BCN Members Version – PDF (login required).
I. Welcome & Introductions
Jim King called the meeting to order at about 6:40 PM. A quorum was present at times during the meeting.
II. Approval of Minutes
Minutes for the May meeting were not approved due to the loss of the quorum.
III. Admit New Member Neighborhoods
No neighborhoods asked to be admitted to BCN.
IV. Guest Speaker
Hon. Aaron Watson, Atlanta City Councilman
Aaron Watson is the at-large member of the Atlanta City Council for our area. Aaron serves on the Utilities and Transportation Committees. He also serves on the Finance Committee. Aaron is a resident of Morningside and works as a lawyer in the Prominence Building in North Buckhead. In the ‘80s, Aaron served a couple of terms on the Atlanta Board of Education. He was appointed to the Atlanta Housing Authority and helped to “tear down most of the deplorable public housing” in the city and replace those units with decent mixed income housing. He also served on the Atlanta Development Authority for many years. He served as president of the Piedmont Park Conservancy and oversaw substantial increases in the park’s acreage. Aaron provided review of the City Council’s recent accomplishments and future challenges:
- Pension Reform (a $1.4 billion unfunded liability), though the Council still needs to get a handle on other post-employment benefits (another $1.4 billion unfunded liability). He said that retiree’s spouses and kids (and sometimes kids’ kids) receive medical coverage. [See “Pension and medical benefits” on the next page for more details of this unusual coverage.]
- The city’s revenues have decreased by about $100 million over the current four-term, yet tax rates were not increased.
- He expects that they will have a balanced budget in another month or so. He anticipates a modest raise in employee pay (“nothing big”). He hopes the city’s revenues will increase next year and pay increases for police and fire will be possible.
- The staffing of the police department has been increased to almost 2,000 officers.
- He said they will probably float some bonds next year to begin addressing infrastructure needs (bridge and road work and sidewalks).
What funding is available? Aaron said “Virtually none.” The city’s philosophy has been that sidewalks are the responsibility of property owners – “that has led to what we have”. We have a lot of work to do. He suggested we express our desires to our councilmembers. He said that there was $150 million in deferred maintenance of sidewalks. He said a possible revenue source may be a parking tax (on parking spaces or parking lots) – he said Atlanta has extremely low parking rates for a city its size. That tax might generate $50 million a year. In response to a follow-up question about a few homeowners who are blocking badly needed sidewalks, Aaron said it was hard to force them to do much in the absence of a city sidewalk policy. John Schaffner pointed out that there seemed to be a lot more emphasis in the city on providing bike lanes than sidewalks even though there are a lot more walkers than there are bikers. How is a balance going to be achieved? Aaron said the city has clear responsibility for the roads, which is where bike lanes are placed; the city doesn’t have responsibility for the sidewalks. He expects an increase in the “alternative transportation network” in the upcoming years. Aaron said that the city would need added revenues to take on responsibility for sidewalks.
A questioner said there are more impervious surfaces being constructed and asked what’s the city doing about the resulting stormwater problems? Aaron said this is a city responsibility and is spending a lot of money (from sewer fees on water bills). He said they are starting to balance out priorities between sewer work and other work. With the extension of the sewer consent decree, the city now has the opportunity to reallocate funding to other watershed issues.
Compensation for police court time – Gordon Certain asked about unfair pay policies for police spending time in court. He quoted Major Hobbs as saying that an officer is paid $25 for his presence in court whether the case comes up first or if the officer has to sit in court all day long. A lot of officers simply don’t appear. Aaron said that is something they are working on in the current budget. He said they “are losing money because the officers don’t stay to make the
case”. He said they are looking at lot of potential solutions and something will likely be achieved in this budget because it is revenue-neutral.
Pension and medical benefits
Glenn Delk asked if the city was still premising their pension fund decisions assuming an (unrealistic) 8% return. Aaron said they had reduced that assumption somewhat but that they are still being told by their actuaries that the right number is still around 7.25% over a thirty year range. What is being considered to reduce the medical cost exposure? Aaron said actions involving current retirees are “mostly off the table”. He said most of the focus will be on people who haven’t retired yet. He said spousal and family coverage will probably not be free in the future. He said some police benefits are remarkable but were intended to be remarkable. He said the police retain coverage when they go work somewhere else. Aaron plans to send Gordon a report
of possible actions that might be taken. He said efforts are increasing their efforts to manage medical costs (steering employees to lower cost providers, etc.). He said the city uses insurers (Blue Cross/Blue Shield) to manage the system but the city is self-insured for the cost of the medical benefits program. Further, retired APD policemen to not take Medicare – they stay on Atlanta taxpayer financed medical insurance.
