DeKalb County’s Development Authority, known as Decide DeKalb, is considering a $15 million tax break for a Brookhaven development, reigniting conversations about who gets a say in how tax incentives are dolled out.
On March 24, DeKalb County Commissioner Jeff Rader issued an emailed statement calling for residents to speak out against a proposed tax break for Manor Druid Hills, a mixed-use development at the intersection of Briarcliff and North Druid Hills roads. The development site is located in a flourishing residential and medical district, and adjacent to a future Children’s Healthcare of Atlanta campus with a $1 billion new hospital and other facilities.
The Brookhaven City Council annexed the 26 acres the development sits on in October 2020. The development would include 300 apartments, 55,000 square feet of office and retail space, and a 140-room hotel.
The project was supposed to go before the Decide DeKalb Development Authority — a quasi-governmental body that provides tax breaks for property developments — on March 25, but the meeting was cancelled. The meeting has not yet been rescheduled.
In his email, Rader said tax abatements in the county are under scrutiny for being an “attack” on the county school system and a “threat to taxable businesses who compete with those awarded these gratuities.”
Property taxes make up a significant portion of funding for the DeKalb County School District, which does not have a say when it comes to how development authorities handle tax breaks. State Rep. Mary Margaret Oliver (D-Decatur) recently introduced legislation that would allow for local school districts to have more say in the abatement process.
“School systems need to have legal standing in court to state their positions in bond validation hearings,” Oliver said in an email. “HB 66 needs to pass. This is a statewide issue the General Assembly needs to address.”
Oliver said development authorities have opposed the bill, which will be held over until the 2022 legislative session. However, she said there will be a serious effort to have discussions surrounding the bill this summer.
“It’s not only a DeKalb issue. This is an issue across the state,” she said. “I’m talking to many different members who have development authorities who are not being good neighbors to the school systems and other local governments. This issue is heating up and I look forward to a good discussion in the summer.”
Development authorities, which can exist at the county or city level, have gotten into hot water with DeKalb County and the DeKalb County School District before. Last year, the Brookhaven Development Authority approved a tax break worth up to $13.5 million over a 22-year period for a mixed-used development on a 4-acre lot on Dresden Drive. The county and the school district filed motions to intervene in DeKalb County Superior Court, arguing they could because the tax break would affect their revenue streams. The developer, Connolly Investment & Development, ended up withdrawing the proposal.
Developers can ask for tax abatements from city and county development authorities at the same time. A spokesperson for the city of Brookhaven said the city has not received a request from the developer for this project.
Rader said tax dollars would be necessary to plan for the “developmental pressures” associated with the booming medical district where the Manor Druid Hills development would be located.
“We need tax revenues and time to build the infrastructure to serve all this new activity,” he said. With tax abatement this project will bring accelerated new traffic and service demand we can’t meet … Projects serving the subsidized hospital district can yield the necessary funds, but only if they are taxed.”
Don Bolia, chair of the Decide DeKalb Development Authority, said in an emailed statement that the idea that tax breaks take away from city, school or county funds is “a mischaracterization,” and that the development includes medical office space for CHOA’s campus, and hotel and residential space for medical professionals, patients and their families.
“Manor Druid Hills is projected to increase the tax digest while advancing a critical need for affordable housing, bringing an estimated 270 new jobs to our communities, and generating property tax revenues of $42.6 million over 20 years,” Bolia said. “That new tax revenue could help fund teachers’ salaries, technology in our public schools, and infrastructure improvements across the county.”
Bolia said the authority has a mandated 20% affordable housing requirement in its incentives package. In his email, Rader said the number of workforce housing units would not justify a $15 million abatement.
“The 38 workforce housing units used to justify a $15 million abatement would cost only $1.4 million to provide,” he said. “We need and will build affordable housing here, but this is an extraordinarily wasteful way to provide very little.”