Fresh Loaf

An Atlanta City Council member complained to me recently that the capitol city was taking a drubbing in the media over Mayor Franklin’s proposed tax increase, while other tax-hiking entities were getting off scot-free.

After a bit of research, I determined she’s right – depending on your definition of tax increase.

At the risk of boring the tax-savvy, I’ll explain that the amount you pay in property taxes is determined by two variables – your property assessment and the millage rate – and one constant, your total exemptions. If your assessment doesn’t change, but the millage rate is increased, you pay more. If the millage rate stays the same, but your assessment goes up, you also pay more – what is commonly called a “back-door” tax increase.

A few weeks ago, Fulton County, which oversees the assessment process, announced that property valuations had risen a whopping 19 percent, mostly due to higher assessments for commercial property. This means that Fulton, its 12 cities and two school systems, can all expect a tax-revenue windfall even without raising millage rates.

For Franklin, that’s not good enough. In order to erase a projected $40 million city budget shortfall, she initially proposed a tax hike of about 1.7 mills, then dropped that to .43 mills, based on the county’s assessment estimates. This would mean the owner of a $200,000 house would pay an extra $24.50 a year in property taxes, assuming a standard homestead exemption.

That’s fairly meager compared to the $2,400 total tax bill for the example we’re describing, but it still represents a tax hike. The Atlanta Board of Education, on the other hand, plans to keep its tax rate – at 22.65 mills, more than twice the city’s proposed rate of 9.35 mills – the same as last year.

But just by virtue of the higher assessments, the school board expects to collect an extra $88 million in property taxes next year, more than twice the $40 million the city wants to raise by increasing its tax rate.

In other words, the schools’ back-door increase would bring in far more additional tax revenue than the city’s proposed up-front tax hike. And the Council member was certainly right about there being no public outcry over the back-door increase. Should there be?

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Janice Davis, chief financial officer for the Franklin administration, handed in a letter of resignation this morning. But, allaying the worst fears of some Atlanta officials, she won’t be departing until after the contentious city budget is put to rest.

“The budget is about to undergo open-heart surgery and she’s the only one in the room with a medical degree,” says Councilman Howard Shook, who received Davis’ two-sentence resignation by e-mail a short while ago.

A few council members have grumbled that Davis should be fired for presiding over a budget process that produced a $60 million shortfall in the current-year budget and a projected $140 million shortfall in the upcoming 2009 budget. But Shook, who chairs the Council Finance Committee, and others have argued that doing away with Davis would leave the city without a finance chief when it needs one most.

Several council members have privately speculated that Davis would leave the city’s employ shortly after the adoption of next year’s budget – and it now appears that will be the case.

According to Davis’ brief letter, she will stay on the job until July 9, then leave to accept a position in Texas. A Franklin administration spokesperson had no comment.

As of now, the Council is preparing to hold a series of budget discussions to tweak a Franklin budget proposal in an attempt to erase a proposed tax increase. The Council is scheduled to approve the final budget at a special meeting June 27.

(Photo by Joeff Davis)

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CAMPAIGN RELIEF: Clinton is expected to concede the delegate race to Obama today. * She’s saying she’ll “do whatever it takes” to put a Democrat in the White House, which was taken by Obama supporters as a hint she’d accept a VP offer.

* UPDATE: Now the Clinton campaign denies AP reports that she will concede the nomination tonight. Sigh.

WATER RETENTION: U.S. Fish and Wildlife Service approves plan to keep more water in Lake Lanier and other Georgia reservoirs.

CHAMBLISS: “Amazed” by public support for the U.S. Homeland Security Department’s National Bio- and Agro-defense Facility in Athens.

KSU PROF: Gets $201,000 grant, seen as boon to smallish university’s research cred.

SMOLTZ: Comes off DL, blows save.

BORDER TOWNS: Would lose their edge, literally, if that Georgia/Tennessee border change ever happened.

A TAX TO GRIND: Mayor Franklin proposes 4.8 percent shortfall-alleviating property-tax increase, which is palatable to some City Council members compared with her original estimate of 20 percent or more, but still too much to others.

WHAT ALES US: Beer prices are rising as ingredients cost more and production is down. Apparently, beer may not be recession-proof.

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WE FIT: Atlanta’s the sixth-fittest city in the country, according to a report released Thursday.

TAXES TWO-STEP: City Council, worried about approving the mayor’s property-tax increase, may not adopt the budget by the June 30 deadline, a delay the mayor says could affect city services such as public safety and trash pickup.

TRIBAL STUDY: Researchers shoot aerial photos of an Amazonian tribe that hasn’t had contact with the outside world while the tribe aims arrows at their plane. Survival International says the group is one of about 100 uncontacted tribes worldwide.

INTERPOL: Posts red-flag alert online for Columbus, Ga., double murder suspect.

HUSBANDRY: Decatur woman is indicted for allegedly being married to six men simultaneously to help them become U.S. citizens.

BEAR KILLED: The menagerie that is I-75 — where a zebra and a pig were hit by cars in April — suffers another casualty, this time a bear that was hit and killed at I-75 and I-285 in Cobb.