Do we get rent from the airport? Aaron said by Federal law that the airport must be a self-sufficient enterprise. He said the airport has about $1 billion in the bank. He said it is probably the best run airport in the world. He said the city’s overhead involving the management of the airport is reimbursed. He thinks the city is getting immense benefits from the airport and the way it operates is not bad for the city.
Dan Whisenhunt asked what authority the City Council has over traffic court operations. Aaron: A lot. Dan said he had to spend a lot of time for something that could have been better handled on-line. Aaron said to contact him or others on the Council or the mayor with court complaints. He said that the city is currently making technology investments to bring the situation “into the modern world”.
Jim King pointed out that the city has never built a swimming pool on the Northside – the Garden Hills pool was privately financed and the Chastain pool was inherited from Fulton when the area was annexed by Atlanta. Yet seven pools have been built in other parts of the city. Our area is told to find its own funding. We maintain many of our parks. Aaron said our revenues are down $100 million and new expenditures aren’t possible. Plus, the MLK pool is
closed. As revenues improve there will be money for the bond issue which will include money for sidewalks. There was also discussion of the Vulcan Bellwood Quarry – Aaron said it will become the city’s largest park. Attention right now is on how to tie the reservoir into the city’s water system which he described as an enormous engineering challenge.
V. Briefing on Common Cause Initiative by William Perry, Executive Director
William Perry is Executive Director of Common Cause Georgia. He can be contacted at 404-524-4598 or email@example.com. He requested time to let BCN know about the initiative his organization has undertaken. William said their initiative involves trying to put public funding of the proposed new stadium on the ballot so citizens can vote on the issue. He said their objective is to let the public have full input on the issue. Initially, when the state was involved in the stadium, Common Cause pushed to get City Council representatives and other local officials and public representatives involved in the decision making. He said the state refused. He said they then hoped the Legislature would have public committee hearings with the opportunity for public input, but the legislature decided to not get involved, deciding to hand the issue to the Atlanta City Council. He said they had hoped there would be full vetting of the plan in public committee meetings with the public able to weigh in. “But the Atlanta City Council took an amazing step, unprecedented, and that instead of making that funding plan an ordinance, they made it a resolution. And the big difference there is that a resolution can be read and adopted in one Council meeting, whereas an ordinance has to be read at one Council meeting, go to the committee process and then come back to the Council. So that would have been several weeks where the public would have the opportunity to absorb the plan and really look at it. At that point, we did ask the Council to consider to vote to put it on the ballot so the public could vote on it and they chose not to do that. So we kind of feel like we gave them to opportunity to do that so now we are going to try to give you the opportunity to do that,” He said the City Charter allows a citizen-initiated referendum process, something that has never been attempted. He said it is by design a very difficult task: 35,000 signatures by registered voters must be collected within 60 days. They have geared up to do that. They are seeking the opportunity for the public to have a say; they are not seeking an outcome for or against the stadium. He said the public really hasn’t a true opportunity to weigh in on this issue and “we learned a lot about what the plan said after it had passed”. He said the Falcons had admitted they had
been bluffing about leaving Atlanta or Georgia. He continued, “we truly believe the stadium is going to happen, with or without the public funding – there’s too much of an investment on the Falcon’s end.” “There hasn’t been a full economic impact study so it’s hard to say what a new stadium will do. If you
look across the country where new stadiums have been built, and a lot of the studies that have been done there, don’t show that there’s a true increase in economic impact when you take one facility and replace it with another. It’s a totally different story if you don’t have a professional team and you don’t
have that sort of facility already in your [area]. But the economic impact study that was given to us already shows the impact of the SEC Championship, which I would contend we’ll never lose. It shows we occasionally get the Final Four and the Super Bowl and these other things, which I think we would continue to get with the Georgia Dome. But the most important piece of it for us is the public transparency and the public participation.” He passed out their flyer about the task they are taking on. Referring to the flyer, William said “the flip side shows you the funding and the numbers that we have come across, not because it has been readily publicly available but it is because it is the information we have gotten out of open record requests and things like that. Because I think the biggest myth about this is the Falcons