WABE has more on the Beltline versus Atlanta Public Schools story

In a story filed yesterday, WABE (see here) provided additional information and quotes on the controversy between the Atlanta Public Schools and the Atlanta Beltline project.

As background, APS entered into a contract with the Beltline (which was also signed by the City of Atlanta) to defer certain property tax revenues so that the deferred taxes could be used to support the Beltline project. The advertised growth in property tax revenues did not occur as anticipated by the Beltline and now they want to renegotiate the $19+ million that is currently due to APS. The total contract has a value of approximately $165 million through 2030.

APS has offered several alternatives for payment, but the Beltline has not accepted the offers. Current Superintendent Davis indicated that all options – including a lawsuit – remained on the table and Atlanta Mayor Reed lashed back at Davis for even considering this. For more background on this, see prior post here.

Per the article at WABE,

Davis had recently told the Atlanta Journal-Constitution he wanted the contract dispute settled by the time he left office at end of this month. He added APS was considering legal action. Reed called the comments inappropriate and said the city won’t be rushed to settle. “There is no way this is going to be resolved by July 1. No way. So whatever you’re threatening to do you need to do it,” said Reed.

In 2005, the city and APS entered into a contract laying out how the Beltline would be funded. APS agreed to give up some of its property tax dollars. To help offset that, the city promised to make fixed annual payments to APS – payments based on the assumption that real estate prices would always rise.

[APS Board member and attorney Cynthia Briscoe] Brown says a contract is a contract. “Contract law is not designed for one party to suddenly decide, ‘I don’t like this. This is bad for me after all. I want to change the terms of the contract.’… “Nineteen million dollars would go a long way towards adding additional teachers so we are not interested in being difficult but we have a responsibility to the children of Atlanta to get this worked out.”

APS Chief Financial Officer Chuck Burbridge weighed in on the dispute and stated,

…school system is open to those discussions, but there’s still a lot of distance between the parties…”We’d rather not be as confrontational but of course obviously if there’s two sides looking at a contract then potentially you do have to bring in a third party to help take a look at the language,” said Burbridge. He said it’s in the best interest of all parties, especially the Beltline, to resolve their differences sooner rather than later.

The failure to reach a settlement on the dispute could have an impact on the Beltline’s funding and Reed believes the Beltline project has a higher priority in the minds of voters than APS,

[CFO Burbridge stated] “As long as this dispute exists the Beltline is precluded from selling bonds using our tax increment to support more rapid development as opposed to having to do it on a pay-as-you-go basis and having this uncertainty out there,” 

[Reed] …took particular issue with APS forcing the issue during a Beltline fundraising drive. “To do this while we’re trying to raise $6 million in four months I just think is awful… [FD note – the negotiations on the contract have been going on for over a year]

Reed said he won’t be pushed around. He said the Beltline is the most popular public project in the city and suggested residents won’t take kindly to APS getting in the way of its progress.

Per the article, Reed is digging in his heels and continued on in a combative manner,

“Let’s tee it up and let’s go. You take the actions you need to take and I want you to be clear: I’m going to be equally aggressive in addressing whatever you do,” said Reed. “There is nothing in my background in the four years that I’ve had this job that suggests I ever cave. It’s never happened.”

I find the Mayor’s position interesting on several fronts.

  • The negotiations have been ongoing for over a year and the Beltline has only offered very inadequate solutions. Where was Mayor Reed during this time? Why did he wait until the Beltline funding reached a potential crisis stage?
  • Does the Mayor really believe that the Beltline project has more political constituents than APS? I hope – for his sake – that the parents of the 50 thousand students in APS are not called on to answer that question. Is he really saying that property development is more important than education?
  • I thought successful politics represented the art of negotiation and achieving win-win outcomes whenever possible. Per Reed,

“There is nothing in my background in the four years that I’ve had this job that suggests I ever cave.”

Clearly Reed views it differently.

Reed has been desperately trying to gain more influence with the APS Board of Education and has been either rebuffed or ignored on most of his efforts. I am trying to figure out how this outburst and “tough guy” persona fits into his strategy.

[Follow me on Twitter @Financial_Decon]

One Response to WABE has more on the Beltline versus Atlanta Public Schools story

  1. Mary Jo Bryan says:

    I wonder if Reed feels like APS owes him if he was the one tasked with raising the corporate funds for the superintendent’s transition.

    Sent from my Droid.

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