After years of conflict, Mayor Kasim Reed and APS reach Beltline deal

The Atlanta school board unanimously approved a long-awaited deal with the city of Atlanta over funding the Beltline Friday, breaking the nearly three-year impasse that had hindered development of the popular trails and parks project.

The agreement goes to the city council Monday for final approval.

The joint announcement by the two sides Friday cleared the dispute that clouded the Beltline’s financial future, though it means APS will collect little more than half of what it was originally promised. With an agreement in place, the Beltline can more easily seek outside funding sources for future development of the trail and transit network.

“A healthy Beltline means a healthier APS,” Mayor Kasim Reed said Friday. “The children of the Atlanta public school system will prosper, Fulton County will prosper and the city of Atlanta will prosper.”

Resolving the issue signals “a renewed partnership” between the city and the school system, APS board chairman Courtney English said.

The agreement brings to an end years of conflict between Reed and school leaders that began in 2013, when the Beltline was unable to make required payments to APS in exchange for using school taxes to expand the urban trail.

Under the new agreement, the school district will get significantly less money than originally agreed to. Instead of payments totaling about $162 million through 2030, the new deal calls for Atlanta to pay $73.5 million through 2031, school officials said. Also, Atlanta would pay all past debts, about $14.8 million, APS officials say. But leaders say it gains more certainty that the school system will actually get paid.

Atlanta already made an initial $9.1 million payment toward its debt in December and is expected to pay another $5.8 million in February. The city would also make an additional $10 million payment next year, according to APS.

The deal brings stability to the Beltline, which has struggled to grow amid financial uncertainty. City leaders have argued throughout the conflict that a stronger Beltline — which they say has already spurred billions in private investment — will result in a higher property tax base to the benefit of all.

The new deal “will allow the Atlanta Beltline to recover from the worst recession in 80 years. And then, when the Beltline is strong and able again, it can make payments at a higher level,” Reed said.

APS will also receive the Bankhead Courts property, a vacant piece of land owned by the Atlanta Housing Authority, English said. The agreement calls for the school district to allow the city to refinance debt connected with another project — the Eastside Tax Allocation District — and for the school district to be paid $593,000 in money owed from that district.

Finally, APS will be paid directly, instead of through the city. The school district will automatically be second in line to get paid — right after bond holders, English said. And the agreement shortens the time limit before the school district can take legal action if the city doesn’t pay.

During negotiations last year, Reed and APS Superintendent Meria Carstarphen clashed over Reed’s refusal to release deeds to vacant APS properties that are held by the city. The agreement announced Friday does not address the deeds.

English said the new deal is more in line with Atlanta’s post-recession economy.

“I think we got a good deal for APS, one that allows us to help our kids right here, right now,” he said.

The Beltline dispute had led to disputes between Reed and APS officials, including former superintendent Erroll Davis, Carstarphen and English. City and APS attorneys also traded threats during the conflict, which also saw Reed and Council President Ceasar Mitchell at odds.

Reed, English and their respective attorneys have worked feverishly in recent months to reach a new accord and prevent the city from breaching the 2009 contract.

Reed’s administration came under fire by at least two Atlanta council members in the process.

Council members Felicia Moore and Mary Norwood cried foul over the nearly $9.1 million payment Reed’s administration made to APS in December. Last year, the council authorized $4 million for negotiations. Moore and Norwood believe Reed’s team circumvented city code by dipping into the general fund for the additional $5 million.

City Attorney Cathy Hampton, who represents both Reed’s administration and the city council, defended the payments as lawful under previous Beltline agreements. Moore, however, maintains that neither the city charter nor existing agreement allows the move.

Still, council members and school officials say they’re eager to put the Beltline saga in the rear view mirror.

The relationship between the Beltline, the city of Atlanta and APS is symbiotic, Mitchell said.

“It will allow us, if we actually move forward together in collaboration, to seize the future and seize the promise of what this city can be,” he said.

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