(APN) ATLANTA — At the Wednesday, May 13, 2015 Board Meeting of the Atlanta Beltline, the Board passed the Fiscal Year 2016 budget for the Beltline that does not provide any payments towards the Beltline’s 13.5 million dollar debt to Atlanta Public Schools (APS). This debt reflects two missed payments in January 2014 and January 2015.
Based on the 2016 budget, the Beltline now plans to miss a third payment in January 2016, in the amount of 7.5 million dollars; and will owe a total of 21 million dollars at that time.
The Beltline had agreed to make a total of 162 million dollars in payments to APS, in return for making an initial investment to the Beltline by forgoing tax revenue, most recently in a 2009 amendment to their original agreement.
Former Atlanta City Council President Cathy Woolard, a 2017 candidate for Mayor of Atlanta and a Beltline Board Member, voted in favor of the budget, which puts parks, trails, and salaries, before schoolchildren.
Fulton County Commissioner Joan Garner (District 3), who, according to a source familiar with the matter, is considering running for Atlanta City Council District 2 in 2017, also supported the Beltline budget.
Also voting in favor were John Somerhalder, Elizabeth Chandler, Ernestine Garey, and Mike Donnelly.
Voting against the budget were Atlanta Councilman Andre Dickens (Post 3-at-large) and Atlanta Public Schools Board Member Cynthia Briscoe Brown (Post 8-at-large).
“At last year’s Board meeting, I was told that ongoing meetings would resolve this within a few months and we could amend the budget to include any agreed upon payment to Atlanta Public Schools,” Councilman Dickens said in a statement.
“The dispute is still unresolved and the current ABI budget proposal doesn’t seem to offer a resolution that would honor its financial obligation to Atlanta students and their parents,” Dickens said.
“My no vote against the ABI budget acknowledges my disappointment that there is still no funding set aside to address the organization’s financial commitment to APS. Unlike disputes involving property, this dispute involves resources for educational outcomes that affect two going on three cohorts of children in our city,” Dickens said.
Paul Morris, CEO of the Beltline, said at the meeting that the unresolved dispute with APS has harmed the Beltline’s ability to take out new loans.
The Beltline’s 2016 budget includes approximately 25.5 million dollars from the Beltline TAD, according to a copy of a budget Powerpoint presentation obtained by Atlanta Progressive News from Atlanta Beltline, Inc.
This includes two million dollars available at the end of June 2015; 300,000 dollars in excess tax increment from the Beltline TAD from 2015; approximately 1.5 million dollars from real estate transactions; and approximately 25.5 million dollars from Beltline TAD tax increment for 2016.
Of the 25.5 million dollars, approximately 7.5 million dollars is allocated for debt service on Beltline TAD bonds; 2.15 million dollars on a bank loan debt service; zero dollars for the APS PILOT payment; 600,000 dollars for APS legal fees; 1.35 million dollars for the Fulton County PILOT payment; approximately 500,000 dollars for “IA PCR”; 25,500 dollars for the EPA Revolving Loan Fund; and 222,000 in an interest payment on a consortium loan.
According to the budget, this leaves approximately 11.1 million dollars of TAD dollars for redevelopment for 2016, after subtracting [for reasons that are not immediately clear] two million dollars for cash on hand at the end of FY 2015.
In addition to this 11.1 million dollars in TAD money available for redevelopment, ABI receives revenue from numerous other sources, including the City of Atlanta, Atlanta Beltline Partnership, Georgia Department of Transportation, the Atlanta Development Authority (“Invest Atlanta”) from grants from other TADs, the U.S. Environmental Protection Agency, the National Endowment for the Arts, Ponce City Market, Enterprise Community Partners, and Strategic Land Acquisition Fund Partners.
APS boasts being the largest contributor to the Beltline TAD, more than the City and Fulton County combined; however, the City of Atlanta is the largest contributor to ABI’s total budget.
ABI will spend a staggering 5.348 million dollars in FY 2016 on salaries, and, according to its website, employs 35 people.
The Beltline argues that because of the economic recession beginning on or around 2007, therefore APS should renegotiate the terms of the agreement.
Ericka Davis, Communications Director for ABI, compared the situation to mortgage restructuring programs that the federal government offered during the recession, in an interview with APN.
Davis said that the estimated Beltline TAD tax increment revenue for the time period in question was three billion dollars, but that, due to the decrease in property values in the TAD, it is today valued only one billion dollars for the same period.
However, APS, the City, and the Beltline already renegotiated in 2009, pushing out the date of the first payment by two years. Thus, APS has already made substantive concessions in a post-recession amendment to the contract.
Also, as noted above, the Beltline has been making its annual PILOT payments to Fulton County; just not APS.
It is not immediately clear what rational basis the Beltline could have for making its required payments to Fulton County, but not APS, and thus for treating schoolchildren differently, were APS to bring an Equal Protection challenge.
(END/2015)
