Monday, November 28, 2011

"9-9-9 - The Movie"

Herman Cain's "9-9-9" tax plan:

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Taxonomics - Episode 1

From our friends at the National Taxpayers Union, see Taxonomics, Episode 1, A Discriminatory Tax Targets Small Businesses & Jobs.

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Review of Selig Tract Raises Questions

Read the column here (27 November 2011).

I always ask my wife to proofread my columns (so if an error slips through, I can blame her, right?). Upon reading this one, she said that I sounded angry.

And you know what, she is correct; quite apart from the self-righteous sanctimony of asking Selig to "negotiate," when its proposal is exactly the kind of mixed use development we say we want and the company is asking for no incentives whatsoever in connection with the project, this "hold" – kind of like moratorium lite – and "negotiation" strategy is a terrible one to pursue if we are serious about economic development. The community of folks who are involved in economic development around the state is a pretty small one and they all know what the others are doing, so don't think for a minute that they all do not know how things play out in Clarke County – i.e. a developer adhering to existing ordinances and design guidelines is not enough - as do the companies they are trying to recruit.

When we demand that the Commission adopt more stringent environmental regulations than what the state EPD and the federal EPA requires (not that the locals have the authority to do so, but that is another matter), like we did when Certainteed investigated asking for industrial development bond funding to expand its Athens location a few years back, every business or industry thinking about expanding in or relocating to Athens hears about it.

When we toy with the idea of making economic development bond issues a political football by having the full Commission vote on them, rather than simply having the mayor sign off on them as traditionally been the case (as was also mentioned in connection with the proposed Certainteed expansion), every business or industry thinking about expanding in or relocating to Athens hears about it.

When we demand that a developer (in this case Selig Enterprises) that is acting in full accord with our existing zoning ordinances and downtown design guidelines, “negotiate” to make its project smaller just to pacify local elected officials, every business or industry thinking about expanding in or relocating to Athens hears about it.

When we simply suspend entire sections of our existing zoning ordinances (we are up to how many development moratoria now?), typically with little to no public notice whatsoever, so as to prevent developers from doing precisely what those zoning ordinances say they should do, every business or industry thinking about expanding in or relocating to Athens hears about it.

When we mount a fullscale wand well-funded PR campaign (complete with billboards and a web site) to convince a high-end biotechnology facility (NBAF), precisely the kind of industry that we say that we want, not to come here, every business or industry thinking about expanding inn or relocating to Athens hears about it (of course, I think that there was qute a bit of Bush Derangement Syndrome evident in this episode, but the principle still applies).

I keep making the argument that what we do locally has repercussions beyond whatever issue with which we may be dealing at the moment, and those repercussions are stifling our meager attempts at meaningful economic development.

Okay, now that I’ve got that out of my system, here is some source material.

Unified Government Code of Ordinances. See Section 9-4-15(c)(4):

Commission Minutes (March 2010). See pages 11-12:,%202010%20minute...

Commission Minutes (September 2011). See pages 2-3:,%202011.min...

Finally, even on the company’s own web site both “Walmart” and Wal-Mart” are used, so take your pick.

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Friday, November 25, 2011

SCHS Pigskin Recap

The season for my alma mater Indians (the second seed out of Region 8AAA) drew to a close last Friday night, as SCHS lost a 40-14 road decision to Cairo (the first seed out of Region 1AAA).  The trip down to Grady County was some 300+ miles - one way!

It was a disappointing end to a pretty good 9-3 season: all three teams to which the Indians lost are still alive in the state playoffs, Elbert County in Class AA and Gainesville and Cairo in Class AAA.

Wait till next year.

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'Sausage' Is Part Of Recipe For Tax Reform Bill

Read the column here (03 April 2011).
Everyone and his brother has been/will be commenting on the specific policy proposals put forth by the Special Council and passed by the Special Joint Committee; I though it a good idea to get people up to speed on the mechanics of how we got to where we are with regard to that proposal - because most people have not a clue about it. Apparently, not everyone agrees.

The short answer is yes. TSPLOST will be an additional 1% sales tax, on top of the 4% that goes to the State of Georgia, Clarke County's 1% LOST, the Unified Government's 1% SPLOST, and the Clarke County School District's 1% SPLOST.

For anyone interested, the Special Council's web site has scads of information: (

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Clarke School Budget Lacking Details

Read the column here (17 April 2011).

For those who may want to view source material for themselves, here are the links. Also, the percentage calculations noted are my own; if you want to double check them (which means that you are really, really hard up for something to do), by all means have at it.
FY 2010 per pupil expenditures for the 181 local school systems reporting and the State of Georgia average:
That $11,900 current per pupil expenditure claimed by the CCSD:
CCSD FY 2012 Budget Overview:
CCSD Proposed FY 2012 Tentative Budget:
CCSD Budget Hearing Notes for FY 2012 Presentations:
posted @

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Local Programs Give Practical Emergency Preparedness

Read the column here (01 May 2011).

