An Odd Perspective On SB 31

What does the Clarke County School District have in common with Georgia Power Company? They both want to fund huge construction projects by collecting the money required for them on the front end before said construction begins, that’s what.

Says an article by Shannon McCaffery in today’s Banner-Herald concerning SB 31:

Critics complain the bill allows the utility to charge consumers for interest and shareholder equity costs on two new nuclear reactors at least six years before they're completed. Backers say Georgia Power will ultimately save money by trimming some $300 million of the project's estimated $14 billion price tag.

Perhaps – I can see merit in the arguments on either side and I will reserve comment on that for the time being. But isn’t this precisely the stratagem employed by the CCSD when it issued that $50 million in bonds back in 2007?

The idea as presented at the time was specifically that of saving overall costs by borrowing the money up front, thereby incurring interest payments, but avoiding the anticipated construction costs increases that would occur over the period required for sales tax revenue to accumulate. In essence, isn't this the same argument put forth by Georgia Power Company. Should the practice be regarded as different when government does it?

For some background on the bonds, see here and here

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The Old Farmers' Market II

I heard back from one of the appraisers at the Tax Assessor’s office yesterday. He graciously tried to answer my arcane questions, but could not tell me how much of that Department of Agriculture property the Unified Government leases nor the value of the property and building that collectively make up the former Farmers’ Market. No surprise there, as little effort is made to accurately determine the value of properties that are exempt from property tax which, as I’ve already noted, is perfectly reasonable.

Even so, I was told that the property was zoned “commercial-general” (CG), which means that it is deemed appropriate for all manner of uses. Although there have been no recent sales of similar properties in the area, I was told that $250,000 to $300,000 per acre would be a reasonable expectation for the value of the land (with the caveat that such a range was merely a guesstimate). Assuming an average value of $275,000 per acre, that 1.336 acres that may constitute the property leased by the Unified Government (see previous post) comes out to $367,400.

Using the “Tax Estimator” function on the Tax Assessor’s web site, that would yield $4879.07 in property tax for this year if the property was not tax exempt. Note however, that this is for the land only and includes no improvements whatsoever. The corresponding figure for the entire 4.55 acre site would be $16,616.60. Again, this figure ignores any improvements.

Consider that"real estate broker" estimate of $20,000 from 2003 (the way I read the article is that it pertains only to the Farmers’ Market portion of the property as it mentions a “1-acre tract”). Assuming an improved value of $3 million, again from that 2003 estimate, the figure rises to $39,840.00

For what it is worth, I was also told that properties along the West Broad Street commercial corridor to the west of Alps Road/Hawthorne Avenue generally command higher prices that do those to the east, where the Farmers’ Market property is located.

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The Old Farmers' Market

Or, if one prefers, “A Case Study in Government Ineptitude.” I say that because the Unified Government of Athens-Clarke County has kept a valuable piece of property off of the tax roll for a decade for no good reason whatsoever.

This piece in the current issue of Flagpole concerning the former State Farmers’ Market property on West Broad Street immediately caught my eye (scroll down to the second item). That is because I’ve wondered about the status of this property for a long time as I drove past it – the disposition of which was an issue when I ran for the Commission back in 2002 – thinking that it should have been resolved years ago.

As is frequently the case with such matters, this one has a long history, so let’s start with a session in the way-back machine and trace its history for the last sixty plus years.

Back in 1948, the Georgia Department of Agriculture purchased the property for use as a State Farmers’ Market. I looked up what I think is the original deed on the Building, Land & Lease Inventory of Property’s web site (deed number RPR 000262). The property continued in that capacity for the next five decades. At some point during that period, however, the “rear” of the property, meaning that portion bordering Old Epps Bridge Road, became home to a Georgia Department of Corrections facility (a topic to which I will return below). Nonetheless, the Department of Agriculture retained title to the entire site.

