A recently introduced legislative bill, HB 1062, sets up a voter referendum on enacting the “Redevelopment Powers Laws” for Rockdale County. HB 1062 passed last week in the Ga. House and awaits a Ga. Senate vote.

If it passed, it would be the first step to enable the county to use future tax revenues for current development on blighted or economically depressed areas, or a Tax Allocation District, or TAD.

Leaders have also been discussing the possibility of expanding existing Opportunity Zones in the city and county. 

Both TADs and Opportunity Zones are both useful for economic development, said Conyers-Rockdale Economic Development Council Director Marty Jones. Neither is a magic bullet perfect for every project, but options are important. 

“It helps the math work,” Jones said. If finances are “iffy” on a proposed development, either or both can make the project work.

Opportunity Zone

The Opportunity Zone program is run by the state Department of Community Affairs and offers tax credits for new jobs created within a designated area.

Conyers Opportunity Zone, which started in 2010, covers about 425 acres located between West Avenue, Green Street, Ga. Highway 138, and Dogwood Drive. 

Rockdale County’s Opportunity Zone went into effect starting January 2012 within the nearly 2,000 acre industrial area between Sigman Road, Rockbridge Industrial Road, Covington Highway, and the city/county border. 

Opportunity Zones have been effective and Jones strongly supports expanding both the county and city’s Opportunity zones.

“They’d both be expanded, if I could wave my magic wand,” said Jones.

They’re a big deal in terms of statewide economic development competitiveness, he said. “You’re not just competing with yourself [in terms of properties inside or outside of zones]. You’re competing region-wide, statewide.” 

“It makes a difference to the buyer.”

He noted that throughout Georgia, there are about 350 large industrial properties on the market that are in an Opportunity Zone. 

Of those, only one is in Rockdale – the former Fieldstone Center in Conyers. The effort to expand the Conyers Opportunity Zone includes covering the former Acuity building. 

Likewise, statewide there are about 120 office-space properties over 10,000 square feet available that are in Opportunity Zones. Only one of those is in Rockdale. 

Jones emphasized that Opportunity Zones aren’t just for newcomers. They can help existing businesses expand and add employees with zero local costs and no new fees.

TAD

TADs, said Jones, are “another tool in the toolbox.” “It really helps in redevelopment. It’s a great tool for that.”

County Chief of Staff Gerald Sanders said they’re a way of staying competitive. “I’m a big believer in them because I’ve seen them work,” said Sanders. He cited TADs set up in Atlanta, Cobb County, Fulton County, and East Point.

In a TAD, a government uses the anticipated increased tax revenues from a property to finance the private development of that property. It assumes the property will increase in value with development. A portion of that future increased tax revenue is used to back bonds that a private developer can use.

“It helps incentivize the local market. It makes it more attractive,” Sanders said. A TAD does what an Opportunity Zone doesn’t, said Sanders. A TAD can help a developer with hard costs, such as building a bridge or landscaping or infrastructure.

TADs can bring benefits in certain situations but are a gamble for governments, according to Georgia State University’s Carolyn Bourdeaux and John Matthews, who authored a report, “Georgia’s Redevelopment Powers Law: A Policy Guide to the Evaluation and Use of Tax Allocation Districts.”

 When property values are rising but private developers are hesitant to take on the risk of developing a blighted are, TADs can be a useful incentive and tool to stimulate growth. 

One of the most successful examples of a TAD is Atlantic Station, which arose from a brownfield.

But, pitfalls come when the property value does not increase as anticipated. 

The City of Conyers instituted a TAD over the Olde Town Conyers area in 2007, just as the economy tanked. 

In the first year, the city collected about $5,000 to $6,000 in TAD revenue, which remains in an account, said City Finance Director Isabel Rogers. Since then, “We basically have a negative revenue when it comes to TAD,” she said.

Both she and Sanders noted TADs are much more effective when coordinated with adjacent jurisdictions.

“Normally, for a TAD to work, you really have to have all… jurisdictions going forward,” said Rogers. “It really works when everybody’s on board. The city does not have enough to be able to do anything on its own.”

The Georgia Supreme Court ruled in 2008 that education taxes cannot be used for economic development, which includes the education portion of any future tax revenues, according to the Georgia Municipal Association.

For more documents and information on TADs, go to www.rockdalenews.com or http://www.gmanet.com/MDR.aspx?CNID=22896