Here are some links that readers may find useful. Note that the contact information given in the column is current, but that given on some web pages that are floating around out there may not be.

Athens-Clarke County Citizen Police Academy (not much of a site, but it does have the full curriculum):

Athens-Clarke County CERT:

The Unified Government’s CERT program has not offered classes for a while, as it has proven problematic getting the requisite number of folks together at the same time to make conducting one worthwhile. Even so, Mr. Gulley informs me that a retooling of the program is underway and he hopes to offer classes again in the not too distant future. The East Georgia chapter of the American Red Cross may (or may not) be involved going forward depending on circumstances.

University of Georgia CERT:

I would like to thank Lt. Soriano, Mr. Gulley, and Mr. Golden for their kind assistance in the preparation of this column.

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Monday, November 21, 2011

Here's Primer For 'Beloved' Rite Of Spring

Read the column here (15 May 2011).

A chart detailing the various millage rates charged in each of Athens-Clarke County’s five tax districts used to be posted on the Tax Commissioner’s web site; I could not find the chart on City Hall’s new and improved (and expensive) web site. Upon speaking with the staff at the Tax Commissioner’s office so as to verify my information, I was told that they will try to get that chart reposted. In the interim, see page 7 of this from the Georgia Department of Revenue for the current breakdown of millage rates here in Athens-Clarke County (does not have the rates for Bogart and Winterville):

For a listing of exemptions, see these from the State of Georgia:
and these from Athens-Clarke County:

For a discussion of assessments, see these from the State of Georgia:

and these from Athens-Clarke County:

While they do not apply to most cases, there are a couple of “preferential” assessment categories (rehabilitated historic property or landmark historic property) and several “special” assessment categories (preferential agricultural property, conservation use property, environmentally sensitive property, farm land property, brownfield property, residential transitional property), a category for timberland (standing), and one for equipment, machinery, and fixtures.

For the provisions of SB 346 that mandate annual assessment and estimated tax notices, see O.C.G.A. §48-5-306:

Then there is this from a blog posting over at TOA from June 2008 ( Back in 2007, the Clarke County School District’s SPLOST 3 bond resolution included a provision that, should the limited duration sales tax be insufficient to repay said bonds, any shortfall would be added to the CCSD’s portion of the local property tax millage rate. Longtime readers may remember that I had two specific concerns with regard to any such transfer of bonded indebtedness to property taxes.
My first concern dealt with the 20 mills limit imposed by the state Constitution. The CCSD’s portion of the local property tax millage rate has been at the 20 mills limit for years; to exceed that limit would normally require the voters’ approval to do so via a referendum. So how could that line be administratively traversed so as to make up a SPLOST revenue shortfall without a referendum?
After a (very) long and circuitous journey through a variety of local and state government bureaucracies, the Attorney General’s office provided me with the relevant Georgia Supreme Court case law, Seaboard Air-Line Railway Company v. Wright, comptroller-general, et al., from way back in 1927, that exempted bond debt service from any constitutional limit. I do not agree with the reasoning embodied in that decision, as it would seem to render the rationale for the 20 mills limit moot, but the case law is what it is.

Satisfying my second concern has proven somewhat more vexing. The CCSD’s bond resolution cited a provision contained in the Constitution as expressly permitting the transfer of bonded indebtedness from SPLOST sales taxes to property taxes. That resolution read in part (see the second paragraph on page 5 of the PDF):

"WHEREAS, Article IX, Section V, Paragraph VI of the Constitution of the State of Georgia requires that prior to the issuance of general obligation bonds, a tax must be levied in amounts sufficient to pay the principal of and the interest on the Bonds as the same become due and payable, to the extent that the revenues from the Sales Tax are not sufficient thereof;"

The resolution was littered throughout with similar language. Being a nerdy type reasonably familiar with the verbiage in the Constitution, this immediately struck me as odd. Sure enough, when I went to the document itself, no such provision was anywhere to be found. The actual text of Article IX, Section V, Paragraph VI of the Constitution reads (see page 81,
"Levy of taxes to pay bonds; sinking fund required. Any county, municipality, or other political subdivision of this state shall at or before the time of incurring bonded indebtedness provide for the assessment and collection of an annual tax sufficient in amount to pay the principal and interest of said debt within 30 years from the incurring of such bonded indebtedness. The proceeds of this tax, together with any other moneys collected for this purpose, shall be placed in a sinking fund to be used exclusively for paying the principal and interest on such bonded debt. Such moneys shall be held and kept separate and apart from all other revenues collected and may be invested and reinvested as provided by law."