By the 1990s, the continued viability of the State Farmers’ Market had become a somewhat dubious proposition. Thus, at the end of March, 1999, the Department of Agriculture suspended operation of the Farmers’ Market and indicated that it had no further use for the property.

Immediately thereafter, in April, 1999, the Unified Government of Athens-Clarke County initiated a decade-long lease of the property for the sum of $1 per year. At the time, the folks down at City Hall had visions of using the property as the site of a new Fire Station #4 (subsequently built just down from its former location on Oglethorpe Avenue) or as a proposed Police Department precinct station, or some other similar use. In any event, no such plans ever materialized. During the ten years since, the property occasionally has been used by the Unified Government for driver training and by nonprofit organizations for food distribution and such, but that is all.

In 2003, the Commission considered relinquishing its lease, but a group of local activists lobbied for the creation of an “International Community Center” at the site to serve as a farmers’ market and a “social services” node for Athens’ burgeoning Hispanic population (legal and otherwise). The Commission bandied the ICC proposal about, but eventually voted to retain the lease while awaiting further proposals from the group, which never came (see agenda item 5, pages 8-10 of the PDF and the news coverage.

Said a Banner-Herald editorial from the time about the Unified Government relinquishing its lease and getting the property back on the tax roll:

This land has been off the county's tax rolls for at least 55 years. If the county continues to lease the state-owned property, it will continue to be tax-free. However, if it is sold to a for-profit entity, the county automatically would collect almost $20,000 a year on the property in its current condition. If the land is developed, obviously it would generate even more in property taxes.

Even so, the Commission made no move to discontinue its lease.

Finally, in 2006, the Department of Agriculture formally declared the property to be surplus and transferred it to the Georgia State Properties Commission for final disposition, and by that I mean selling it via sealed bid auction to a private party, thereby restoring it to the property tax roll.

Which brings us to the present. As John Huie notes in the Flagpole article mentioned above:

The old open-air farmers’ market on West Broad Street (just east of Hawthorne Avenue) hasn’t been used for that purpose for years, and the state of Georgia wants to sell it. But a local growers’ co-op, Athens Locally Grown, does use it as a pickup point for produce customers, and thinks it could be more. “Imagine the Saturday market moving there,” suggested Locally Grown’s manager Eric Wagoner in a recent email to members, “and truck farmers setting up stalls throughout the week. With working facilities and a little sprucing up, it really could be something nice.”

. . . But Wagoner has persuaded the state, which has declared the market “surplus property” to be sold to the highest bidder, to temporarily renew the county’s lease. “I’m putting together a plan to ’rescue’ the building from the surplus properties division, and get it re-dedicated to use as a permanent farmers market,” he told Flagpole. “It will require an act of legislature, I’m pretty certain.”

There are two problems with this. The first is that Athens Locally Grown already meets on public property, namely Bishop Park, and that arrangement seems to be working just fine – I see no reason to keep a valuable piece of property off of the tax rolls to the benefit of a group that already utilizes existing tax-exempt property.

The second is that the Unified Government will retain use of the property only until such time as the public sale process is completed and the new owner takes possession of it, a process I am told that should take about six months after the lease expires; there has been no renewal of the Unified Government’s lease, temporary or otherwise (and yes, I called the GSPC to make sure).

Be that as it may, I have tried to discover the size and value of the property leased by the Unified Government so as to determine the amount of property tax revenue it should recoup when the property goes private again – and there my troubles began. Last week, I spoke to the GSPC, the Athens-Clarke County Board of Assessors’ office, the Athens-Clarke County Clerk of Commission’s office, and the Athens-Clarke County Central Services office, being referred from one to the other. That is not so say that the folks to which I spoke were not trying to be helpful, it is just that no one could answer my questions.

