RATIONALE/OBJECTIVE:

To be developed

RULE:

The Georgia Redevelopment Powers Law, O.C.G.A. § 36-44-1, et seq., provides means for the redevelopment of economically and socially depressed areas through the creation of tax allocation districts by political subdivisions. O.C.G.A. § 36-44-8. The creation of a tax allocation district (TAD) permits the use of actual or anticipated increase in ad valorem tax revenues resulting from redevelopment activities to fund activities in furtherance of that redevelopment. Implicit in this financing method (which involves a commitment of public resources to what are generally private endeavors) is the expectation that but for the infusion of the public commitment, the increased property tax revenue would not occur.

Typically, a large proportion of the total tax millage rate for a county is levied for county school district purposes. Section 36-44-9(c) of the Redevelopment Powers Law provides that the school district component of tax revenue can be included in the computation of tax allocation increments if the board of education consents to such inclusion by resolution duly adopted by the board. However, Article 8, Section 6, Paragraph I(b), of the Georgia Constitution provides that:

(b) School tax funds shall be expended only for the support and maintenance of public schools, public vocational-technical schools, public education, and activities necessary or incidental thereto, including school lunch purposes.

The Cobb County Board of Education regards this constitutional provision as the creation of a fiduciary obligation of the highest order to ensure that the school district component of ad valorem property tax levies is used in a manner that is clearly and convincingly beneficial to the school district and its students. This Statement of Policy is intended to permit the Cobb County School District to support appropriate redevelopment under the Redevelopment Powers Law without detriment to the constitutional mission of education.

A. General Policy.

1. It is the policy of the Cobb County Board Of Education to carefully and fully consider all applications for creation of a tax allocation district requiring consent of the Board under O.C.G.A. § 36-44-9(c).

2. The Cobb County Board Of Education shall not consent to the creation of a tax allocation district unless, following careful review of the application, the evidence is clear and convincing that:

(a) the redevelopment activities described in the redevelopment plan will occur, and

(b) but for the use of TAD financing, the redevelopment activity and tax increment would not occur, and

(c) the redevelopment activities will provide benefits to the Cobb County School District commensurate with the dedication of the school district component of the tax increment ("school district benefit").

3. "School district benefit" shall mean additional revenues resulting from a TAD that would otherwise be received by the School District (with or without regard to the existence of the TAD) are ultimately received or restored to the School District within a time and under terms and conditions set forth in the consent document s or, if not, such other benefits as would warrant any deferral or adjustment of receipt of increased tax revenues resulting from the TAD.

4. The Cobb County Board of Education will look with significantly greater favor upon applications for consent that involve specific projects, defined as projects with detailed descriptions, including information as to: the identity of the project redevelopment participants, the affected real property, the property improvements, redevelopment costs, the method of financing, the nature and status of participation and financing commitments, and such other information as may be required by the Board.

5. Applications that do not involve specific projects as described above shall not be approved unless the following criteria are clearly satisfied:

the characteristics of the proposed district are such that the proposed described redevelopment offers unique opportunities for assured substantial increases in the assessed value of the proposed TAD; and

financial projections are detailed and supported by documented information, reliable models, and analysis from sources with recognized expertise; and

there are identified special benefits, direct or indirect, for the school district beyond those projected as resulting solely from the increase in assessed value of the property in the TAD; and

there are sound reasons why designation of a TAD and Board consent cannot await the creation of specific projects; and

the projected time frames for milestones for the redevelopment are of such length and sufficiently credible as to minimize risk to school district interests; and

there are safeguards in place to assure the opportunity for Board scrutiny and involvement in decisions as the redevelopment occurs, including, at a minimum, the opportunity to approve specific projects; and

there are safeguards to protect the use of the Board share of accumulated tax increments pending use for redevelopment costs.

B. Policy and Procedure

1. The Cobb County Board of Education adopts and incorporates the TAD Policy and Guidelines adopted by the Cobb County Board of Commissioners on or about April 22, 2003, as revised on May 11, 2004, to the extent applicable, except as provided herein.

2. Applicants seeking consent of the Cobb County Board of Education to a TAD shall provide the School District with two copies of all materials submitted to the Cobb County government (including the required Redevelopment Plan) at the time of that submission.

3. In addition, applicants shall submit a completed Application for School Board Consent to a Tax Allocation District in a form prescribed by the School District and provide such other information required by the District.

4. Applications for School Board consent shall be submitted no later than August 1 of the year prior to the year in which the proposed TAD is to take effect. This requirement may be waived by the Board for good cause shown.

5. In order to mitigate the costs of processing the application, applications shall be accompanied by a nonrefundable fee of $7,500.00 in the form of a check made out to Cobb County Board of Education. All successful applicants will be responsible for prompt payment of all out-of-pocket expenses that the School Board may incur in connection with the creation of the TAD (in excess of any expenses paid by the School Board from the Application Fee) or thereafter related directly to the TAD, including, without limitation, fees and expenses of the any financial advisor and legal counsel employed by the Board.

6. Any conditions to Board consent to a TAD shall be included in a binding intergovernmental agreement or other contract containing terms sufficient to carry out these policies.

Adopted: 6/24/04
Reclassified an Administrative Rule: 9/1/04