are paying $800 million for this $1 billion stadium and the public is paying $200 million. The public is funding a portion of the construction to the tune of $200 million, but the current state law requires that 40% of the hotel/motel tax over the next thirty years to go to the successor facility no matter what. And there are several waterfall accounts that money will flow into. So if you get the bonds paid off, then there’s an operating and maintenance account. Beyond that, there’s a capital improvement account. Beyond that, there’s an event staging account, which basically means those hotel/motel tax dollars could go towards helping pay for the SEC Championship while the profits from that event, which now go to the state, under the new deal go to Arthur Blank and the Falcons. All the concessions currently generated at the Georgia Dome go to the state, as does the parking; under the
new plan, all of that revenue goes to the Falcons. The only benefit to the state under the new plan is about $2½ million per year paid in rent, whereas now they average $4 to about $6½ million in revenue to the state for the Georgia Dome. So it is a completely different plan, and I think one that we lose out
on. But the bottom line at the end of the day we think it is one that should be decided by the people of Atlanta as it often is in other states.” He emphasized that nothing the state or City Council did is illegal and that they didn’t violate any rules. Every other city with a new stadium got to vote on financing their
stadiums (except New York, whose stadium was privately financed). He said that the city and state disagree on the amount of tax financing for the stadium. On that basis, he interprets the public funding to be either $½ billion or $1 billion. Either far it is far in excess of a $200 million public investment. He
asked for any and all help in securing signatures. He emphasized that the name and signature on the petition must exactly match the name as recorded in the voter registration system. City of Atlanta registered voters who would like to sign the petition should contact William Perry at firstname.lastname@example.org or 404-524-4598. It is not possible to complete the petition on-line. Aaron Watson responded, “I do want to say just a little bit about why it was an easy question for most
of on Council to support that matter and why it was so easily done. Everybody who understands what the financing mechanism was and what we did, most people understand it come to understand why we did what we did. And many people who don’t have an almost intuitive opposition to spending public
money if they think it is really public money on a stadium, as do most people on Council, by the way. But the simple question for us was, of this $200 million that that the state allows us to collect from visitors in our hotel rooms, were we willing to have that money which is required to be spent on a facility
like this, were we willing to continue to …it is currently spent on a facility like that … were we willing to allow it to continue to be spent in connection with this funding. And that was a relative no-brainer for us when it had nothing to do with anybody’s threats to move a team. That had nothing to do with the
conversation. I never heard it. But it had all to do with whether or not we wanted this billion and a half, billion, whatever, largely privately financed development with all the risk of cost overruns being assumed on the private side, were we going to allow this $200 million stream, which we could not use
for any other purpose per state law, to continue to be used the way it was. And so, for most of us, that was a pretty simple question. It had nothing to do with many of the things that my friend there has brought up.” Glenn Delk interrupted Aaron’s next sentence, asking if William had been correct in saying that the public investment number is actually closer to a half a billion or a billion? The back and forth between Aaron and Glenn didn’t result in complete sentences and ultimately focused on whether the hotel/motel money had to be spent on this stadium or a stadium of this sort. Aaron said the money had to go to a stadium and could go to a different stadium project. Glenn wanted to know why the city couldn’t get the money and use it for another purpose. Aaron said the only way to repurpose the money was to have the State Legislature vote to do so. He said the state law could be changed, but that nobody introduced legislation to do so. Glenn asked what Aaron’s position was on allowing the public to vote, noting that if the public opposed the stadium, the Legislature might react by changing the law. Aaron said he didn’t have a position on that issue – he said he is in favor of democracy but insisted that “this issue is settled, for now”, though it might end up in litigation later. In response to a question, William said “the state law does read that all of that money does have to go over the next thirty years to a successor facility for the Dome; it can’t be used for anything else under the current law. But if the Atlanta City Council or the citizens of Atlanta rejected that, and if the City Council put in their legislative package next year ‘we would like to use this funding for infrastructure improvements’, or any of the things you all have talked about tonight that for some reason stadium funding has received a higher priority, then the Legislature would be forced to change that and I think would respond to the