The role municipal and county development authorities play in handing out tax incentives to corporations and how they can work together is expected to be reviewed in the General Assembly in the upcoming session.
State Sen. Elena Parent (D-Atlanta), whose district includes Brookhaven, said she is considering proposing legislation to promote discussions on how the various development authorities communicate.
“We do have a problem with jurisdictions coming out ahead by raiding other [jurisdictions],” she said.
In June, the city of Brookhaven granted a $36 million tax abatement to the Atlanta Hawks for its state-of-the-art training center now under construction in Executive Park. The type of abatement from Brookhaven is a payment in lieu of taxes, known as a PILOT fee.
The Hawks are paying the city’s Development Authority $302,900 a year for 15 years in exchange for the abatement and the end result is the county and the DeKalb School District are out millions of dollars of property taxes during that time.
DeKalb Commissioner Jeff Rader in July sponsored a resolution passed by the Board of Commissioners “to oppose city development authority tax abatement transactions without all development authorities agreeing to be bound by a consolidated, consistent and equitable abatement policy.” The resolution specifically denounced the annual payments to the Brookhaven Development Authority.
In 2015, the Decide DeKalb Development Authority surprised Brookhaven officials by granting tax abatements to Source One Direct at 1500 Northeast Expressway and also an office tower going up at 4004 Perimeter Summit Parkway.
The city part of the tax breaks totals $537,000 and, while the developments in theory will boost city coffers more than that, the abatement calculation apparently did not factor in the cost of city services.
Mayor John Ernst said in July that disagreements with the county over the Brookhaven deal would likely have to be brought up by the state Legislature. And that is where Rader and the Board of Commissioners have taken their case.
Rader said he is working with Parent on possible legislation that would require city and county development authorities to talk to each other before abatements are approved. Parent said she is specifically concerned about the school system losing tax money in such deals.
“What we’re looking to do is put in place not a veto authority, but to open up conversations with the school system because their interests should be represented,” she said. “Right now, they have no say and the deals are taking away money from them.”
Brookhaven Councilmembers Joe Gebbia and Bates Mattison are also publicly voicing their concerns that the developers for the Brookhaven/Oglethorpe MARTA mixed-use development project are intending to seek tax incentives from the city’s development authority and say they want to bring the county and school district into the conversation. However, rezoning for the project has not yet been approved and no official request from MARTA has been made to the city.
Brookhaven City Manager Christian Sigman downplayed any conflicts between the Decide DeKalb Development Authority and the city. He said the city has a good working relationship with the county development authority and school district.
“We don’t want a sideshow of county versus city,” he said.
“I have talked with the schools and the county. Good governments do this to have good institutional relationships. That’s what people expect so governments can work.”