“The charter has not been breached. No illegal activity has taken place,” she said.
All council members say they are eager for the city and schools to reach a resolution. The existing agreement requires the city — in exchange for using a portion of school taxes to build its parks and trails — to make $162 million in a series of fixed payments back to APS. The payments were intended to be made using the taxes collected with the Beltline tax allocation district, or TAD.
The city has withheld the past two years of payments — saying the Beltline TAD can’t afford it — and was facing another $7.5 million payment on January 1.
If it hadn’t paid, it would have exceeded a $15 million debt threshold and been in default of the contract, a move that would have had financial ramifications for the Beltline’s ability to expand its network of parks, trails and transit.
Reed has previously said the city has four years to resolve such a default. But earlier this week, he told council members that making the $9.1 million payment was critical to avoiding it.
“All we’re trying to do is prevent the Atlanta Beltline from becoming insolvent,” Reed said on Monday. “Council has expressed its judgment that you all want this matter resolved. We were in an environment where we were trying to reach a resolution and it was during a holiday period. The city attorney said we were within our rights.”
Reed has argued that the city is doing the same thing it has done in the past, when he said it fronted the money to make its last Beltline payment — $1.95 million in late 2013 — and was reimbursed by the Beltline tax increment fund. He contends that the $9.1 million payment is similar, and added that the city will be repaid by the Beltline fund in 30 to 60 days.
The mayor’s office did not draft any formal paperwork or legislation, however, outlining the terms of that repayment.
Moore said the mayor is incorrect. She said the recent payment is different because it used general fund dollars, and not tax increment outlined and approved in the 2009 contract. What’s more, she presented evidence on Wednesday that the previous Beltline payment had been approved by Invest Atlanta and wired directly from the Beltline tax increment fund.
Reed’s staff maintained the administration was not in error.
So far, only Moore and Councilwoman Mary Norwood have openly criticized the mayor’s office over the issue. Council members Alex Wan and Yolanda Adrean have asked pointed questions about the transaction, but stopped short of declaring it a violation.
Councilman C.T. Martin, a Reed ally, called for some leniency as the mayor continues to negotiate what all describe as a high-stakes deal.
“I think the options are to spank his hand or let him continue to negotiate until it’s resolved,” he said.