CEO: DeKalb finances at "last resort"

Crime will go up and libraries will close if DeKalb County doesn’t raise taxes, CEO Burrell Ellis said Thursday.

Ellis told several hundred business leaders at his annual state of the county address that DeKalb – like the rest of the nation – has no money. The only answer is a millage rate increase.

Ellis said he recognizes that residents are struggling and a tax hike should be a “last resort,” but the county has reached its boiling point.

“In this year’s budget, we have cut $52 million from [the current budget] and are proposing a downsized workforce,” he told the group. “To cut more would cause a serious decline in essential services – police, fire, sanitation, libraries, parks and infrastructure -- essential services that sustain the qualify of life we have come to know here in DeKalb County.”

With 730,000 residents, DeKalb is Georgia's third largest county. Communities across metro Atlanta are considering tax hikes and slashing services to make up for a decrease in property tax and other revenue.

The DeKalb CEO’s endorsement of a tax hike comes two days after county commissioners said they would rather slash jobs and other expenses before raising property taxes.

“The commissioners agree that we want to eliminate the tax increase at this point, even if we have to make cuts and adjustments through the whole year,” Commissioner Connie Stokes said Tuesday.

Last month, Ellis proposed a $583 million budget for fiscal year 2010 that included a 1.86 mill increase, the equivalent of an 11-percent jump. The owner of a home valued at $200,000 would pay about $145 more.

But with 10 percent of DeKalb’s workforce unemployed, the CEO is going to have a hard time convincing some residents to pay more in taxes.

“A large number of homeowners can’t afford their utilities or put food on the table,” said Viola Davis, founder of the Unhappy Taxpayers and Voters group. “Our local government from the county to the school board has been irresponsible with the money we give them, yet they continue to demand more money.”

Davis said she is still waiting for the forensic audit Ellis promised in his 2008 campaign, before agreeing to pay any more taxes.

After hearing the hardship of the county’s budget, 20-year resident John J. Funny said he is willing to pay more for services, particularly police.

“If we want good service, we need to be wiling to pay for good services,” said Funny, who owns Grice & Associates transportation consultants in DeKalb.

But more tax revenue alone won’t keep the county afloat. Ellis is also calling for 760 jobs to be cut to offset an estimated $50 million drop in revenue.

Last month, the AJC reported that DeKalb lost $1.8 billion in appraised residential value, more than any other county in the metro area. DeKalb, Fulton, Clayton, Cobb and Gwinnett counties lost a combined $4.2 billion in devaluation.

In DeKalb, more than 5,700 foreclosures – most in the south end of the county – caused a large percentage of that drop.

In addition to declining revenue from real estate, Ellis pointed to a drop in funds since the General Motors plant in Doraville closed. The closure not only took tax dollars, but 4,000 jobs from the county.

The county also lost Perimeter Center when Dunwoody incorporated. Dunwoody took only six percent of DeKalb’s population, but 13 percent of the tax digest, said Mike Bell, the county’s financial director.

Ellis said he is also worried that the county’s bond rating – which Moody’s downgraded last month from Aaa to Aa1 – could drop further if revenue continues to dissipate.

More cops mean less crime

Despite the financial woes, Ellis touted a decreasing crime rate, but said that was only possible because of more officers on the streets. Last year, county officials reorganized what Ellis called a “top heavy” force and put some of the upper management back on patrol.

Any cuts to the police department would drastically hurt those efforts, Ellis said.

“Public safety is our number one priority,” he said. “All of the other positive goals we have for DeKalb are not attainable and not sustainable if we are not a safe county.”

Ann Brown, president of the Belvedere Civic Club in south DeKalb, said the only way she will pay more in taxes is if it goes directly to hire more police.

“Public safety was supposed to be one his first priority. I haven’t seen that,” said Brown, a DeKalb resident for 28 years. “The only thing that’s changed is he fired the police chief and hired a public safety director. We don’t need another director; we need officers on the street.”

Even with the tax increase, Ellis’ budget proposal calls for a 4.3 percent cut to the police department’s budget.

Hoping for federal aid

While Ellis is proposing cutting jobs, he calls for the creation of a new department with four new positions. Ellis said he plans to hire an inspector general to investigate allegations of fraud, waste and abuse in the county.

Ellis said the inspector general will not drain the budget because he plans to shift several positions from finance to create the new department.

J. Mac Willett, owner of Willett Engineering Company in Tucker, said he appreciates Ellis’ efforts to be transparent and supports a tax increase.

“I really think he has what’s best for the citizens at heart,” Willett said. “I got to raise my fees. Everyone is seeing an increase.”

In addition to tax dollars, Ellis is putting his hand out for more federal stimulus money.

The county has already landed a total of $175 million in federal stimulus money – something newly elected Atlanta Mayor Kasim Reed took notice of at Thursday’s address.

“I think he’s done an exemplary job in getting federal stimulus money. I think that’s something I can learn from,” Reed said.

Commissioners said they always looking for more federal dollars, but the budget can’t be based on hopes.

"I want to make sure we have a plan in place,” Commissioner Sharon Barnes Sutton said Thursday. "If I have to make a choice between employment and a slight millage rate increase, I believe I would be in favor of [the tax increase]. But I want to look at cutting expenses first."

Ellis acknowledged the commissioners' concerns but wants to hear from residents before making any major changes to the budget. Twelve town hall meetings focusing on the budget are scheduled through February.

“I don’t know how much further we can go,” Ellis said.

Learn more about metro Atlanta property tax valuations in the AJC's investigative series at: ajc.com/news

DeKalb budget meetings:

Jan. 12, 7 p.m.

McNair Academy, 2162 Second Ave., Decatur

Jan. 14, 7 p.m.

Druid Hills High School, 1798 Haygood Dr., Atlanta

Jan. 19, 7 p.m.

Chapel Hill Middle School, 3535 Dogwood Farm Rd., Decatur

Jan. 21, 7 p.m.