BRADENTON, Fla. – This year could be a bellwether for economic improvement in Atlanta, following several years of budget pressure stemming from the downturn and declining property values.
Mayor Kasim Reed began the year by telling local organizations that he plans to propose that the city issue about $300 million of bonds for infrastructure needs to begin addressing a backlog that has grown to an estimated $922 million.
It is not clear yet if Reed will propose issuing general obligation bonds in the fiscal 2014 budget, though the city has used them in the past to pay for capital projects.
Atlanta last sold new GO bonds for public improvements in 2008, according to its 2012 audit.
“We’re going to have the largest capital investment above ground we’ve had in modern times,” Reed told the Atlanta Press Club Thursday, according to the Atlanta Business Chronicle.
Reed also was optimistic that a deal to build a $1 billion new National Football League stadium for the Atlanta Falcons would be reached.
Though a formal agreement is in the process of being negotiated in which the Falcons and the NFL would pay 70% of the cost, the remaining $300 million in bond financing secured by a hotel-motel tax is contingent on the state Legislature increasing the Georgia World Congress Center Authority’s bond capacity. GWCCA operates the Falcons’ current stadium.
“I think we’ll get a deal done on the stadium and that we’ll have a world-class stadium in the city of Atlanta,” Reed told the Press Club, according to the Atlanta Journal-Constitution. No one in Reed’s office responded to requests for more detail Friday.
Atlanta closed fiscal 2012 with $126.7 million in its general fund reserves, an increase of more than $119 million since January 2010 when Reed took office. Reed said his administration has concentrated on increasing reserves, which were just over $7 million when he became mayor. Reed has said that he intends to run for re-election.
“With our unrestricted reserves at 20% of our annual budget, the finance team is looking toward to tackling other critical needs of the city such as long-term investments in infrastructure,” chief financial officer Jim Beard said last week.
Moody’s Investors Service and Standard & Poor’s revised their outlooks on the city’s Aa2 and A GO ratings to stable from negative last week. The city had about $240 million of outstanding GO bonds at the end of fiscal 2012.
Both rating agencies said the stable outlook reflected the efforts of city officials to eliminate structural imbalance in the budget, pension reform, and increases in fund balance.
Raters also recognize Atlanta for its diverse local economy and as a major hub for its 13 Fortune 500 companies as well as banking, transportation, and trade. It is also the home of Hartsfield-Jackson Atlanta International Airport, the world’s busiest airport.
