ATLANTA - Atlanta will proceed toward selling bonds to fund the delayed BeltLine project now that a Superior Court judge late last month validated the sale of up to $120 million of bonds.
The city has said it will sell the bonds through the Atlanta Development Authority by the late summer or early fall. The Atlanta City Council last year authorized the negotiated sale of the tax allocation district bonds for the BeltLine, to be sold in one or more series. The underwriters are Wachovia Bank NA, Jackson Securities LLC, and SunTrust Capital Markets, according to the ordinance the council approved this year.
Meanwhile, the city's chief financial officer Janice Davis last week announced that she will resign as of July 9. Davis, who has been in office for her position since 2004, announced that she will be leaving it to pursue an opportunity in Texas. No further details were available Friday.
Her resignation comes as the city faces a budget shortfall of $140 million. Because of the shortfall some residents have questioned whether the BeltLine projects are essential and if any borrowing should be done for such things at this time. Mayor Shirley Franklin's office did not comment on Davis's resignation. Davis did not return phone calls.
The executive director of the Fulton County Taxpayer's Commission has spoken out about Atlanta's handling of its finances. Barbara Payne, the executive director of the commission, did not comment about the CFO's resignation, but she has raised concerns about the BeltLine project.
"We have to hold them all accountable," Payne said of the Atlanta City Council and the mayor's office.
Opponents of the borrowing do not want the city to divert tax revenue from the school system.
Georgia TADs require taxing entities, such as the city, county, and school board, to allocate increased property tax revenues created in the district based on new development that comes on line to back TAD debt. When the district is created, property values are frozen. The additional taxes that are paid on the incremental increases in value are used specifically for the tax allocation district, and in this case, they would be used to back the debt.
Although the BeltLine has been touted by the Franklin administration as a major economic tool, opponents say that the projects involved, especially those being partly funded with school funds, may not be the best use of taxpayer money. They argue that the developers of the projects should pick up the tab.
The BeltLine project would involve redeveloping property in a 22-mile loop around the downtown area of Atlanta and would include a new trolley-like transit system to connect several major employment centers and other points in the metropolitan area. It would also include parks, bike trails, and space for retail, residential, and light industrial business.
The problem is that the BeltLine may not relieve Atlanta's transportation problems, according to Payne.
Doug Selby, a bond counsel attorney with Hunton & Williams, said the BeltLine project is a way for Atlanta to continue to move forward in its expansion efforts. He noted that the sheer fact that the Beltline will provide transportation, housing and retail in this downtown area is positive, considering the economic downturn.
Proceeds of the $120 million sale are expected to pay to buy develop green space and public art, purchase transit right of way, construct affordable workforce housing, perform Brownfield remediation, and pay for other transportation and pedestrian-related projects, the city's ordinance said.
The city has been hindered in issuing bonds for this project by taxpayer lawsuits objecting to the use of school tax dollars to help fund the BeltLine project.
The issue of TADS using school taxes will go to voters this fall, under a new state law approved this year. Georgia voters will be able to decide if school tax dollars can be used to fund any TADs. The General Assembly will consider the election results when they take up the issue again in the 2009 session.