There is no mention whatsoever of transferring bonded indebtedness from a sales tax to property tax, just a general provision that a sinking fund to repay bonds be in place before such bonds are issued. Explicitly contrary to my reading of the CCSD’s resolution, the Constitution is mute on the subject of transferring any shortfall in sales tax collections to property tax “to the extent that revenues from the Sales Tax are not sufficient therefore.”

After an even longer and more circuitous journey through a variety of local and state government bureaucracies – the Attorney General’s office clammed up on me this time – I eventually discovered, after speaking with a bond attorney over in Atlanta, that the answer can be found in O.C.G.A. §48-1-121(c):

"No general obligation debt shall be issued in conjunction with the imposition of the tax unless the governing authority of the county or qualified municipalities within special district issuing the debt determines that, and if the debt is to be validated it is demonstrated in the validation proceedings that, during each year in which any payment of principal or interest on the debt comes due the county or qualified municipalities within special district issuing such debt will receive from the tax authorized by this part net proceeds sufficient to fully satisfy such liability. General obligation debt issued under this part shall be payable first from the separate account in which are placed the proceeds received by the county or qualified municipalities within the special district issuing such debt from the tax authorized by this part. Such debt, however, shall constitute a pledge of the full faith, credit, and taxing power of the county or qualified municipalities within the special district issuing such debt; and any liability on said debt which is not satisfied from the proceeds of the tax authorized by this part shall be satisfied from the general funds of the county or qualified municipalities within the special district issuing such debt."

Okay, that answers the question as to on what legal basis a shortfall in SPLOST sales taxes may be transferred to property taxes, though it is not explicitly stated in that manner.

But the question remains: why did not the CCSD’s bond resolution cite this section of state law? Why make language up out of whole cloth and claim that it is in the Constitution, when a few seconds on the Internet reveals that claim to be patently false?

Finally, consider the games that can be played with millage rates when they are considered irrespective of the “rollback rate“. This from another TOA post from May of 2009 ( The 0.3 mills reduction in 2004 was due solely to the work of members of the Clarke County Republican Party, who analyzed the budget and presented a list of potential reductions to the folks down at City Hall. To their credit, the Mayor and Commission did adopt many of our recommendations, thereby “freeing up” funds for a millage rate reduction. It should never be forgotten, though, that the original plan was simply to spend the new revenue generated by growth in the tax digest (this last part always seems to get left out of the discussion).

The 0.6 mills reduction in 2005 was a sham, pure and simple. The millage rate reduction was offset by the institution of the stormwater utility fee (even the Unified Government’s budget documents acknowledged this) which, by design, also hit those property owners such as churches and schools who are exempt from property tax. Now, we will have the situation where the millage rate is back to within 0.2 mills of where it was prior to the imposition of the fee – a fee that will be with us forever regardless of future millage rate hikes. Because of increases in assessments the “rollback” rate in any given year may well be lower that the millage rate - so property taxes can actually go up if the millage rate stays constant or, in some cases, even goes down.

For what it is worth, my assessment and estimated tax notice arrived in the mail on Friday; after increasing in 2008 and remaining the same in 2009 and 2010, this years fair market value dropped (finally) by 11.61% - as well it should have.

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Father's War Stories Were Told Sparingly

Read the column here (30 May 2011),

I have striven for accuracy in reconstructing my father’s military service, but readers are advised that records are not always available and that sources do not always agree. Also, based on my further research, it appears that my dad received his training as a cook at Camp Butner, after returning from Europe, not at Fort McClellan as part of his basic training as I had originally supposed in my initial column back in January.

I would like to thank Rodney Davis for responding to that column about my father’s decorations with some helpful links to information on the Internet concerning the 4th ID.

Some of the resources I used in addition to my father’s papers were:

National Personnel Records Center - Family members of a deceased veteran can order copies of services records, which I did. In the event, the NPRC was not able to provide me with anything useful that I did not already have. Said its response to my request, “The [July 12, 1973] fire destroyed the major portion of records of Army military personnel who separated from the service between 1912 through 1959 . . . Fortunately, there were alternate records sources that contained information which was used to reconstruct some service record data lost in the fire. However, complete records could not be reconstructed.”

To order such records, see:

for replacing lost or damaged decorations, see:

U.S. Army Center of Military History - For organizational information concerning the 4th ID’s participation in the European Theater of Operations, consisting of wartime command and staff officers, statistics (chronology, casualties, individual awards), composition (constituent units), attachments, detachments, and command posts, see:

For the Combat Chronicle of the 4th ID, see:

For the 4th ID’s designation as a “liberating unit” by the U.S. Army’s Center of Military History and the United States Holocaust Memorial Museum, see:

For the use of the Cunard Line’s Queen Mary as a troop transport, see:

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Friday, November 18, 2011

Democrat Will Face Tough Odds In House Race

Read the column here (12 June 2011),

For the inquiring minds out there, here is my documentation. As always, the percentage calculations are my own.

