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Should DeKalb Schools embrace economic development? Fate of GM project depends on answer.


Even presidential candidates have not brought as many people to meet with AJC editors and reporters as did a delegation today seeking to turn up the pressure on the DeKalb school board to support the redevelopment of the dormant GM site in Doraville.

I counted 10 people on hand to tell the AJC why the resistance of DeKalb Superintendent Steve Green and his Board of Education may crush the ambitious project to create a downtown Decatur vibe – even bigger and better – on the former car manufacturing site bounded by I-285 and Peachtree Industrial. (You can read the news story about the meeting here.)

The development company, Atlanta-based Integral Group, plans to call the work, play and live community Assembly. As someone who passes the bleak landscape en route to work, I would love to see a bustling Atlantic Station-type project rise from the ruins, as would the city of Doraville, which believes the development would reverse its fortunes.

The question is whether DeKalb Schools – which takes 56 cents of every tax dollar collected in the county – is willing to expand its mission from education to economic development and participate in a TAD, which stands for tax allocation district.

As the AJC explained in a recent story:

The Doraville tax allocation district would work this way: Schools and local governments would agree to collect only the property taxes the 165-acre site now produces for the next 25 years. For schools, that is about $1 million yearly. The developers would start building on the site --- a proposed mix of housing, offices, retail and businesses. The increase in property taxes as values increased would not go to schools, DeKalb County and Doraville, but to pay off up to $247 million in bonds that would be issued to pay for the infrastructure the developers want before starting.

The city of Doraville, which contains the site, has agreed to the TAD. DeKalb County commissioners have also agreed, with the caveat that they would participate if the school district agreed to join. If the project were to continue without school board backing, developers would be forced to downsize --- or abandon --- their plans.

TADs have been successful funding mechanisms for infrastructure at Atlantic Station and for the Beltline, though the latter has been at the center of a dispute over missed payments from the city of Atlanta to Atlanta Public Schools, which concerns Green.

So far, the answer from DeKalb Schools has been a firm "no."

In a statement on the blog a few weeks ago, Green said, "After listening with an open mind, I remain convinced that our core business should be teaching and learning and the direction of the financial resources to our students. DeKalb schools have never before participated in tax allocation districts. Schools are our business...For the Doraville TAD, the school tax digest would be fixed for 25 years with a best-case scenario of nine more years before DeKalb would recoup lost taxes. What advantage does a 25-year commitment to freezing the school tax digest give students and schools?"

More money ultimately and a better DeKalb County, says the mayor of Doraville.

"The effect this development will have on the entire region cannot be overstated," said Mayor Donna Pittman, while at the AJC today. "I respect the school board. I believe they inherited a mess and they are trying to fix it. This is their opportunity. We are willing to come to the table and talk to them. It is really disturbing to me the school board could possibly stop economic development in our city. They have more power than the council, the mayor and the citizens. We’ve had several meetings with Dr. Green, and I met with a couple of school board members. A few have not even responded. We would like to sit down with all of them."

Among the financial evidence presented by the development team from a study they commissioned by Bleakly Advisory Group:

  • The total tax digest of the DeKalb County School System lost $1.6  billion in value from 2010 to 2015—this is the main source of revenue to support the school system.
  • Now, the Doraville TAD has an assessed value of $40 million.
  • DeKalb County Schools gets $358,000 per year in property taxes from the property—they will continue to get these taxes every year under the TAD.
  • At build-out, the Assembly/Doraville redevelopment will represent an investment of $2 billion.
  • It will increase the tax value (assessed) of the site by $750 million at build-out—an 18 times increase in value.
  • DeKalb County Schools will get $135,000,0000 in additional tax revenues from the development while the TAD is in effect.
  • When completed, DeKalb County Schools will receive $17 million annually property taxes from the development — 47 times more than it receives currently from the site.
  • This one development, on less than 200 acres, will roughly cut in half the county-wide  decline in the DeKalb County School’s tax base over the past five years

The most interesting comments at the meeting today -- at least to me as an education writer -- related to the role of school boards today.

"I think it is important the school board and chair understand their role in economic development and in the development of our county and future of our county...This project is so important," said Katerina Taylor, president and CEO of the DeKalb Chamber.

I have interviewed more than 100 school board candidates over the years and never discussed targeted economic development with them. We talked about the role of schools in influencing real estate values and community cohesion and the urgent need to ready kids for jobs and colleges. But I can't recall candidates mentioning wielding the taxing power of the district to spur private development. Nor did any of them cite the role of a school board member as enticing such development.

So, this represents new territory, and I understand the hesitation of DeKalb board members to add economic development to their many challenges, including warding off state takeover, improving under performing schools and passing an ESPLOST.

But that is their role, contends Egbert L. J. Perry, the CEO of Integral, the development company seeking to transform the GM plant into a hip mini-city.

By default, Perry said the project now hinges on people who didn't run for the position of mayor, council member or economic development director. They ran for school board and they applied for superintendent, but yet they dictate the direction of economic development by their control over the majority of the tax dollars collected in the county, he said.

The DeKalb school board's lack of responsiveness will stifle the growth of Doraville and the county, said Perry. "They should never be crucified for the job they are doing; they are doing it well. They say they are not in the economic development business. They are right. You are not supposed to be. But you are. And deciding not to support the TAD, you are actually making an economic development decision."

School board member Stan Jester believes the board should consider the TAD, but says most board members follow the lead of the superintendent who remains leery. Jester suggested a belated outreach to the DeKalb Schools may be playing a role.

"I think a number of people may feel disenfranchised and feel they weren't included early enough, even though most of the money is coming from the school district. And they feel now it is being jammed down their throats," he said on the phone tonight.

Jester believes the TAD is a financial boon for schools, saying, "I haven’t seen any arguments against the TAD that have any validity." And he considers a TAD a far better alternative than a tax abatement project. "With a tax abatement, we see nothing for 15 years. And we get nothing like an Atlantic Station," he said.

So, does Jester believe his school board colleagues might relent and at least meet with the developers? One problem is that while most elected officials in the county and beyond support the TAD, the public does not, said Jester, noting that 99 percent of the emails have voiced opposition. Although that seems to be changing, he said.

 

 

 

 

 

 

 


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About the Author

Maureen Downey has written editorials and opinion pieces about local, state and federal education policy since the 1990s.