GREASE DE RESISTANCE: Restaurants are beginning to lock up their grease barrels as gas-price-weary thieves have been stealing thousands of dollars worth.

FRAUGHT TRAINS: The nation’s rail network is creaking under the strain of added workload on aging infrastructure.

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CRITICS AT BAY: Florida Sen. Bill Nelson tours the Apalachicola Bay to survey the effects of retaining more water in Lake Lanier, and says he’ll push for a National Academy of Sciences study of how low flows affect the river ecosystem.

LIGHT AT THE END OF THE FUNNEL: 2008 could be a record year for U.S. tornadoes, and while meteorologists aren’t sure why this year has been so tornadically prolific — including the twister that caused $40 million in damage in north metro Atlanta last week — the good news is that tornado season usually starts sputtering out in June.

BORDERS SKIRMISH: City Council President Lisa Borders writes a letter to her councilmates asking them to be nicer to the mayor.

HAWKS GM SEARCH: As is becoming typical of front-office searches in Atlanta pro sports, Cleveland’s Chris Grant withdraws himself from consideration after being offered the general manager job.

UGA EXPANDING IN GWINNETT: With the Brain Train struggling to gain traction, UGA just starts filling the gaps between Athens and Atlanta with itself.

ALL’S WELL THAT ENDS WELL: Piedmont Park may soon install wells for water independence, pending a decision by the state Environmental Protection Division.

CAUGHT LEAD-HANDED: Two studies link children’s lead exposure 25 years ago and increased impulsive and criminal behavior in adulthood.

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FEE FOR ALL: Atlanta City Councilman Jim Maddox proposes taxing $1 for tickets to pro sporting events and major concerts in the city to help soften the looming $140 million budget shortfall.

14TH STREET BRIDGE: Dead to us.

GET OUT OF MY CAR: Between March 2007 and March 2008, American driving dropped at the steepest rate since record keeping began in 1942.

ABATED BREATH: Beginning next year, asthma sufferers will have to switch to the more expensive CFC-free inhalers for environmental reasons, good for ozone but a blow to Atlantans who already live in an asthma-unfriendly city.

YOU GOT CONSERVED: As utilities start raising rates to make up for reduced usage, the dark side of conservation is rearing its head across the Southeast.

ONE FLU OVER THE CUCKOO’S NEST: Study released Monday says strains of bird flu are getting closer to conditions that could lead to a human pandemic.

GETTING BROWSY: The “browser wars” of the mid-’90s are heating back up, as Mozilla readies Firefox 3.0 for release in June and Microsoft’s Internet Explorer 8 is due later this year.

FRIGHTENING IN A BOTTLE: Orlando man sells bottles that he claims have ghosts in them.

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TEACHING TO THE TESTAMENT: Bible-as-literature classes clear legal hurdles in Tennessee and Georgia.

FLOCK ENROLL: Atlanta is the No. 1 major metropolitan area in the nation for college enrollment growth over the last 17 years and No. 2 in number of degrees awarded.

OVERRIDE: City Council takes Mayor Franklin down a notch by overriding three of her recent vetoes.

TESLER TRIAL: Jury deadlocked.

LANIER: U.S. Army Corps of Engineers takes heavy fire for its water-releasin’ ways at the Lake Lanier Association’s annual meeting Monday; the association is so fed up it’s funding its own scientific study on how much water the downstream mussels need to live.

GRADY CURVE: Grady Health System is officially taken over by Grady Memorial Hospital Corp. today, and also receives the first $50 million installment of the $200 million the Robert M. Woodruff Foundation pledged.

FOOT (AND MOUTH) IN THE DOOR: The U.S. farm bill includes a provision allowing the incurable foot-and-mouth disease to be studied in a mainland U.S. facility, clearing the way for the National Bio- and Agro-defense Facility, for which Athens is one of six candidates.

COMING TO BLOWS: Sustained wind gusts of 20 to 30 mph expected today.

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Just minutes ago, the Atlanta City Council unanimously overrode Mayor Shirley Franklin’s veto, and in doing so, echoed their call for the city to conduct an audit of the Department of Watershed Management before the council votes on a 27.5 percent water and sewer rate increase.

UPDATE: Franklin, who’s currently in Las Vegas attending the International Council of Shopping Centers convention — Wayne Brady and Carson Kressley are also at the five-day event — issued this statement:

“As an advocate for the democratic process, I respect the Council’s right and responsibility to exercise the power of their vote, even when we may disagree. As elected officials our actions help determine the fate of this city and I would hope we would all do that based on research, data, best practices and what is in the best interest of the City, its’ residents and visitors.”

UPDATE: From Department of Watershed Management Spokesperson Janet Ward:

The Department of Watershed Management (DWM) continues to believe in open and transparent government. We are one of the most audited departments and utilities in the metropolitan area. An oversight task force from the Georgia Environmental Facilities Authority, with representatives of GEFA, the State Environmental Protection Division of the Department of Natural Resources and the City’s internal auditor and Department of Finance, performs an annual audit of our capital program. In addition, a private firm performs an annual external financial audit. Finally, the City’s internal auditor, who is currently undertaking an audit of the Department’s billing and revenue collection systems, performs regular audits of our operations.

