ATLANTA, GA, September 25, 2015 – Commentary by Tom Doolittle, Contributor – Redeveloping the 165-acre former General Motors property in Doraville has virtually become a civic cause for the whole Atlanta Region. Since the manufacturing plant closed operations in 2008, speculation began in the media, with county and state officials prepping to pump new jobs into that tiny city—as well as DeKalb.
Naturally, the story line from that point forward was focused on the possibilities for the property and who would develop it, but not the form that public subsidy would take. The media did later report on one decision related to public financing. The beleaguered DeKalb County Government rejected a surprise $33 million bond issue intended for purchasing and cleaning up the property. New Broad Street, a developer with considerable up front planning efforts gave up on the job subsequent to that decision.
The rest of the region considered the job DeKalb’s to work out. That effort was considered a “failure”. Unfortunately, the bonds would have only cost an average homeowner about $5 a year and we’d now be in our fifth year of development. Instead we now have what amounts to a mess authored by the City of Doraville that DeKalb has to unravel because it unwittingly is “owning” Doraville’s problems in several ways (see below). “Unravel” means writing a stringent Intergovernmental Agreement (IGA) while its own lawyer has made the effort confusing. The IGA is currently a “three-way” which has to assume a great many things will happen, like the school system participating.
The troubles with this approach have been caused by one fundamental lack of judgement. (1) DeKalb isn’t leading the funding effort—the tiny burg of Doraville is, yet the County has assumed the obligations involved with HOSTING the IGA, which (2) makes DeKalb predict and cover the infinite possibilities of ways it can be taken advantage of, rather than requiring Doraville to do that. DeKalb has once again failed to exercise its natural leverage with so-called “partners” as it did in the soccer facility deal.
Folks, the TAD is a 25-year program in which absolutely nothing about potential development incentives is locked down. Every dollar of a $293 million TAD can be spent whether necessary to incentivize the GM property project or not…and DeKalb is undertaking the process of identifying what it WON’T pay for. If this seems like a topsy-turvy way to do business, it is.
Unbelievably, Doraville and the GM site developer (The Integral Group) are now leading county commissioners around by the nose—and the GM site is barely half of the TAD. At the last meeting, Doraville, which is holding up finalizing a set of conditions that the county needs in place—had the temerity to push for “interim” or “conditional” approval of the unfinished IGA because, get this—the developer, Integral, said it needed a “signal” of good faith to get a big loan.** By approving the motion to do so, DeKalb actually pledges the majority of TAD funding (including the school system in the “three way”) to do one thing—keep a developer in business.
Note: both the GM (“Assembly”) AND the inventory of TAD projects are “unknowns”—there literally is no way to predict what will be needed because “Assembly” is entirely speculative. There are no end users identified and the marketing plan is entirely a function of reeling in other GOVERNMENT users—like MARTA and the DeKalb Housing Authority (HUD). My feeling is that DeKalb doesn’t understand that—or how delicate Integral’s funding capability is. So naturally, the IGA won’t contain any conditions associated with those.
Also in the mix is the other half of the TAD, which essentially will commit DeKalb (and the school system until it also is extricated by preemptory conditions)—commit DeKalb to providing the majority of funds to build a “Downtown” (Doraville City Center) for Doraville and start the process of gentrifying Buford Highway. I do believe the current preemptory conditions that require all of the imagination of county commissioners to devise—will delete that portion of the plan, but who knows if it wants to in the first place.
In my view the best thing about the 2010 plan was it only related to developing the GM site—not Doraville itself. It was also simple in that DeKalb would simply negotiate a small contribution from the tiny city (as it should be) and the school system wouldn’t have been involved. If additional funding was needed to make the plan more “walkable” or otherwise attractive to the private sector, that could have been established later and some other sound way to finance that infrastructure could have been added with a separate and distinct approval process and no “guess work” that typically ends up a slush fund for money to be moved around.
None of that can happen now, so Bandaids must be applied after the fact, with stringent audit terms to make sure Doraville and Integral don’t run away with the project. My advice, start with one condition that is very simple—refuse to fund the city’s plan to embellish itself and don’t let the GM site project “creep” without each penny being justified—with reports available to the public.
**The following link for the commission meeting at time stamp 3:40 has Integral representative Eric Pinckney explaining the urgency for Integral in getting its loan–even to the point of implying that DeKalb would appear “dysfunctional” if it didn’t do so. http://dekalbcountyga.granicus.com/MediaPlayer.php?view_id=2&clip_id=1193 Pinckney also said that the loan would be used to start “work” (commissioners didn’t inquire about the nature of the work) and subsequently would use TAD bond proceeds to repay the loan.