overwhelming will of the people of the city.” Aaron responded, “What they would do is, they would roll off the tax and no one would get the money. That’s what would happen.” He indicated the state’s track record in supporting city needs was poor, as shown by no support for MARTA. John Schaffner suggested that the city’s efforts to purchase Morris Brown University property for $9.2 million might actually be for rerouting MLK Boulevard to accommodate the preferred site of the stadium. He asked Aaron if that wasn’t city taxpayer money going to fund the stadium project. Aaron said it wasn’t for the rerouting of the road but an effort by Invest Atlanta to use TAD money to acquire parts of that campus given there would be a lot of development opportunities around the stadium and that possibly part of that land might be used for replacement property for one of the churches possibly being displaced by the stadium (through possible purchase by the Blank foundation). [Aaron, who had stayed later than planned, left the meeting at this point.] In response to questions from Jim King about the money basically being a state issue, William disagreed, saying that while the tax is largely paid by tourists, the money is Atlanta tax revenue. It can be used of other things beneficial to the city’s residents. He indicated that there are 23 categories that
are permitted bylaw to use hotel/motel tax revenues. A stadium is just one possibility. It could be used to help pay our water bills or our infrastructure. William said the $200 million is the amount of bonds the city is putting up to fund stadium construction which will involve $418 million of hotel/motel tax payments. Tom Gordon responded that he thought it was unreasonable to focus so much on the bond payments instead of the principal when every other bond and mortgage discussion focusses on the principal amount and not the payments. Glenn Delk asked, “Are you saying that the amount of revenue that’s going to be generated by the hotel/motel tax is going to pay the face amount of bonds, plus the interest on the bonds and then generate an extra $300 or $400 million on top of that?” William: “Yes, that will be used for operation and maintenance of the Dome, capital improvements…” Glenn: “And that’s the part that the Legislature could change.” Jim asked, “Can they change it retroactively?” William answered, “Until the public bonds are financed, everything remains on the table, because just like you don’t get your house until you close the deal. … And the process won’t even start until mid-summer and won’t close until next summer. When they say ‘too late, sorry’, hat hasn’t happened.” Glenn said, “To be clear to folks, I think you should have a chart that spells out the hotel/motel tax is going to go on for however many years and here’s where the money is going to go. In essence, what the city is giving up is $300 or $400 million on the back end. … If you explain it that way, I don’t think people will have the kind of confusion we’re having.” Glenn wondered how much this deal is going to add to the Falcon’s annual cash flow, since the state is going from getting $6 million down to $2.5 million, and additional revenue from concessions, parking, the seat licenses, and “all that”. He said that should be pretty easy to calculate. William added, “It is important to point out that that’s not just on the football games, it is every event in the stadium.” Glenn: “They control everything?” William: “Every convention in the stadium, every monster truck pull, every rodeo. The Falcons get the revenue from everything. And one of the waterfalls the hotel/motel tax falls into is helping to put on those events.” Glenn: “Why would the city put up an arrangement with the state that we’re going to put up all the cost and all the revenue is going to go to the Falcons? … They don’t currently get revenue from those events, do they?” William: “No.” Glenn: “So what’s the rationale for changing that?” William said the deal has been signed by the mayor and the only way to stop it is by blocking the funding of the bonds. A referendum would do that or potentially litigation.
VI. Committee and Liaison Updates
- No report.
- Tom Tidwell said they will hire enough teachers under the new budget to retain the current class size. He added the potential sale of the AIS site was now on the “back burner”. Glenn Delk thought the decision on the Atlanta Classical charter would be deferred until July or August. He said that Rickard Belcher was going to do a story about Atlanta leading in one education category – we will have the most expensive high school ever built in the state. The total cost including and is $146 million.
- Did not meet. No report.
- No Report.
- No Report.
- No Report.
- No Report.
- No Report
Transportation, Development and Infrastructure
- Jim King and Gordon Certain commented on the Sandy Springs Gateway project—the approval vote will be deferred at the July City Council meeting.
VII. Old / New Business
Bylaws Change Email Voting By the end of this board meeting, sufficient ballots had been submitted to approve this bylaws change. A report will be made at the July meeting.
XIII. Community Concerns – No Report.
IX. Announcements – None.
X. Next Meeting – July 11, 2013
XI. Adjourn – The meeting adjourned at about 8:15 PM.
Note: The opinions expressed by the speakers and individual neighborhood representatives in these minutes do not necessarily represent those of BCN or its member neighborhoods.