without any kind of public support. That’s probably never going to happen. So let’s all support this development, rather than letting it sit there and cause yet more blight to a county full of blighted areas. After the agreed number of years, the school tax collections will get a very big boost if all goes well with the development. The only options here are that in the future, the tax collections will increase exponentially or they will stay the same. The school district won’t ‘lose’ anything.
Stan,
I apologize for the name calling. I will try to explain the “war on public school teachers” in the Pay Raises for Teachers Thread.
Paula, I don’t know how “Jeb” got onto my computer. There is no “Jeb” here.
I am disappointed with the tone of Nancy’s post. She lessens her argument with all the negativity.
The paragraph beginning with “I also find it ironic that DeKalb schools would hinge their disdain for this project on their view that “teaching and learning” is their “core business” refers to previous administrations. Also, I don’t see Dr. Green’s desire to study the TAD as disdain. I prefer a leader who is not bullied into making rash decisions.
Nancy raises some valid points, but the negativity is aimed at previous administrations. I share many of those opinions and understand Nancy fought against the misallocation of money and the poor policies which have led to the current state of the school district. She has a right to be bitter, about the past.
However, it is very clear the school district is moving in a new direction. Dr. Green is working hard to correct the flaws and build a culture of excellence. Please, do not criticize him for responding intelligently when the response isn’t what you want to hear.
Perhaps it would be better to question why the developer waited until Nov. 20, to approach the school district when the TAD was approved by Doraville in July? If approval from the BOE is critical to the redevelopment moving forward, why delay, then criticize? The agenda for the December BOE meeting had already been set. The superintendent can not approve the TAD. In reality, not the political/media world, the January 11, BOE meeting is the first opportunity for the TAD to be discussed. It is only political rhetoric to say the school district is obstructing, or holding up, the project as Fran Millar did.
Nancy could have written the same post without all the negativity and it would have been more convincing.
Would it be possible for the school district to receive some land in exchange for their support? It would seem that overcrowding situation with the Cross Keys cluster could benefit long term from such a deal. The lack of adequate athletic facilities for the county could be addressed as well.
For those that support the proposed TAD, if the proposal is awesome and the developer states that “something smaller” would have to be done without DCSD participation, what’s wrong with that? Can’t proving out a smaller TAD lead to approving a bigger TAD? Surely the big money smart guys and gals at Integral know they can win small and then big, too. Why are elected officials presenting it as all or nothing when Integral is implying otherwise?
Kirk: “If approval from the BOE is critical to the redevelopment moving forward, why delay, then criticize?” This is a tried and true method for raising the political stakes. It was a very deliberate and highly public way of focusing attention and pressure on the decision-makers who might be inclined to oppose you. I used it on my child toddler all the time – the pressure is on, what you going to do right here in front of God and everyone else? Poor kid, right? Hello, DFACS?
Agree or disagree with his rationale, Dr. Green calmly and without hesitation or malice that I could detect said, “no, thank you.” I respect that on its own merit.
PatW: Regarding land swap for participation, yes, but that presumes DCSD feels short of capital and they do not. That is, I think, partly the explanation for Rep. Taylor’s response at the House to attack DCSD treasure from another angle. “So, you don’t want to invest in our deal, eh? Got too much money to be bothered, eh? We’ll see, we’ll about that!”
I see it as all fairly out in the open. Either that or my herbal supplements from Nuts’n’Berries have more herb than I bargained for!
The projects built with TAD monies are predefined. The school district can negotiate to put projects they want on there.
That is where my problem lies. The school district wasn’t given an opportunity to negotiate before being labeled as obstructionist. If the developer wants to negotiate with the school district, he should start the process.
Why do you say that? I have an email dating back to June 2015 inviting DeKalb Schools to discuss the TAD …
Sent: Thursday, June 11, 2015 11:00 AM
“The City just wrapped up a Redevelopment Plan for a GM area TAD, and Mayor Pittman, myself and the Integral team would like to set up a meeting to go over the plans for the GM redevelopment and the findings of the Redevelopment Plan. “
How did Thurmond and the BOE respond?
I wasn’t involved in any subsequent correspondence. Dr. Green did tour the GM Plant site on Nov 12, 2016.
You can spin it, commissioner. All you get is dizzy. It’s a pipe dream…schools don’t deserve even a connection to it. I’m surprised you are promoting it.