Brookhaven Parks Master Plan may take $67M bond, tax increase

If citizens want Brookhaven to quickly build the improvements in the Parks Master Plan, they may need to approve a $67 million parks bond and a 25-year property tax increase to pay off the debt.

The City Council originally approved a $28 million Parks Master Plan in 2016, but officials say now it will cost far more. In addition, a funding source for parks improvements was wiped out this year as a side effect of the deal for a new voter-approved DeKalb County special local option sales tax. The SPLOST was pitched as protecting homeowners with a property value freeze, but now those in Brookhaven could face a tax increase to make up for the park funding.

The city’s total tax rate could rise as high as 3.86 mills, from 2.74 mills today. That’s higher than the 3.35 mills cap set by the city charter, but officials say the cap is not violated because the law allows taxes related to bond debt to be levied separately. The debt-related millage would decrease over the years.

The parks bond idea was floated by the City Council and administrative staff at the council’s Feb. 3 retreat at the Hyatt Regency Atlanta Perimeter at Villa Christina. No decisions were made, but council members agreed to continue discussing the idea at future meetings. A vote could come as soon as the November ballot.

“Currently, there is no funding source to get the Parks Master Plans completed,” Assistant City Manager Steve Chapman said in an interview. “The only way to pay for all of this is to find an alternative funding source. If we pay as we go, there is a very low likelihood of the Parks Master Plan ever being completed.”

Maintaining and improving the city’s parks were major reasons Brookhaven broke off from DeKalb County to become its own city. “Parks” is one of the popular “three Ps” evoked in recent cityhood movements — parks, police and paving. Two years ago, the city finished a lengthy Parks Master Plan process conducted with public input.

The funding proposal involves a roughly $67 million general obligation bond to be paid off over 25 years and an increase in property taxes of about $6 a month per $100,000 taxable value for the same 25 years.

Rising construction costs, inflation and other factors over time will only add to the costs of fulfilling the city’s promise to improve its parks, officials say. A parks bond and property tax increase could mean all parks improvements and new amenities could be completed within three years, according to Chapman.

“These are sort of diverging concerns,” Chapman said. “Do [residents] want parks or do they want low taxes? By financing the parks, the people who are getting the benefit of the parks will be those paying for it.”

The $6 per month number translates to about $72 a year increase in property taxes for most Brookhaven homeowners, Chapman said. The tax rate would gradually decrease over the time of the bond, he added. It would start at 1.12 mills in 2020, then fall to 0.96 in 2021 and 0.91 in 2022, according to preliminary estimates.

Chapman explained to council members at the retreat that the recent approval of the DeKalb special local option sales tax (SPLOST) to raise the sales tax from 7 percent to 8 percent dedicates no money toward the city’s Parks Master Plan. The bulk of the city’s expected $47 million SPLOST funds over six years are dedicated for transportation improvements and road paving.

The SPLOST also eliminated HOST revenue that brought in $2.5 million each year to the city that could be used for the Parks Master Plan.

The HOST funds were generated from 1 percent of the 7 percent sales tax collected in DeKalb County and was divided among the county and its cities. Eighty percent was distributed to homeowners through property tax credits and 20 percent went to fund capital projects, such as parks projects. The SPLOST vote replaced HOST with the EHOST in which 100 percent of the revenue goes toward property tax relief.

Councilmember Bates Mattison voiced his frustration at the retreat with the SPLOST funding.

“Our citizens are getting penalized. Our only option is this additional tax. If we floated the debt earlier, it could have been paid for with SPLOST,” he said. “The only way we can pay is to raise taxes. And HOST could have done it.”

Councilmember Linley Jones said at the retreat she has heard from residents who are frustrated that SPLOST funds cannot be used for parks. In an interview, she said she personally supports the idea of residents having a chance to vote on a parks bond.

“This would simply be giving people the opportunity to decide if they want to quickly finish the eight parks master plans we have,” she said.

The proposed millage increase for the parks bond would not violate the city’s millage cap, and would be part of a separate debt millage, Chapman said. The city’s millage cap is 3.35 and the current millage rate is 2.74.

Chapman said state law requires voters to approve any debt, such as long-term general obligation bonds, involving property tax funds. If the voters approve a parks bond, then there is a separate debt millage that is restricted to paying off the debt, he said.

The city’s charter also states the millage cap does not apply to such debt, he said. “The separate millage will be paying the debt service payments based on the bond issuance, based on the projects outlined in the referendum,” Chapman said.

An update of the Parks Master Plan presented to the council at the retreat shows costs for Ashford Park, Blackburn Park, Briarwood Park, Fernwood Park, Georgian Hills Park, Lynwood Park, Murphey Candler Park and Murphey Candler Park II (an extension of the park) is about $60 million. That number is significantly higher than the $28 million Parks Master Plan approved by the City Council in 2016.

Chapman said the two estimates are not comparable. The original $28 million estimate from GreenbergFarrow, the city’s parks consultant, was “woefully lacking” because it did not include such necessary items stormwater infrastructure and sidewalks, partly due to lack of records from the DeKalb County management era, Chapman said. The new $67 million, an estimate also provided by GreenbergFarrow, is only for about 60 percent of the projects.

Brookhaven residents are currently helping pay for a $230 million DeKalb County bond approved in 2005 that is set to mature in 2020, Chapman said. That accounts for about $22 million a year from city property owners. The city can take that money residents are already paying and put it toward its own potential parks bond, Chapman said.

Chapman said city officials are already in talks with Parks and Recreation Coalition (PARC) Brookhaven members about the idea of a parks bond and ways to inform and educate residents.

PARC Brookhaven chair Sue Binkert said a PARC Brookhaven funding task force has met with city officials to discuss all aspects of park funding, not just a potential bond.

“We are in the very initial fact-finding and gathering information position to broadly go over all funding and how to have a really good park system,” she said.