Maps of House District 113


Athens-Clarke County:

2004 election returns


Athens-Clarke County:

2006 election returns


Athens-Clarke County:

2008 election returns:


Athens-Clarke County:

2010 election returns


Athens-Clarke County:

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County Insists On Fighting No-win Battles

Read the column here (26 June 2011).

For those who may want to read the source documents for themselves.

Order Granting Partial Interlocutory Injunction; see page 5 for county attorney’s threat to have Mr. Stiles arrested and to personally prevent him from getting any construction variances, as well as City Hall’s plan to contract with the ADDA in an area that “. . . does not lie within the confines of downtown Athens as defined by the legislative act that created the ADDA. These efforts to induce the ADDA to engage in unauthorized conduct continue at the present moment . . .,’ see pages 19-20 for the ADDA being regarded as trespassers on the property in question:

Downtown Development Authority Facts; see for information about how Downtown Development Authorities were/are created and their powers:

Downtown Athens Development Authority - Proposed Amendment to the Constitution (1975):

Downtown Athens Development Authority Created (1977); see Section 2, pages 2-3 of the .pdf, for the strict and precise delimiting of “Downtown Athens area:

Downtown Athens Development Authority Act Amended (1980):

Downtown Athens Development Authority - Local Constitutional Amendment Continued (1987):

Marsh Open Records - Produced; response to an records request by John Marsh, see pages 7-13 of the .pdf for January through March billing of $13,215.56 (and note, again, that more bills will be forthcoming, as the hearing was not until April and the Order was not issued until late May - and now we get to pay for an appeal to the Georgia Supreme Court):

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Political Consensus Isn't Meant To Be Easy Goal

Read the column here (10 July 2011).
For the Declaration of Independence, Articles of Confederation, Constitution, Bill of Rights, and other Amemdments, see here:

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Redistricting Work Should Give Voice To Students

Read the column here (24 July 2011).

If readers think that these proposals sound familiar, they are correct. I advocated both as good government measures when I ran for the District 1 seat on the Athens-Clarke County Commission back in 2006. Other than the passage of time, absolutely nothing has changed and I still think that both would be a worthwhile endeavors. Of course, they were both ignored them back then. I don’t have high hopes for this time around, either.

Georgia General Assembly Joint Reapportionment Office:

Georgia Secretary of State Redistricting/Reapportionment Archives:

NSCL Redistricting Commissions and Alternatives to the Legislature Conducting Redistricting:

NCSL Redistricting Commissions: Legislative Plans:

Media coverage of my 2006 campaign regarding local redistricting:

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Tuesday, November 15, 2011

No Guarantees On Getting Social Security

Read the column here (06 August 2011).

This column proved to be something of a trial to write. Not in a conceptual sense, mind you, as I am familiar with the argument and sources and have written on this topic in earlier letters to the editor and blog posts.

The problem was one of having too much to say. What started out as a relatively simple 750-word Sunday column took on a life of its own as I delved deeper into the details of the argument – at one point I was even considering a four-part series: 1) an analysis of and commentary on the provisions of the Social Security Act; 2) an analysis of and commentary on Helvering v. Davis; 3) an analysis of and commentary on Flemming v. Nestor; and 4) an analysis of and commentary on the details of the Social Security Trust Fund (on which I still may pen something).

Such an extensive undertaking may well have been intellectually satisfying, but would involved far more time and effort than I really have to devote to it. Besides, seeing as how my columns are published on a bi-weekly basis, I fear that readers’ eyes would simply glaze over long before two months of this topic made it to print.

Thus, a retrenchment was in order. Be that as it may, though, readers are invited to review some of the source material for themselves and take it from there:

United States Code, Title 42 Chapter 7 - Social Security; see specifically Section 1304:

Helvering v. Davis:

Flemming v. Nestor:

And just for fun, see Social Security Retirement Benefits by Date of Birth (full retirement age is already 67 for anyone born after 01 January 1960 - and is just going to increase from there so get ready for it):

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Face Hard Truths About Social Security

Read the column here (21 August 2011).

These two letters to the editor from back in 2005 formed the starting point for my recent forays into the murky world of Social Security:

Social Security provides no guarantee of income

Social Security Trust Funs is merely a fiscal fiction

The federal bureaucracy sources used in the column:

Social Security Administration Trust Fund Operations

Social Security Trustees 2011 Annual Report Summary

OMB Analytical Perspective FY 2000 Budget

Some additional thoughts in no particular order:

From 1937 through 1958, Social Security ran surpluses every year. Form 1959 through 1981, it ran deficits in eleven years (1959, 1961, 1962, 1965, 1975, 1976, 1977, 1978, 1979, 1980, and 1981). It ran surpluses every year from 1982 through 2009 (it technically ran a surplus in 1982 but borrowed from Hospital Insurance Trust Fund, repaying the money in 1985 and 1986 - see below). Those surpluses peaked in 2007 and dropped in 2008 and 2009. The system began running what in all probability will be permanent deficits in 2010.

