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Statement from the Office of Mayor Kasim Reed on AJC's PolitiFact Ruling

8/20/2013, 4:31 p.m.
Mayor Kasim Reed

2004 Op. Att’y Gen. 04-3 describes the analysis of whether a particular activity violates the gratuities clause as follows: “… it is fair to say that the cited precedent and other reported cases and opinions require a good faith expectation, and primary motive, that the state will benefit in fair return for the cost or the value bestowed and further that the actual gratuitous activity and the function expected to benefit indirectly are expressly authorized by law, or are authorized by implication.”

2004 Op. Att’y Gen. 04-3, p. 3…. “Thus, for a transaction in which the State buys real property or any other asset, an analysis has to be undertaken of whether the State is receiving a benefit in fair return for the cost and value bestowed upon the party selling the real property or other asset to the State. Obviously, the direct way to measure that fair return is to determine the fair market value of the property.”

Full Statement from Georgia Attorney General Sam Olens:

While I read with interest PolitiFact columns, and commend the paper for this endeavor, today’s PolitiFact, “Spending limit a best practice, not a state law,” is incorrect and misleading.

The end of today’s column reads: “Reed’s statement is based on an interpretation of a portion of the Georgia Constitution, purportedly long-held best practices, and an attorney general’s opinion on property leases that’s almost two decades old…And our research found no laws establishing this limit.”

The Georgia Constitution is the supreme law of our state. It is the law. Our office’s Opinions interpreting the Constitution remain valid until withdrawn or the law is changed, regardless of the number of years since they were written.

The Gratuities Clause of the Georgia Constitution is a vital safeguard of the State’s taxpayers. It ensures that tax dollars won’t be just given away based on favoritism or political connections; instead, tax dollars can only be spent when the State gets full value for those dollars.

My office has interpreted this Clause for decades as limiting the State to paying fair market value for property, absent some additional source of value that the State receives from the transaction.

Mayor Reed’s comment was correct, and accurately reflects the legal limitations under which the State is acting in this matter.