City Councilmember Amir Farokhi, who represents the area, told The Atlanta Journal-Constitution that forgoing tax revenue isn’t warranted for land in such high demand.
“While more housing is welcome, a tax break is not needed here,” he said. “This remains one of the highest-demanded areas in the city.”
Development authorities play significant roles in recruiting jobs and investment, and DAFC is among the more prolific providers of taxpayer-funded incentives. But the authority has received criticism for approving tax breaks for projects in fast-growing areas, including the Beltline or Midtown with few public benefits.
Critics contend the authority often grants incentives for projects that would have been built without tax breaks. The authority, as part of the “bond-for-title” transaction, would earn a fee in exchange for enacting the tax break.
DAFC Executive Director Sarah-Elizabeth Langford said her office is in discussions with the developer to increase the number of affordable units by 25% — about six additional units, but that request is not reflected in the authority’s agenda describing the deal. Affordable housing and historical preservation represent additional cost burdens for Trammell Crow, she said.
“Based on discussions with developer, there are costs associated with this project that would not allow it to move forward in its current format, including the cost of affordability for perpetuity, without the tax incentive,” Langford said.
Trammell Crow did not respond to a request for comment.
Currently home to the Ammazza Edgewood pizzeria, the project site is within a quarter-mile of a heavily trafficked area of the Beltline that’s exploded with development. Centered around Krog Street Market and the graffiti-splattered tunnel of the same name, the corridor is home to multiple apartment, office, retail and restaurant developments under construction.
Maple Multifamily Land SE estimated its development would represent a $228 million investment and would spur 30 new permanent jobs.
A 2021 AJC investigation found DAFC provided preliminary or final approval for more than $328 million in tax breaks in a three-year period, largely in fast-growing areas like the Beltline or Midtown with few public benefits.
In the years that followed, DAFC members appeared to tightened the spigot on tax abatements. Two projects near the Beltline — the second phase of Ponce City Market and one by Fairfield Residential along Piedmont Circle — both failed to win approval of the DAFC board, but developers forged ahead with the projects without the tax breaks.
But in recent months, DAFC approved a $5.7-million tax break for new apartments along the Beltline and considering tax savings for a data center expansion that was already underway before it was shelved. DAFC also granted initial approval to an $11 million property tax break for an expansion of the luxury community Serenbe, including a pair of hotels and a “wellness” resort.
The DAFC and Invest Atlanta, the city’s economic development agency, are capable of offering tax abatements to developers. Fred Smith Jr., a former Invest Atlanta board member and a law professor at Emory University, said DAFC is perceived as an agency that greenlights tax abatements that Invest Atlanta would have denied.
He said tax incentives are often required for developments that include affordable housing. However, he said development authorities should seek more than minimums required by law.
“The sorts of deals that (DAFC) is approving, they’re the type of deals that Invest Atlanta would have approved easily 10 years ago,” he said. “But we know better now.”
Development Authority of Fulton County meeting
The board’s meeting is at 2 p.m. Tuesday at the DAFC’s conference room at 141 Pryor Street SW, suite 2052. It will be available to stream on Zoom at https://us02web.zoom.us/s/86783512933?pwd=anFnb1ZWSVllWDUxQS9wQVQ3eWFjQT09.