Also, I looked the property up on both the GPSC and Tax Assessor web sites; the former gives no indication as to its value – no surprise there – and the latter gives a value for the property that proved to be entirely meaningless. The entire parcel, a total of 4.55 acres that includes both the Farmers’ Market and the Department of Corrections facility, is owned by the Department of Agriculture. The property is not formally divided between the two uses insofar as acreage, building sizes, vales, etc. are concerned. Further, I was told that the total values assigned by the Tax Assessor to the land and improvements did not reflect actual market value, as the office did not put much effort into determining values for tax-exempt properties (which, of course, makes a fair amount of sense). Regardless, the land value assigned to the property works out to $250,000 per acre irrespective of the value of improvements. Those so inclined can look it up for themselves (parcel number 122C1 J016).

Additionally, no one to which I spoke could tell me for certain how much of the total property was leased by the Unified Government, though the Central Services Director made an educated guess of 1.336 acres based on something his office had from a separate matter pertaining to the Department of Corrections (some to whom I spoke were not even aware that the Unified Government was leasing the property). I am hoping that I hear back from the Tax Assessor’s office as to some sort of realistic estimate of the value of however much property is involved, not to mention that of the building sitting on it, but we shall see.

Insofar as “rescuing” the property for taxpayer-subsidized use by yet another narrow special interest group (as the Unified Government has done with former Fire Hall No. 2, the Taylor-Grady House, the Morton Theater, the Athens Community Theater, etc.), I certainly hope not. This property needs to be returned to the property tax digest as soon as possible – just as it should have been a decade ago. As I understand the process, an act of the General Assembly will be required to accomplish that goal, but that aspect is a routine procedural issue.

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CCSD Per Pupil Expenditures For FY 2008

The Georgia Department of Education’s per pupil expenditure figures for FY 2008 were posted early this afternoon – and the numbers for the Clarke County School District, both in absolute and percentile terms, continue to amaze (and no, that is not a compliment).

Regarding absolute expenditures, the figure for the CCSD came in at $11,180.05, up $433.11 from the $10,746.94 figure for FY 2007. This constituted a modest increase of 4.03%. Even so, it still placed the CCSD between the 94th and 95th percentiles of the school systems included in the calculations (169 out of 179; for whatever reason Liberty County was excluded).

Consider some specifics; the breakdown of the CCSD’s per pupil expenditures for the DOE's seven administrative categories was:

Instruction $7357.46 (20.81% above the state average of $6090.18)

Pupil Services $303.20 (5.23% above the state average of $288.13)

Staff Services $730.77 (57.68% above the state average of $463.44)

General Administration $461.09 (4.42% above the state average of $441.58)

School Administration $634.01 (13.97% above the state average of $556.29)

Transportation $714.04 (63.77% above the state average of $436.01)

Maintenance & Operations $979.49 (41.50% above the state average of $692.20)

Total $11,180.05 (24.67% above the state average of $8967.83)

Of the ten school systems that spent more per pupil than did the CCSD in FY 2008, nine had much smaller student populations. That means that they had to spread fixed capital and administrative cost over fewer students, thereby forcing their per pupil expenditures up. They were:

Quitman County $17,266.97 (239 pupils)

Talbot County $14,604.39 (648 pupils)

Clay County $14,177.16 (312 pupils)

Taliaferro County $13,799.99 (222 pupils)

Atlanta City $13,710.40 (49,036 pupils)

Decatur City $13,443.93 (2504 pupils)

Baker County $12,196.32 (442 pupils)

Warren County $11,529.75 (771 pupils)

Randolph County $11,450.92 (1299 pupils)

Montgomery County $11,278.48 (1103 pupils)

Compare the CCSD per pupil expenditure with those of out neighboring school systems:

Barrow County (12,194 pupils) $7968.16 (71.27% of CCSD)

Jackson County (6852 pupils $10,279.22 (91.94% of CCSD)

Madison County (4711 pupils) $8942.75 (79.99% of CCSD)

Oconee County (6471 pupils) $8542.34 (76.41% of CCSD)

Oglethorpe County (2438 pupils) $8756.68 (78.32% of CCSD)

Then compare the graduation rates, AYP measurements, and test scores of those systems with those of the CCSD. What you will find is that the CCSD spent considerably more money per pupil and got consistently lower achievement . . . again.

