SOCIAL CIRCLE, Ga. - An annexation issue could cost the city of Social Circle its status as a Qualified Local Government through the Georgia Department of Community Affairs (DCA). This would make the city ineligible for nearly 20 federal and state grant and loan programs, including community development, emergency, housing, business assistance and historic preservation funding.

The city was notified of pending DCA action to decertify the city as a Qualified Local Government in a Feb. 17 letter to Mayor David Keener. The letter gave the city seven days to respond to DCA concerns about the city council’s decision on Nov. 18 of last year to annex nearly 700 acres in Newton County.

That response, which was to include information refuting Newton County’s assertion that the property has already been annexed, or outlining an agreement between the county and the city noting resolution of the issue, was sent to the DCA on Feb. 24. This was reportedly within the DCA deadline, according to Social Circle City Manager Eric Taylor.

As of early Wednesday afternoon, the city had not heard anything from the DCA, Taylor said, later adding that he and other city officials “believe we will prevail” in the situation.      

The Nov. 18 annexation was intended to set up development of a 12-building data center covering 2.5 million square feet on just 56 acres of the site near Georgia Highway 11 and along Lakewood Drive.

At the time of the city council’s decision to annex the Newton County acreage, Newton County commissioners had already filed a petition for DCA arbitration of the issue. The arbitration process involves a panel comprising two city representatives, two county representatives, and an academic expert appointed from a pool maintained by the DCA.

The arbitration panel was appointed on Nov. 12, six days prior to the council decision to annex the Newton County property.

In the Feb. 17 letter to the city, Jon West, director of the DCA’s Community Development Division, cites the city’s “apparent actions to annex the property prematurely,” in advance of any meeting of the arbitration panel, as the rationale for DCA consideration of revoking the city’s status as a Qualified Local Government.

Prior to giving the city seven days to respond, West’s letter notes that the DCA “… does not believe that such an action (the council vote to annex the property)  is representative of … good faith negotiations … .”

The letter also notes that while DCA can’t compel any local government to participate in annexation arbitration, “… such participation is highly incentivized through DCA’s certification of ‘qualified local governments’.”

In the city’s Feb. 24 written response to the DCA letter, Social Circle City Attorney Tony Powell contended the council’s Nov. 17 vote did not represent the final action on the annexation.

Instead, Powell contended that under state law, the “final action of a city in an annexation … is not the approval of the mayor and council, it is the submission to the Department of Community Affairs.” Under state law, no annexed areas can be added to the state map until a report of the action is submitted to the DCA.

Also in the city’s response, Powell noted that the city willingly participated in an effort requested by Newton County officials to negotiate a settlement regarding the annexation, but the county ultimately did not respond to what the city had considered an effort that was “… extremely close to resolving all issues … .”

Instead, according to both the DCA letter and the city’s response, Newton County officials used a Feb. 13 letter – three days after the deadline for the arbitration panel to produce or adopt findings on the disputed annexation – to note the council’s Nov. 18 annexation vote.

Powell wrote in the letter to the DCA that “Social Circle conducted itself in good faith in participating in the arbitration process and in negotiating with Newton County.”

As a result, Powell concluded in the letter, “We believe that a decertification of Social Circle’s status as a qualified local government would not be reasonable in this case and would be an extreme measure in light of the circumstances.”