ADA: All future TADs in Georgia impacted by court ruling
February 12, 2008 at 12:41 pm by Thomas Wheatley in NewsThe Atlanta Development Authority — the city’s economic development engine — responded yesterday to the Georgia Supreme Court’s ruling that the Beltline could not utilize nearly $860 million generated by the tax allocation district, or TAD. In so many words: The ADA’s disappointed and says yesterday’s ruling will have a big impact on what’s become the financing mechanism du jour in Georgia. Here’s the ADA’s response and updates on where existing TADs stand, as well as some background on TIFs, which are basically TADs by another name. Emphasis has been added to highlight key points.
This decision will reduce the economic impact of all TADs statewide. TADs are a national best practice (known as TIFs, or tax increment financings, in other states) and the City’s most effective incentive in helping to revitalize underdeveloped areas of the City. This ruling in essence cuts in half the incentive benefit and may slow redevelopment in the City’s targeted areas.
The City of Atlanta currently has ten TADs: Westside Downtown, Atlantic Station, Princeton Lakes, Perry-Bolton, Eastside Downtown, BeltLine, Campbellton Road, DL Hollowell Parkway/MLK, Metropolitan Parkway and Stadium Area.
This ruling will not impact projects funded by TADs where validated bonds are outstanding. Since 1997, bonds have been issued in the Atlantic Station, Princeton Lakes, Eastside and Westside TADs, totaling $410 million.
This ruling will affect future bond offerings in all of the City’s TADs. For example, bond offerings planned for 2008 are the BeltLine, the Perry-Bolton TAD and the third bond offering for the Westside TAD. We will revise the feasibility numbers for the Perry-Bolton and Westside projects to assess the funding implications for each of the proposed projects. ADA will communicate its findings to each development team later this week.
We are committed to moving forward with redevelopment projects in all of the City’s TADs. For more information, please see the following web sites:
TIFs as a national best practice
TADs in Georgia
2007 year-end report on the City’s Tax Allocation Districts
February 12th, 2008 at 1:40 pm
What a heartbreaking step backwards. Regardless of how you feel about the Beltline, it is pretty hard to deny the positive impact of TAD funded projects on the revitalization of the city as a whole.
February 12th, 2008 at 3:48 pm
This is a political CYA press release from the city for trying a financial move that was improper. This press release indicates to me that the City may have planned on future TAD’s including improper sources of funds, such as shool bonds, and this ruling has caused problems for those, as well..
TAD’s are fine and perfectly legal. The problem with the Beltline funding was an improper use of funds, not the fact that a TAD existed.
February 12th, 2008 at 4:41 pm
It saddens me to report that Arkansas figured this out nearly a year before we did. Georgia no good.
http://www.nwaonline.net/articles/2007/04/26/news/042707fztif.txt