Also note that the FTE (full time equivalent) count given for the CCSD was 11,834 students, an increase of 419 over the 11,415 given for FY 2007, not the “around 14,000” that is frequently claimed by the CCSD.

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A Ruckus Worth Remembering

This article in last Sunday’s Banner-Herald commemorates the five-year anniversary of what I regard as the single biggest local government miscue in the history of the Unified Government of Athens-Clarke County, namely the rental registration fiasco. As I read Blake’s piece, two things immediately came to mind, both of which struck me as patently self-evident.

The first should be readily apparent to everyone. It is that those of us who opposed the original rental registration plan, not to mention its rental regulation successor, by arguing that the obvious solution to the supposed epidemic of ordinance violations was to increase enforcement of the ordinances in question rather than institute an invasive Big Brother regulatory scheme, have been proven entirely correct. Read the article for yourselves.

The second may require a bit more thought, especially for many of the folks here in Athens-Clarke County. In the online comments to my letters to the editor and blog postings, I have been castigated repeatedly about the supposed civil liberties violations committed by the Bush Administration (I am the only right-leaning blogger in town). Of course, no one has offered a verifiable example of how an American citizen’s rights have been violated. Instead, the supposed violations reside strictly in the realm of the hypothetical and the theoretical.

Be that as it may, consider this. It was not George W. Bush who tried to force local landlords to collect personal information on their tenants and make that information available to government. It was not Dick Cheney who refused to reappoint a sitting judge because she did not give the political class the conviction rate deemed appropriate. It was not Karl Rove who recorded the names and addresses of those who spoke against proposed government policy and threatened them with prosecution.

So, who committed all of these transgressions? Anyone even remotely connected with the evil, fascist, jackbooted GOP? Hardly. In each of the instances cited, all of which derived from the rental registration debacle, it was none other than the Unified Government of Athens-Clarke County, that bastion of hard left progressivism populated exclusively by Democrats. The problem is that many expressed feigned outrage over the presumed violations of civil rights by the national government while conspicuously ignoring actual violations much closer to home.

At this point I will take the opportunity to note that I am a strong advocate of civil liberties and, in fact, further note that such advocacy has been the source of many of my tirades against the Unified Government. Even so, I recognize that civil liberties are not absolute and should not extend to foreign combatants captured on foreign battlefields in a time of war to the same extent that thy do to American citizens – you know, that bit about the Constitution not being a suicide pact.

Oh, and just to throw another one out there unrelated to rental registration, don’t forget about the Police Department and District Attorney listening in on inmate’s constitutionally protected phone conversations with their attorneys.

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HA! The Consortium Declared Illegal

The Consortium for Adequate School Funding in Georgia, that group of school systems that used my tax money to sue the state, defended by my tax money, to get its hands on even more of my tax money, has been branded as illegal by the state’s Attorney General. I have been on the Consortium’s case for a long time (see my blog posts here, here, here, and here, and a letter to the editor here).

Says the Associated Press:

The Georgia attorney general has ruled that a group of 50 school districts violated state law by forming a nonprofit organization to sue the state for more funding.

The ruling issued late Monday by Attorney General Thurbert Baker says the school districts "do not have the authority to create and utilize nonprofit corporations" such as the Consortium for Adequate School Funding in Georgia. The group was formed 2001 and filed a lawsuit against the state in 2004, claiming the state has an unfair system of paying for education.

The group withdrew the lawsuit in September over concerns that a new judge assigned to the case would not give a fair hearing and had plans to refile it.

Consortium director Joe Martin did not immediately return a call for comment.

I'll bet. So this means that Clarke County taxpayers will get a refund of the membership dues paid to the Consortium by the Clarke County School District, right?

