Mayor Reed loses composure over Beltline funds owed to APS

Atlanta Mayor Kasim Reed made a series of angry statements about the Atlanta Public School’s desire to be paid the nearly $20 million owed to APS by the Atlanta Beltline project. The contractual amount owed to APS is not under dispute. However,  because the project has not lived up to its billing in terms of  the increase in property values and the projected increase in property taxes resulting from a higher valuation, the City of Atlanta (that is a party to the contract) wants to renegotiate the amounts due.

Outgoing Superintendent Davis entered into discussions with the Beltline and has offered a number of reasonable alternatives for how APS would be paid, however the City’s and the Beltline’s response has been completely inadequate. As a result, Davis has left all options on the table.

For more background on the Beltline issue, see the AJC article here.

As reported by WSB – see here,

But what infuriated Reed is that Davis threatened legal action and admitted to doing so to the Atlanta Journal-Constitution. “Nobody’s going to negotiate at the end of a gun. So, if you’re going to take hostages, you’d better be ready to shoot the hostages,” Reed said to Davis at an Atlanta Beltline board meeting last week….Reed also offered a blunt analysis of political realities in Atlanta.“The Atlanta Beltline is the most popular public project in the entire city of Atlanta — by a lot — more popular than APS,” Reed said. 

So let’s tee it up, and let’s go. You take the actions you need to take, but I want you to be clear, I’m going to be equally aggressive in addressing whatever you do,” Reed said.

APS board member Brown, who also represents APS on the Beltline board,

… sent Belcher an email Wednesday afternoon that said, in part, “For over a year, APS has tried to resolve these issues. Our commitment to the beltline is unquestionable, but our first responsibility is to the children of Atlanta.”

This is a reasoned response in the face of an unreasonable and ugly public outburst by Reed.

Is that assessment of Reed to harsh? Let’s look at the facts:

  1. The contractual amount is not in dispute – the City simply does not want to live up to its commitments.
  2. APS has willingly entered into negotiations with the Beltline, but the Beltline’s (and the City’s) response has been wholly inadequate.
  3. After a lengthy period of time, Davis reasonably states that all options are on the table to bring the matter to a reasonable conclusion.
  4. The Beltline made the original projections on the value of the project and the corresponding value to APS – the project was sold to the citizens and contractual commitments were willingly entered into by all parties.
  5. The original contract has been amended at least two times, but no changes were ever made to the amounts promised to APS.
  6. The Beltline has fulfilled its monetary commitments to all other parties except APS.
  7. Mayor Reed, who is playing a very weak hand, loses his composure and lashes out at APS for simply asking the City to live up to the contract it signed.

I would suggest that, given the fact pattern, the Mayor – who appears to desperately want to have more influence on APS – is, once again going down the wrong track. Money inducements did not work earlier and it is unlikely his current stance on the Beltline issue will curry favor either.

Mayor Reed had a unique opportunity – an outgoing superintendent that wanted to clean up a mess; getting a problem issue off the plate of the incoming superintendent; a set of reasonable proposals by APS; a new Board that has been willing to take on tough issues; and, most importantly, the ability to come out in support of the Atlanta education system.

Mayor Reed – opportunity squandered!

I also wonder how the parents (and voters) of the nearly 50 thousand students in APS will view the Mayor’s position on this. For that matter, consider how property tax payers will view it – the $20 million owed is approximately equal to one millage point in school property taxes.

My sense is that this will not go over well with either constituent group.

8 Responses to Mayor Reed loses composure over Beltline funds owed to APS

  1. Beverly Fraud says:

    Kasim Reed, in yet another episode of child-like petulance, has done something heretofore thought impossible: he’s made APS look competent and reasonable.

    Now if you want a gander at APS’s true colors, look into their overtures towards hiring Glen Brock. A guy considered by many to be completely in bed with Mark Elgart and SACS…you remember Mark Elgart don’t you?

    The guy who along with (you guessed it) Kasim Reed, tried to strong arm former board chair El into resigning, so Burks-Butler, the woman who ACTIVELY CONSPIRED with Beverly Hall to cover up evidence of cheating, could be reinstated as board chair.

    Is APS such a lapdog to SACS that they have to hire Mark Elgart’s crony? The Mark Elgart who used the threat of yanking SACS accreditation because the “Furious Five” DARED to get to the bottom of the cheating scandal? This is who the new board wants to lie down in bed with?

    Yet another example of a new board that has NOT distinguished itself as being a fierce advocate for what’s best for children, but instead seems determined to align itself with those who have their own financial agenda, children be d@mned.

    Disappointing, yet not surprising.

  2. Daisy says:

    I wondered what the backstory was on this when I hear Reed’s rant. I am completely appalled. I can’t believe that he is using the unpopularity of Davis and the general perception of APS and the POPULARITY of the Beltline project to pose an argument AGAINST giving APS the funds they are due in what seems to be a real estate transaction.

    Shame on Reed! I for one, as a parent of a child in APS would like to see these funds transferred over right way, so that APS doesn’t start getting creative on how they are going cover the budget gap the loss of these funds might cause. Anyone remember the unfunded pension “creative bookkeeping” slam on charter schools?

  3. Andrea Knight says:

    @Beverly Fraud, However noble the motivation, however much I agreed with the sentiment, the vote to elect El chair and unseat Butler-Banks was improper and invalid. Any reasonable attorney would have advised the same.

    I’d be more concerned if APS were attempting to hire the attorney who advised the 5 that El’s election was valid.

  4. AN09 says:

    And Mayor Reid may just be getting that influence he wants, too. Jodi Merriday, one of Carstarphen’s new crew, is the former Director, Special Projects, Kasim Reed for Mayor & a former Project Manager for the City of Atlanta.

  5. Beverly Fraud says:

    @Andrea Knight,

    Are you forgetting when it went before the court the judge said it was completely and totally legal? It appears the only ones opposed where lackeys of SACS who appear to have been opposed for POLITICAL, not legal reasons.

  6. It seems kind of strange to say the Beltline “has not lived up to its billing” ignoring the fact that a historic recession had a pretty significant effect on Atlanta’s property tax receipts.

    • Thanks for the comment. The Beltline had several chances to revise its tax revenue projections and the related share with APS – and did not do so. The second amendment on the project was signed on November 11, 2009. The peak of the tax digest was on June 30, 2008 at $27.6 billion. It was down to $25.1 billion on June 30, 2009 or a 9% drop – well before the amendment was signed. It further decreased by another $1.1 billion during the period the amendment was signed. The Beltline should have modified the agreement back then – but did not do so. Additionally, changing the projections on which the project was sold is never a politically palatable idea – so they left the projections – and the related tax share with APS intact. As the projections made by the Beltline were not revised, they are stuck with them – and, as such – they have not lived up to their billings.

  7. roosting chicken watcher says:

    Shirley Franklin’s Chief of Staff stood up before a business association and said, when grilled by members about the shakiness of the Beltline TAD, that “property values will never go down.”
    The ADA / ABI was staffed with realtors making high finance decisions – not qualified economists with advanced degrees in appropriate fields.
    For those of you who don’t recollect, two very large developments were (illegally) hornswaggled into the TAD to make the “numbers work” for the revenue stream – City Hall East and Lindburg Plaza. So the books were cooked from the get-go.
    As the saying goes, “Never confuse marketing with reality”
    The did, and guess what, didn’t work.

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