Members of the Porterdale City Council recently asked the city attorney to review the legalities of turning over lots owned by the city to their newly created Downtown Development Authority for the body to sell in order to generate funding.
City attorney Tim Chambers told the council at a special called meeting Nov. 19 that the council could do this if they accepted sealed bids, held a public auction or transferred the lots to the DDA for a public purpose.
"The third option is where is gets really complicated," Chambers said.
The four lots in question are all residential. Although the revenue from the sale of any lots would be used by the DDA, the residential nature of the lots creates a grey area for the public purpose tenet.
Chambers told the council that a "cleaner" option would be for the council to sell the lots outright and then give the funding to the DDA after creating clear criteria for the development of the lots.
Councilman Robert Foxworth said he was
uncomfortable with the idea of giving all of the funds from the sale of the lots to the DDA. He suggested that the council set a dollar amount such as $20,000 and anything more collected would go into the general fund.
"I think we need to keep in mind that we created the DDA for a purpose," responded Councilwoman Arline Chapman, "not just to hang another sign outside our door."
Foxworth said the city could not afford to fund the DDA 100 percent.
Other members of the council expressed reservations with holding a public auction or accepting sealed bids out of fear that those options would fetch an unsatisfactory amount for the lots.
"There were recently some lots in a prominent Newton County subdivision that a few years ago were going for $60,000 that sold for $4,000," said Mayor Bobby Hamby.
Chambers suggested that the council not sit on the property, but instead create a resolution saying that proceeds from the sale of the lots would go to the DDA. He also mentioned that Georgia law permits municipalities to add mils to ad valorem taxes for the purpose of funding a DDA.
Councilman Mike Harper, who also serves on the DDA and serves as the liaison between the council and the authority, said he wanted the council to adopt the resolution suggested by Chambers.
"We’re not going to go out here and do that work [of publicizing the availability of the lots] unless we get some kind of commitment from the council," Harper said.
The council voted to have Chambers prepare a resolution authorizing the sale of the four lots pursuant to Georgia statutes for the purpose of donating funds to the DDA. The vote passed four to one, with Foxworth voting no. The council will vote on the resolution at their Dec. 7 regular meeting.
Also at the Dec. 7 meeting, the council will hold the final reading of and a public hearing for next year’s budget. The proposed fiscal year 2010 budget includes a 3.5-mill increase in the town’s millage rate. According to City Manager Tom Fox, without the increase, layoffs/furloughs or cuts to city services would be necessary to balance the budget.