Just to muddy the waters, be aware that there are several trust funds: Social Security trust funds include the Old Age and Survivors Insurance Trust Fund (OASI) and the Disability Insurance Fund (DI); the term “Social Security Trust Fund” usually refers to a combination of the OASI and DI funds (OASDI). Medicare trust funds include the Hospital Insurance Trust Fund (HI; Medicare Part A) and the Supplementary Medical Insurance trust Fund (SMI; Medicare Part B and Part D).

Social Security benefits were exempt from the federal government’s taxation of income from the inception of the system in 1935 until a 1983 amendment to the Social Security Act specified that taxpayers who had income above a specified threshold would be subject to income tax on 50% of their Social Security benefits. The amount of Social Security benefit subject to income tax rose to 85% under the 1993 Omnibus Budget Reconciliation Act.

From what I could piece together from various sources, it appears that from the time federal accounting practices changed under the Johnson administration until some time during the Reagan presidency, the Trust Fund contained real bonds; from that time during the Reagan administration until some time in the Clinton administration the Trust Fund contained a mixture of real and “special issue” bonds; since that time during the Clinton administration, the Trust Fund has contained nothing but the “special issue bonds. I could not independently verify this timeline so I did not include it in the column but, given my knowledge of what happened and when with regard to the Trust Fund, it seems reasonable.

Even the amount of money ostensibly in the Social Security Trust Fund is nothing more than an educated guess (perhaps a better word term be “balance,” as there is no actual “money” involved). Each month, the Treasury estimates how much of the government’s aggregate revenue is derived from Social Security payroll taxes and “credits” that amount to the Trust Fund, then subtracts the amount of benefits paid out for the month to arrive at a figure.

Approximately 42% of federal government spending these days is done on the basis of borrowed money. Of that borrowed money, something like 70% of all of the bonds sold by the Treasury this year have been bought by the Federal Reserve. I can’t see any good is going to come of this practice.
The manner in which the term “national debt” is typically used includes intergovernmental debt, which is what one part of the government owes another; the more useful term “publicly held debt” does not. To those outside of the government, what it owes to itself is irrelevant. The important figure is what does government owe to others.

This discussion does not touch on the matter of the “net-present value” calculations that the Social Security Board of Trustees must by law consider annually for the upcoming 75 year period. This is where the discussion of “unfunded” Social Security benefits begins. When the special issue bonds in the Trust Fund are projected to be totally depleted in 2036 (even that year is suspect, as stagnant economic growth and a shrinking base of taxpayer will further hamstring the system), projections are that the system will be lacking funds to pay the full amount of promised benefits to the tune of trillions upon trillions of dollars (projections vary widely, but all involve an absolutely tremendous amount of money). Regardless of the specific amount involved, a projected 27% across the board decrease in benefits will have to occur to keep the system creaking along. Note that this is money that, were it deposited into the system today, would be needed to cover projected benefits over and above the payroll taxed collected over the period and is irrespective of the mythical solvency of the Trust Fund.

And finally, as bad as the finances for Social Security are, those for Medicare are far, far, far worse. For just how bad, see the Social Security and Medicare Boards of Trustees report for 2011.

By the way, the Social Security Trust Fund is currently "credited" with approximately $2.6 trillion in those "special issue" bonds.

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Economic Studies Bode Ill for River District Plan

Read the column here (04 September 2011).

“Review of: The Athens-Clarke County Unified Government,” prepared by the 2010 Overview Commission (January 2011).  This document used to appear on the old version of the Auditor’s page of the Unified Government’s web site; it did not make the transition to the newer, expensive version:

“Community and Economic Development Assessment of Athens-Clarke County,” funded by Georgia Power Company and prepared by Janus Economics (August 2011):

“Evaluation of the Feasibility of Creating an Oconee Riverfront Economic Development District,” prepared by Pathfinder Consulting/Bleakley Advisory Group (June 2011):

Georgia Department of Community Affairs 2011 Directory of Registered Local Government Authorities (enter “Athens-Clarke” as city/county and “development” as type to see the various development authorities):

Economic Development Foundation:

Athens Area Chamber of Commerce:

Unified Government’s Human and Economic Development Department:

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Development Work Done In Many Ways

Read the column here (18 September 2011).