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Some Happy Endings For The Thin Blue Line

See “Injured in the Line of Duty,” the cover story of the current issue of Spinal Column, a magazine published quarterly by the Shepherd Center in Atlanta. The story (pages 4-9) includes the Athens-Clarke County Police Department’s own Sgt. Courtney Gale.

According to its web site, the Shepherd Center “specializes in the medical treatment, research and rehabilitation for people with spinal cord injuries, acquired brain injuries, multiple sclerosis, chronic pain and other neurological conditions.”

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UGA, MCG, & O'Mally's

This post is mostly for Winfield J. Abbe. Though I neither know him personally nor agree with all of his positions – though I frequently do – I consider Abbe to be a kindred spirit. He habitually asks impertinent, though legitimate, questions of local government (as do I) and frequently is unimpressed with what answers he may or may not receive (as am I).

Just to get readers up to speed, the US Navy Supply Corp School, located in Athens for decades, is relocating to Rhode Island in the not-so-distant future. The property it is vacating in the Normaltown (Prince Avenue) area will be transferred to the University of Georgia. As you may have read in the news, UGA and the Medical College of Georgia are teaming up to open a new medical school campus there (though the political infighting continues). As an interim step, the UGA Real Estate Foundation purchased the former O’Mally’s nightclub property as a temporary site for its medical school activities. The plan is for the UGA/MCG partnership to occupy the O’Mally’s property in June of this year, with classes to begin in the fall of 2010. In 2011 (or so) when the NSCS leaves, the UGA/MCG medical program will move to Normaltown (some elements may move sooner as space is freed up by the Navy). As the medical school relocates to Normaltown, other UGA offices will move into the O’Mally’s location.

Mr. Abbe has commented on the purchase of the O’Mally’s property by the Real Estate Foundation (to which I would link, but I cannot recall were I read Abbe’s comments at the moment; also, other businesses have occupied the site since the club closed its doors year ago, but the location is still universally know as “O’Mally’s”). He points out that the 2008 value of the property as determined by the Clarke County Tax Assessor’s office was $4,144,686, while the price paid for the property by the Real Estate Foundation last February was $7,278,600, which works out to some 75.6% more that the assessed value. I looked the property up on the Tax Assessor’s web site and verified Abbe’s information for myself. Readers can do so as well; the property’s parcel number is 171D2 G002.

I sit on the Development Authority of the Unified Government of Athens-Clarke County (see below), a body specifically created to act as a conduit for bonds issued by UGA’s Real Estate Foundation and Athletic Association (though it can and has done much more than that), The Authority met late last week to consider a supplemental bond resolution concerning the construction and renovation costs for the O’Mally’s project – for what it is worth, the Authority’s meetings are open to the public and are advertised beforehand in the Banner-Herald.

In direct response my first question, the representative from the Real Estate Foundation indicated that it would soon be applying for a property tax exemption. Of course, this is to be expected, though I took the opportunity to note that there is a tipping point regarding how much land government takes off of the property tax digest (for those who do not know, Clarke County is the smallest in the state by area - I read somewhere that it is the third smallest in the nation - and a huge portion of it is not even on the property tax rolls. In response to my other question, I was told that the large discrepancy between the property’s assessed value and the purchase price had to do with the Foundation’s research on the market values of recent land sales in the area, which it tracks closely. I have no reason to doubt the claim, though I similarly observed that tax officials in Clarke County were not noted for low-balling their assessments of property values.

Even so, I voted for the bonds because I think that, in the long run, this is the kind of development that the community desperately needs, having missed out on several such opportunities in the recent past, and that the positive economic impact will outweigh any lost property tax revenue. Those so inclined can click here to review the various local authorities, development and otherwise, and here to read up on the Athens-Clarke County Economic Development Foundation.

Finally, in the interest of full disclosure I must confess that in my former life as an undergrad, I spent my share of sunny afternoons on the O’Mally’s deck, gazing out over the North Oconee and indulging in various and sundry libations (anyone else out there remember when the Mad Hatter would host Camel Night?).

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