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Flowery Branch votes to buy parcel in TAD deal

Commissioner Lutz objects to plan to spend $225K to develop site

POSTED: December 7, 2012 12:47 a.m.

Flowery Branch City Council members Thursday approved acquisition of a combined 2.72-acre land parcel in a move questioned by a current Hall County commissioner and former council member.

The properties, located at 5318 Railroad Ave. and 5404 Church St., have been considered for purchase through tax allocation district funds created and administered through an intergovernmental agreement with Hall County.

The TAD financing amount is not to exceed $225,000, as unanimously approved Nov. 13 by an advisory council made of city and county representatives.

Flowery Branch officials expressed interest in the property after it underwent bank reappraisal.

City leaders were drawn to the purchase out of concerns that piecemeal acquisition by land speculators would ensue, and any development would be contrary to the city’s existing Old Town and commercial redevelopment plan created in 2007.

In 2008, Flowery Branch and Hall County agreed to include certain county ad valorem taxes in computing taxes allocated for the Flowery Branch TAD. The agreement is binding, with periodic review periods. The review period began in January and is not up for consideration again until January 2015.

TAD funding is available under the Redevelopment Powers Law to be used for property assembly and acquisition, construction, infrastructure and transportation improvements, as well as administrative costs including plans and studies.

Hall Commissioner Craig Lutz, a former Flowery Branch councilman, expressed concern about the acquisition in emails obtained by The Times under an open records request.

Without naming the city, Lutz wrote: “In the case of the investment I have called you about, the city plans to purchase property, which will decrease the tax revenue by excluding it from the tax digest.”

The amount over which Lutz expressed concerns totals $2,641. The accurate total, according to figures by provided by Flowery Branch administrators, is $2,942.94, with an impact of approximately .0016 of 1 percent of the property tax budget, or $880 to the Hall County tax base.

In comparison, the tax digest impact from the purchase of the former Liberty Mutual building for use as the Hall County Government Center is approximately $17,900, Flowery Branch city planner James Riker said.

After including the digest impact on Gainesville’s city school and municipal taxes lost, the figure climbs to roughly $91,400.

Lutz approached the council during Thursday’s meeting, reiterating his concerns.

“A consensus of the commissioners ... feel that some of these items (including the acquisition) do not fit with these funds,” Lutz said. “I’m requesting that we table this item to work out a plan to use the funds in a more appropriate manner.”

Lutz attended the meeting alone and did not specify which commissioners were part of such a consensus. He left before the vote occurred.

Responding in an email, county Administrator Randy Knighton wrote, “If the county has intentions of withdrawing from the TAD, notice would have to be given as specified in (the agreement). ... If a consensus of commissioners intend to terminate the agreement, signed in 2008, a resolution expressing intent would be necessary within 90 days of the end of the applicable three-year period.”

Mayor Mike Miller asked city attorney Ron Bennett whether it would be illegal, and grounds for court action, if the county withdrew from the TAD agreement before the agreed-upon time constraints.

“It is, in my opinion,” Bennett said.

Miller responded: “If they do, I will be in the courthouse, with you, filing this document.”

Regarding Lutz’s commentary on the city’s proposition for Flowery Branch growth and development, Miller said, “I think it’s sad that our citizens are represented like that.”

When reached for comment, Commissioner Scott Gibbs said he does not object to using TAD funds “if it within their legal parameters,” but said he does not agree with funds used on administrative investments such as city offices, buildings or items such as green spaces.

Commissioner Billy Powell concurred with Gibbs. “As long as it is in compliance with the TAD Redevelopment Act, I have no problem,” he said.

Commission Chairman Tom Oliver agreed as well.

“I feel the same. I’ve already voted for this once, and I stand by my vote,” he said.

Flowery Branch officials have publicly stated that any purchases and property revitalization would be in anticipation of private investment. City officials have been in discussions with property developers who see the acquisition as potentially lucrative in the private market.

Earlier Thursday, an additional meeting was held concerning private investment and development potential with a firm whose projects are considered prominent in metro Atlanta. Council members also stated that private investment is their best option for increasing the city tax base and, ultimately, fortifying TAD investment returns.

Councilman Joe Anglin noted that Flowery Branch has always provided annual analysis of its TAD utilization, as well as receiving unanimous approval by the two county members on the advisement committee.

“We look at this as an opportunity,” Anglin said, “to better position ourselves to work ... to put together a nice piece in Flowery Branch.

“You need to be proactive, take action.”

Lutz’s final point concerned the timing of TAD fund usage, referencing an end-of-year deadline for capitalizing on remaining available funds.

“The fact that we’re doing this work in December is serendipitous,” said City Manager Bill Andrew, continuing that pursuit of the property has been in motion since early spring.

Council members agreed.

“It has nothing to do with this deadline,” Andrew said. “We (Flowery Branch and United Community Bank) could not earlier arrive at an acceptable price point. They came back to us, in the fall, and we were able to add that to the financing of the demolition of the Mooney building.”

Noting informal discussions with two county officials, both Bennett and Andrew said they were told the city’s intended actions “were well within the county agreement and state laws.”

The Railroad and Church Street properties were originally part of the approved development group Hortman & Dobbs’ “Old Town Flowery Branch” project. The project was never initiated due to faltering economic conditions, and United Community Bank foreclosed on the property.

Additional council resolutions approved include TAD financing appropriations for the demolition and asbestos abatement for the former Mooney Manufacturing site at 5702 Main St. The plant, bought by the city in 2010, has been deemed obsolete.

Council approved as much as $152,000 for renovation of the site to greenfield state, readying it for private investment. A greenfield is a parcel cleared of debris and deemed safe for development.

The city approved TAD financing not to exceed $95,000 for the preparation of an updated master redevelopment plan within certain areas of the Flowery Branch Old Town and Commercial Gateways areas.


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