Atlanta Board of Education approves agreement with the city on Gulch project

By Collin Kelley

The city has cleared another hurdle in its efforts to redevelop The Gulch property in Downtown by reaching an agreement with Atlanta Public School (APS) to settle issues regarding project development bonds.

As part of the agreement, APS will continue its participating partnership in the Westside TAD (tax allocation district) through 2038, while the City of Atlanta has agreed to a $10 million reimbursement of educational and infrastructure development costs incurred by APS on completed projects in the Westside TAD and an additional $1.25 million each year from 2020 to 2023. That brings the total reimbursement of such costs to $15 million.

APS has also agreed to a partnership in Atlanta’s four commercial TADS – Campbellton Road, Hollowell/M.L. King, Metropolitan Parkway, and Stadium – for 30 years. The city will pay off bonds on the Eastside TAD and make annual payments in lieu of taxes (“PILOT payments”) of APS’ portion of increment through the remaining life of the Eastside TAD. The city will continue to accept and review applications for funding for development projects within the Eastside TAD.

APS had gone to court to block the city’s move to use school taxes for the $5 billion mixed-use project, which will be developed by CIM Group, that inclues, offices, hotels, homes and retail.

According to a statement released by the board of education, the agreement reduces APS’ exposure in The Gulch deal from $1.56 billion to $1.38 billion, distributes the impact of the APS increment more evenly over the lives of the TADS, limits exposure of the APS tax digest to be no more than 10 percent of collectable digest in any given year (based on current assumptions) and relieves immediate pressure on the APS budget.

The agreement also provides a net gain of between $130 million and $180 million to APS over the life of the TADs.

In a statement Superintendent Meria Carstarphen thanked the city for “providing APS with a more predictable, manageable and sustainable way of contributing to and supporting economic development in the city, while balancing the interests of our 52,000 students, 6,000 employees and 158,000 taxpayers. In addition, this agreement caps our financial contributions in future TADs and sparks economic development in four TADs on the Southside, where so many of our students and employees live.”

Mayor Keisha Lance Bottoms, who has been the leading advocate for The Gulch development, said in a statement the “agreement brings the City to the final stages of what truly represents public-private innovation at its finest, revolutionizing economic development in Atlanta for generations to come. The passage of the APS Intergovernmental Agreement will elevate Atlanta’s schools, ensure more equitable development across the city and kickstart the transformation of the Gulch — one of the most significant redevelopment projects in the history of Atlanta. Thank you to the many members of our Administration and stakeholders who helped bring this deal to fruition. This is a remarkable day, as we take a historic step towards continuing our city’s progress, leaving no community behind.”

Meanwhile, a group of residents and stakeholders opposed to The Gulch, who have united in a group calling itself “Red Light the Gulch,” are still protesting the deal and hoping to block it with a legal challenge.