Though I am gratified to see that Project Blue Heron is dead, I still think that the various departments, authorities, and nonprofits mentioned above need to develop a coordinated economic development strategy - insofar as they can, that is. I realize that their objectives and approaches vary and, to a certain extent, therein lies one of the many problems that we face.

Be that as it may, this column got whittled down a bit in the editing process (not a complaint, merely an observation), so here is some additional information:

Athens Clarke-County Human & Economic Development Department:

Georgia Department of Community Affairs:

Local Government Authorities

Definition of Authority Terms

2011 Directory of Registered Local Government Authorities

Athens Downtown Development Authority:

Joint Development Authority of Northeast Georgia:

Athens-Clarke County Economic Development Foundation:

Follow the links above to differentiate between "constitutional" and "legislative" authorities and among the three "single-jurisdictional” authorities, operating only in Athens-Clarke County, and the two “multi-jurisdictional” ones that include other counties.

The Athens-Clarke County Industrial Development Authority (IDA) is the traditional development authority that most think of when they hear the term “development authority.” This authority is often, though incorrectly, referred to as the “Economic Development Authority.”

The Economic Development Foundation was formed as an IRS 501(c)(3) nonprofit organization.

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Monday, November 14, 2011

SCHS Pigskin Update

Since we last checked in with my alma mater Indians, the team has experienced both the thrill of victory and the agony of defeat (he says in his best Jim McKay voice).

The team finished up the regular season with a 39-14 win at North Hall, thereby ending the season with an unblemished Region 8AAA mark and a Region 8AAA Division A championship.

The next week, it was back to Hall County to face perennial power and Region 8AAA Division B champion Gainesville in the “play-in” game. The Red Elephants soundly thumped the Indians 62-7 (ouch!).  Even with the loss, though, SCHS secured the second seed in Region 8AAA.

In the first round if the state playoffs, the Indians hosted the Cedartown Bulldogs, the third seed from Region 7AAA, and posted a 21-14 win at The Reservation.

In this week’s second round of the state playoffs, SCHS (9-2) makes the very long road trip to Grady County to face Cairo.  The Syrupmakers (9-2), the number seed out of Region 1AAA, knocked off Perry in the first round.

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My Comments On My Columns

I see that online comments are no longer being archived with their corresponding Banner-Herald articles. That being the case, I have started posting my "comments" to my columns here, as I frequently use the comment board to supply readers with additional information, citations, etc. (a process that will take a while and which I will undertake in reverse chronological order).

I will provide links to the columns, which remain on the OnlineAthens web site.  The copyrights on the columns themselves are held by Morris Communications for two weeks after they run, at which point they to devolve me.

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Moratoria Aren't Good Government

Read the column here (02 October 2011).

The column that I had originally planned ran very much along the same lines of Myra Blackmon’s most recent one. After all, pointing out that we need a shared vision of what constituted “historic” for the purposes of historic preservation is an obvious corollary to my point that we need a shared vision for the purpose of economic development. Anyway, Myra beat me to the punch.

As a fallback, I was preparing one of my “informational” efforts concerning the Athens-Clarke County Historic Preservation Commission. Then, in last Tuesday’s edition there appeared the story about our betters down at City Hall enacting yet another development moratorium – naturally with no public notice of which to speak – and the current column pretty much wrote itself. Perhaps I will revisit the one about the A-CCHPC later on.

For the “moratorium on moratoriums” comment, see:

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'Historic' Is Subjective Judgment

Read the column here (16 October 2011).

For the details governing City Hall’s local historic preservation efforts, see Chapter 8-5 of the Unified Government’s code:

For the Athens Clarke-County Historic Preservation Commission web site and links to various design guidelines, maps, reference material, etc., see:

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School SPLOST Is New Tax

Read the column here (30 October 29011).

O.C.G.A. really doesn’t make a distinction between county SPLOSTs and school district SPLOSTs insofar as terminology is concerned, and whatever terminology is used by others is frequently used inconsistently. For the sake of clarity, I have used the term “ESPLOST-4”. That is the term used by Charlie Maddox in his earlier opinion piece, short for Education SPLOST 4, which appears to be the preferred term of the CCSD.

When I cast my “early” vote down at the Board of Elections office on Tuesday, 18 October, no sample ballot had been posted on the Board’s web site. I do not know when the sample ballot was posted, but it can now be found here:

Here is the resolution approved by the Board of Education back during its called meeting of 27 June, 2011 on which the above ballot resolution is based. I got it from the Clarke County School District’s PR office, as the attachment was not included in either the online agenda or minutes archived on the CCSD web site for the meeting (it was the first item under New Business). Note that it is just as vague and unspecific as the ballot resolution (county governments and school districts having learned the utility of vagueness insofar as their SPLOST project descriptions are concerned – can you say “Tennis Center?”):

