Category Archives: Tax Allocation District

A rendering of the redevelopment at the site of the former GM plant near I-285 and I-85.
Earlier this month WABE 90.1 took a Closer Look with DeKalb School Board Chair, Dr. Melvin Johnson, at the financing of the GM Plant site.
In “TAD Talk“, Commissioner Nancy Jester characterized the interview as striking because of the blatantly false statements made by the Chair of the Board or Education and his refusal to understand the basics of school finance, how a TAD works, and the financial realities of the project.
A few days ago WABE 90.1’s Martha Dalton and Rose Scott took a Closer Look with Egbert Perry and Eric Pinckney,  developers of the Doraville GM Plant site.  Here is an excerpt:
Rose Scott (Cohost of WABE 90.1 Closer Look) – Straighten some of that out for us.  What do you think has been misrepresented?
Egbert Perry (CEO of The Integral Group) – No one is asking the school board or any other jurisdiction to fund this project.  This project was bought 100% with private dollars.  All of the vertical development, and infrastructure within the footprint of the project that is private, will be funded with private dollars.
We are asking to use a tool that has been used 10,000 times or more successfully across the country to fund public infrastructure.  That is roads, public utilities, public parks, a connection to transit.  People think the site is connected to transit.  It’s close to transit, but to get there you have to drive in a car a mile to get to it even though the transit stop is just across the tracks.
That’s what the funding is for.  It doesn’t make its way to the developer.  There’s no mechanism by which we would ever get a penny of those dollars.  That has not been made clear.  There has been a lot said to suggest that this is funding a private project or developer.  That’s not legally possible and an important clarification.
Rose Scott/Marth Dalton – I haven’t heard anyone from the school board say they have questions about where the money will go, it’s more of a question the money is coming from the school district.  Can you understand that argument?
Egbert Perry – Absolutely not.  At this time, the school board collects a few hundred thousand dollars every year from the GM site.  They have gotten that year in and year out for 8+ years the site has been sitting undeveloped.  It’s undeveloped because of the absence of public infrastructure.
What the TAD does is allow you to use your vision of what you can do with the site to fund public infrastructure using private dollars, but all of the increase in taxes that you create first go to repay for that public infrastructure that was funded.
Then the school system, the city and the county start to receive windfall profits because of new tax revenues  that have been generated by the development.  So, the development is what is generating the dollars to fund the public infrastructure.
At no time does the school board ever reach into its pockets or coffers to fund anything.  All it has is upside, it just delays how soon the upside kicks in because the infrastructure has to be funded before the nets start to flow to the district.
You can read the entire transcript here >>

Related Posts and Docs
 FactChecker Reviews Chairman Johnson on the TAD
  TAD Talk By Commissioner Nancy Jester
  Transcribed Interview of Dr. Johnson on WABE
  TAD – Q&A – Open Discussion
  Doraville Tax Allocation District
  DeKalb Schools – Not a Fan of the TAD
WABE 90.1 CLOSER LOOK
05/03/2016 – Dr Johnson – TAD
5/10/2016 Egbert Perry And Eric Pinckney
5/9/2016 Nancy Jester

This coming week, Superintendent Dr. Green is providing an opportunity for no more than 3 board members at a time to attend mini-sessions with the administration and Legal for the purpose of providing details of TADS and the Doraville IGA.
  Intergovernmental Agreement (IGA) with Doraville and DeKalb County
  Doraville TAD Bleakly Report (outlines the rationale, boundaries, fiscal data and potential projects for the TAD)

What is a TAD?

A Tax Allocation District (TAD) is a financing mechanism in Georgia that allows a community to “allocate” increases in taxes generated by new development within a defined area to pay for capital improvements to that area.  No taxes collected from any other area or resident can be used to fund any improvement within the TAD.  Only incremental tax revenues from the TAD site can be used in the TAD area.

• County and School District taxes can also be allocated IF those jurisdictions consent to participate in the TAD
• TAD funds can be used for roads, infrastructure, parking structures and other public improvements to attract/support development

Creating a TAD does not directly impact existing taxpayers:

• Existing property owners within and outside the TAD are taxed in the same manner as if the TAD did not exist
• All taxes from properties within the TAD continue to be collected
• Taxing authorities involved in the TAD (City, County and school district) continue collect taxes at the level that existed when the TAD was created

How Does A TAD Work?

Future property taxes paid by new development and future value growth within the TAD are allocated to a special fund to pay for eligible costs–i.e. increased tax revenue generated by the TAD is spent in the TAD.
TAD funds can be used to pay debt service, match other funding or spend on a pay-as-you-go basis.
No existing taxpayers are affected and no taxes are abated – revenue to repay costs comes from new taxes on new investment.
Only taxes on real estate are typically pledged in a TAD. Taxes on personal property, sales taxes, business licenses and other local government revenues are not affected