The Department’s proposed budget includes funding for two full-time positions in the office of the City’s internal auditor that will be dedicated to auditing Watershed Management. In addition, as directed by a City Council resolution, DWM has been organizing a peer review group to analyze operations and financial management within the Department.

In short, DWM believes in audits. However, there appear to be some technical issues with the resolution passed by Council; because the resolution never went to committee, there was no opportunity to discuss the audit scope, procurement or funding. We look forward to meeting with the City’s internal auditor and with the Chief Procurement Officer as to how they intend to proceed with this effort. We are confident that, a well designed and professionally performed audit will confirm watershed management’s exceptional performance and stewardship.

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They say success has many fathers, while failure is an orphan. It may say something about Mayor Shirley Franklin’s proposed budget that it, too, is an orphan – at least where the City Council is concerned.

Let us explain: Typically, when the Mayor has legislation she wants to bring before the Council, she gets a willing Council member to carry it. But this budget includes hundreds of layoffs and a $40 million tax increase. So, for the first time in her tenure, Franklin couldn’t find any Council member willing to put his or her name on the legislation. Even Cleta Winslow, the Mayor’s most ardent loyalist, reputedly read Franklin’s staff the riot act last week. A panic ensued among the Mayor’s top brass over how to get the budget package formally introduced at today’s Council meeting, as required by law.

The compromise was a hastily called special meeting of the Council Finance Committee, which voted – under sometimes vocal protest – to pass the budget items on to the full Council in such a way that no individual member would be regarded as a sponsor. The final vote came moments before the Council meeting was called to order.

Now that the budget proposal has been introduced, you can expect to hear plenty of wailing and gnashing of teeth from the Council before it must approve a final version by June 30.

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Just came in via e-mail. City officials plan to lay off 125 workers in a first round of restructuring to chip away at the estimated $140 million deficit. Mayor Shirley Franklin has suggested several cuts and said that 788 positions — of which 441 are currently filled — will eventually be eliminated. Plans include raising taxes as well.

Click here to view Franklin’s letter to the city council that outlines her plan. Included in her proposal:

• Reduction of 135 personnel in support departments

• Reduce the number of operating municipal courts from nine to seven; consolidate the Office of the Solicitor with the Department of Law

• Eliminate 59 positions in Solid Waste Services and shift to bi-weekly collections of recyclables and yard trimmings

• Close 11 recreational centers for repairs and permanently close two recreational centers

• Eliminate city shuttle service

• Reduce the city’s contribution to health care plans from 77 percent to 70 percent

CL staff writer Scott Henry’s been at City Hall for most of yesterday and today and will provide more analysis.

In the meantime, I’m combing through the details to see if she uses any of the chatroom parlance with the council which she showed off when she made her most recent appearance here on Fresh Loaf.

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Current projected revenue shortfall in Atlanta: $65 million

Amount by which Atlanta exceeded its budget during fiscal year that ended June 2007: $90 million

Amount city overestimated its year-to-year budget surplus since 2003: $241 million

Estimated revenue shortfall city predicts it will face next year: $120 million

Amount of city’s budget shortfall when Mayor Franklin took office in 2002: $82 million

Percent property tax hike imposed in 2002 to cover city’s budget shortfall: 51

Percent by which the city has rolled back property taxes since then: 22

Percent by which all 15 city departments were recently asked to cut their budgets: 25

Sources: Atlanta Journal-Constitution, City of Atlanta Dept. of Finance

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On Wednesday the Atlanta City Council Finance Committee briefly discussed a proposal by Councilman Lamar Willis that … well, let’s just say it ain’t gonna make Shirley very happy.

Like most council members, Willis is fuming over the mayor’s recent announcement that the city is facing a $70 million budget shortfall because of unanticipated expenses and accounting mistakes. Therefore, Willis wants to rescind a number of pay-grade increases for city executives approved in November.

The increases boosted the salary ranges for top management positions, from chief of staff (max earnings rose from $208K to $237K) to chief financial officer (from $216K to $271K) to the budget chief (from $132K to $170K).

Councilman Howard Shook, who chairs Finance, says the increases were enacted last fall to make the city more competitive in attracting top-flight management talent. Besides, he says, since the pay-grade adjustments didn’t translate into immediate raises for the affected employees, the total cost of the measure has been estimated at about $10,000 so far.

“This is not how you overcome a $70 million deficit,” Shook says.

Perhaps, says Willis, but “it sends a message to the executives who possibly put us in this situation.”

The proposal has support from fellow council members Natalyn Archibong, C.T. Martin, Felicia Moore and Ivory Young. Still, Willis agreed to hold it until the next meeting to allow time to see what the actual cost of the pay-grade increases has been.

Who will figure up that figure? The city finance department, of course.

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