For the legalese that covers these matters, see O.C.G.A. Title 48, Chapter 8, Article 3, Part 1 (County Special Purpose Local Option Sales Tax) and Part 2 (Sales Tax for Educational Purposes):

Clarke County School District Education SPLOST FAQs (I also have a separate 2-page PDF specifically on Education SPLOST-4 that was on the CCSD web site, but I cannot find that link now):

A trio of further thoughts:

Years ago, I asked some questions as the result of the approval of ESPLOST-3 and its associated bond issue. The CCSD’s portion of the local property tax millage rate has been at the 20 mills limit for years; to exceed that limit would normally require the voters’ approval to do so via a referendum. So how could that limit be administratively traversed so as to make up a SPLOST revenue shortfall without a referendum? After a long and circuitous journey through a variety of local and state government bureaucracies, the Attorney General’s office provided me with the relevant Georgia Supreme Court case law, Seaboard Air-Line Railway Company v. Wright, comptroller-general, et al., from way back in 1927, that exempted bond debt service from any constitutional limit. I do not agree with the reasoning embodied in that decision, as it would seem to render the rationale for the 20 mills limit moot, but the case law is what it is.

In order to raise ESPLOST-4's hoped-for $24 million per year in sales tax revenue rather than the expected $21 million per year, the purchase of an additional $300 million per year of taxable goods and services would have to occur in Athens-Clarke County. That works out to a $1.5 billion increase in taxable purchases over the five-year duration of ESPLOST-4. Any such increase is highly unlikely – and how – so why word the referendum that way? Because the CCSD is greedy and wants to hedge its bets just in case, that is why. And if $105 million is expected to pay for the projects included in ESPLOST-4, for what would the additional $15 be used?

Ostensibly, the idea is that by issuing bonds, thereby getting a significant portion of the levy’s anticipated revenue immediately, any construction costs increases that occur over ESPLOST-4's five-year duration can be avoided (this practice is typically referred to as “forward funding”). “Ostensibly,” I say, because when I quizzed the powers that be over how much money the CCSD was going to save by employing this strategy with the bonds issued as a part of ESPLOST-3, none of them could even hazard a guess as to how much would be saved, or even how such a figure may be calculated. I, like they, was just supposed to accept the reasoning as a matter of unverifiable faith. Besides which, I would argue the assumption that construction costs must invariably rise has been disproven in recent years.

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Sunday, November 13, 2011

Questions About Clarke ESPLOST

Read the column here (13 November 2011).

The eighth paragraph should read, with a close quotation mark: . . . indebtedness of the school system." If no such debt exists . . .

As I noted in the comments for my previous column:

“O.C.G.A. really doesn’t make a distinction between county SPLOSTs and school district SPLOSTs insofar as terminology is concerned, and whatever terminology is used by others is frequently used inconsistently. For the sake of clarity, I have used the term 'ESPLOST-4.' That is the term used by Charlie Maddox in his earlier opinion piece, short for Education SPLOST 4, which appears to be the preferred term of the CCSD.”

Even so, the preferred terminology seems to have changed over time; note that ESPLOST-4 and SPLOST 4 are the same thing (as are ESPLOST-3 and SPLOST 3).

I must confess that the folks over at the Department or Revenue get high marks insofar as helping me out is concerned. When I first called in with my questions, I got transferred/referred hither and yon which, of course, is par for the course. I finally ended up in the telephone of an attorney in the Office of Tax Policy who could not have been nicer or more helpful. Over the course of several conversations, we reviewed with the applicable provisions of the Constitution, O.C.G.A., and the Department of Revenue regulations (with which I am familiar and had right in front of me before I made any calls). Additionally, the good fellow searched case law and opinions issued by the Attorney General’s office. He then referred me to another fellow in the Local Government Services Division (formerly the Property Tax Division) with whom he had discussed my questions and I covered the same ground with him. Although they would not tell me that I was legally correct, not being in the business of providing “legal advice” to folks on the telephone, neither could they, on the basis of whatever material to which they had access, point out were I was incorrect. In fact, both indicated that mine would seem to be a “reasonable interpretation” of the issues involved.

Be that as it may, here is the source material for you to read for yourselves:

State of Georgia Constitution Article VIII, Section VI, Paragraph IV

(a) . . . This tax shall be at the rate of 1 percent and shall be imposed for a period of time not to exceed five years, but in all other respects, except as otherwise provided in this Paragraph, shall correspond to and be levied in the same manner as the tax provided for by Article 3 of Chapter 8 of Title 48 of the Official Code of Georgia Annotated, relating to the special county 1 percent sales and use tax, as now or hereafter amended. . .

