Michael Sullivan invokes what he calls the "but-for" test in weighing whether a special tax allocation district should be used to pay for a redevelopment project.

The Lawrenceville attorney says tax allocation districts (TADs) should be used to finance a project if —- and only if —- the project or development is too prohibitively expensive for the free market to get it off the ground.

"You use TAD funds where the project wouldn't happen without that element," Sullivan told me. "You don't use them to make the project much more profitable. You use them when a project or development wouldn't happen except for TAD funding."

Sullivan knows a thing or two about TADs. He's the attorney for the developers who have proposed the $2 billion redevelopment of the OFS Brightwave fiber optics plant at Jimmy Carter Boulevard and I-85. That project is now on holdas a result of the Georgia Supreme Court's unanimous ruling Feb. 11.

The high court said a projected $850 million in school taxes can't be used to build parks, transit and affordable housing on Atlanta's proposed Beltline.

The decision riled many a developer. It put in limbo projects that had planned to use TADs as a funding mechanism, including the OFS proposal.

The high court got it right. Constitutionally, school taxes shouldn't be used to pay for redevelopment projects.

J. Alvin Wilbanks, the superintendent of Gwinnett County Public Schools, said he thought the merit of TADs should be weighed on an individual basis.

"From the school system's perspective, development can increase the growth digest, which could have a positive impact on the community and its schools," he said in an e-mail.

Think whatever you'd like about the funding mechanism. The OFS site seems to be a prime candidate for it.

It's one of the first industrial sites in Gwinnett. Costly sewer and infrastructure upgrades pose conditions that would make an overhaul of the site expensive for any developer, and that's what TADs were initially created for: to help local governments upgrade blighted areas whose renewal carries sticker shock.

Some projects, though, make you wonder why a TAD is even necessary. Case in point: the Suwanee Gateway.

City leaders in the town want the area surrounding Exit 111 off 1-85 to be a showcase for residents and visitors. Before the high court ruling, they had plans to create a tax allocation district to help fund $35 million revitalization efforts in the area: think streetscapes, new offices and shops, according to the city Web site.

But would a TAD for this part of Suwanee pass attorney Sullivan's "but-for" test —- the one in which he questions whether a project could sustain itself without use of a TAD?

Opus South Corp. has already begun building a mixed-use village on a 148-acre site east of I-85. Terraces at Suwanee Gateway is to include a mix or retail shops, restaurants, office space, a hotel and residential units. It should jump-start other projects.

Seems to me that in Suwanee —- ranked by Money magazine as the 10th best small community to live in —- the free market is alive and kicking along this corridor.

No need for a TAD.

> Rick Badie's column appears on Sundays, Tuesdays and Thursdays. Contact him at 770-263-3875 or e-mail: rbadie@ajc.com.