About $68 million collected in tax allocation districts is immediately available to fund redevelopment projects, but state law and bond covenants are making it difficult to actually put the money to use, according to a 128-page report presented to the board of Invest Atlanta, the city's development agency.
Tax allocation districts or TADs are one of Atlanta's main tools to encourage improvement of troubled areas. They are designed to set up a virtuous circle — a portion of property taxes is dedicated to new development, which leads to higher property values, and the increased property tax revenue is funneled back to the districts to pay for fire stations, bridges and other assets.
Consultant Lionel L. Lynch of HR&A Advisors urged Invest Atlanta to find ways to free the $68 million to help Atlanta compete with other cities for jobs and development. Some states allow TADs to fund citywide marketing, small business loans or business incubators; Georgia does not.
Brian McGowan, president of Invest Atlanta, called the unspent cash a "great opportunity." Many major U.S. cities don't have capital to concentrate on eliminating blight and spurring economic growth, he said.
"Having $68 million to deploy just as the private sector is beginning to invest again gives Atlanta a huge advantage over other cities," McGowan said. "However, we need to be strategic, thoughtful and deliberative."
Local governments have set up about 20 TADs to finance redevelopment across metro Atlanta, including in Woodstock, Marietta, Smyrna and DeKalb County. But many TADs have struggled to attract investors after the economic downturn or have scaled back plans.
Meanwhile, job-seekers in Atlanta encounter unemployment rates hovering around 11 percent.
The report on the unspent money comes as Invest Atlanta's board is grappling with ways to keep better tabs on the money accumulating in some of the city's largest TADs. In a 94-page audit, Atlanta auditor Leslie Ward said oversight of that money was not adequate.
In the city of Atlanta, the districts now cover about 20 percent of the land area and encompass about 15 percent of its assessed real estate value.
Much of the $68 million comes from the Westside TAD, which was conceived to remove blight around the Vine City and English Avenue communities.
Atlanta Mayor Kasim Reed also has his eye on the $68 million. He told The Atlanta Journal-Constitution this week that the money is one possible source of funding for transportation projects if a 1 percent sales tax is voted down in a regional referendum on July 31.
About the Author