(b) The purpose or purposes for which the proceeds of the tax are to be used and may be expended include:(1) Capital outlay projects for educational purposes;(2) The retirement of previously incurred general obligation debt with respect only to capital outlay projects of the school system; provided, however, that the tax authorized under this Paragraph shall only be expended for the purpose authorized under this subparagraph (b)(2) if all ad valorem property taxes levied or scheduled to be levied prior to the maturity of any such then outstanding general obligation debt to be retired by the proceeds of the tax imposed under this Paragraph shall be reduced by a total amount equal to the total amount of proceeds of the tax imposed under this Paragraph to be applied to retire such bonded indebtedness. In the event of failure to comply with the requirements of this subparagraph (b)(2), as certified by the Department of Revenue, no further funds shall be expended under this subparagraph (b)(2) by such county or independent board of education and all such funds shall be maintained in a separate, restricted account and held solely for the expenditure for future capital outlay projects for educational purposes; or(3) A combination of the foregoing.

(h) Excess proceeds of the tax which remain following expenditure of proceeds for authorized projects or purposes for education shall be used solely for the purpose of reducing any indebtedness of the school system. In the event there is no indebtedness, such excess proceeds shall be used by such school system for the purpose of reducing its millage rate in an amount equivalent to the amount of such excess proceeds.

O.C.G.A. Title 48, Chapter 8, Article 3

Part 1 County Special Purpose Local Option Sales Tax

§48-8-110. Definitions(1) "Capital outlay project" means major, permanent, or long-lived improvements or betterments, such as land and structures, such as would be properly chargeable to a capital asset account and as distinguished from current expenditures and ordinary maintenance expenses. Such term shall include, but not be limited to, roads, streets, bridges, police cars, fire trucks, ambulances, garbage trucks, and other major equipment.

§48-8-111. Procedure for imposition of tax; resolution or ordinance; notice to county election superintendent; election

This section gives lots of examples of permissible “capital outlay projects” for a variety of different categories, none of which even remotely sounds like the study the CCSD is wanting to retroactive fund using SPLOST-4 revenue.

Part 2 Sales Tax for Educational Purposes

§48-8-140. Authority for and legislative intent of articleThis part is enacted pursuant to the authority of Article VIII, Section VI, Paragraph IV of the Constitution of Georgia and it is the intent of the General Assembly in the enactment of this part to further define and implement such provision of the Constitution.

Department of Revenue Regulations - Sale and Use Tax Division

Chapter 506-12-7 Educational Local Option Tax560-12-7-.01 Definitions.(1) The term “Educational Local Option Tax” as used in these regulations shall mean the1% sales and use tax for use by the School Board of such counties and/or independent school boards as authorized under provisions and conditions of Article VIII, Section VI, Paragraph IV of the Georgia Constitution.(2) The term “Educational Local Option Tax Act” as used in these regulations shall mean Act No. 19 (Resolution No. 728) set forth in the Georgia Constitution authorizing a 1% sales and use tax for such School Board or School Boards of Education located within a county.(3) The term “School Board” as used in these regulations shall include any Board of Education of such school district in a county or the Board of Education of any independent school district authorized to levy an Educational Local Option Tax under the authority of Article VIII, Section VI, Paragraph IV of the Georgia Constitution.(4) The term “State Sales and Use Tax Act” as used in these regulations, shall mean the Georgia Retailers’ and Consumers’ Sales and Use Tax Act, approved February 20, 1951(Ga. L. 1951, p. 360) as amended.

Clarke County Board of Education - Minutes of September 2010

Board approval was requested for a contract to complete a district-wide building and site condition assessment related to planning for SPLOST 4 needs and priorities. A Request for Proposals was advertised in the local newspaper and posted on the School District website. Twenty-four firms attended the mandatory pre-proposal meeting and nine firms responded. Guaranteed maximum prices for the scope of work ranged from $37,500 to $391,000. All submittals included commitments to meet the completion deadline of November 12, 2010.

The costs shall be forward funded and included as a reimbursable amount in the referendum for SPLOST 4.

Superintendent’s recommendation: Approve a contract with SP Design Group at a Guaranteed Maximum Price of $37,500 and establishment of a $10,000 contingency for owner-requested additional services.

See pages 3-4 for the agenda item, which was passed by unanimous vote as part of the New Business Consent Agenda

Clarke County Board of Education – Minutes of June 2011

Memorandum: Funding for Architectural Services (Maxine P. Easom Elementary)

The maximum design phase expenditure will be four percent (4%) of the construction budget of $9.1M (total design cost $364,000).

The proposed construction schedule for this new school, if approved by the voters in the November 2011 SPLOST 4 referendum, requires commencement of the project in early 2012. Thus, the design work must begin very soon to meet this accelerated schedule.

Funding for the design costs will be provided in the SPLOST 3 budget for general contingencies.

On both the agenda (page 44) and the minutes (page 2), the item is the second one under New Business. It passed by unanimous vote.

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