A conundrum plaguing the public sector — and specifically governments — is how to do more with less. Dwindling budgets make it difficult to meet even a community’s basic needs.
The path of least resistance, particularly on the government side, has been to increase revenue by raising taxes. There is, however, another approach.
Progressive governments have opted to establish economic development entities, like Invest Atlanta, that work with public-private partnerships to spur growth that can ultimately lead to a larger tax base.
President Barack Obama’s recent launch of the Build America initiative represents this approach of using tax dollars as a catalyst for economic development. This program, specifically geared to infrastructure needs, will address funding shortfalls surrounding deteriorating roads, bridges, railways and power and sewer systems across the country.
The valuable public-private partnerships that result will certainly be beneficial for communities. We know this because we have done it. And it works. An example is Invest Atlanta’s use of the U.S. Department of the Treasury’s New Market Tax Credits program. Since 2007, Atlanta has been awarded $148 million through this program. Of that amount, $38 million supports projects that create jobs or provide services to low-income communities.
We have seen projects like the Center for Civil and Human Rights open its doors as a result of $13 million in gap financing from Invest Atlanta. Other key projects include the Georgia Aquarium’s latest expansion with a $25 million tax credit, acquisition of land for the Aerotropolis development with a $30 million tax credit, and renovation of the former downtown Macy’s building into an events center and business incubator with a $12 million tax credit.
These projects amount to $80 million in tax credits that we expect to support development and job creation. To date, the New Market Tax Credits program has created nearly 600 jobs and retained more than 400 full-time-equivalent positions.
In addition to these more traditional public-private partnerships, Invest Atlanta has established two new programs for small businesses.
The Atlanta Catalyst Fund is a revolving loan program for new or existing businesses that offers up to $100,000 for the purchase of equipment or machinery, working capital support, training, property acquisition or leasehold improvements. A complementary program, the Atlanta Seed Equity Initiative, provides local entrepreneurs with equity investments to help new businesses mature.
Public-private partnerships positively impact residents of this great city. With our recent New Market Tax Credits award, we plan to spend $68 million over the next two years. Some of the funds are committed, but applications are still being accepted for new projects and businesses.
These funds will allow us to maximize returns to the Atlanta economy and continue the momentum around the unprecedented development that is happening here. Dream with us. Bring your hopes, your ideas and your vision.
Dale Royal is senior project manager/redevelopment for Invest Atlanta.
