How do you “reshape” an organization that stimulates economic development in Fulton County in a variety of ways including providing tax incentives that some community members so vocally oppose? Restructuring, retooling and telling people their story is exactly how the board of the Development Authority of Fulton County (DAFC) plans to continue to move the organization forward.
The DAFC provides tax incentives to development projects in the form of a reduction in property taxes for a limited period of time. This process was created in 1973 by the Georgia State legislature and approved by the Fulton County Board of Commissioners. Since that time, the DAFC has completed more than $25 billion in transactions and has stimulated economic development in Fulton County by expanding and diversifying the tax base, creating jobs, retaining existing business and sustaining quality of life for residents throughout the County.
The DAFC encourages development that otherwise would be in jeopardy of coming to fruition or developed in a manner that is less beneficial to the community without support in the form of tax incentives. The DAFC assists developers with their projects when 1) the developer needs financial assistance to complete the project and 2) the project will benefit Fulton County with the creation of new jobs, increased tax revenue and increased trade and commerce and 3) substantially enhances the lives of the residents in the community in which it is built.
“We are laser focused on uplifting communities,” Kyle Lamont, Chair of the DAFC Strategic Initiatives Committee said. “This means determining how developers that come before us are benefiting under-served areas of Fulton County like areas south of I-20. We must ensure that projects that we approve for an incentive, directly respond to specific community needs and are supported by the local neighborhoods.”
The DAFC currently provides this assistance in the form of a 10-year property tax incentive starting with a reduction of 50% of the property taxes based on the assessed value of the property. Beginning when a developer finishes construction and receives a Certificate of Occupancy, then, every year for 10 years the 50% tax reduction is reduced by 5% (50, 45, 40, 35, 30, 25, 20, 15, 10, 5).
In year 10, the developer will receive only a discount of 5% on their property taxes. In year 11 and onward, the developer pays standard property tax amounts and the property tax collected by the county will be 100% of the amount owed. The law allows this property tax benefit based on the theory that after the construction of the new project, the property tax bill will increase, thus increasing the amount of taxes collected by Fulton county.
The million dollar question, literally, is how should the DAFC Board determine which projects deserve an incentive and which do not? In other words, which developments are valuable enough to Fulton County such that the project should be allowed to pay less in property taxes, in the short term, in order to ensure the development actually happens.
The board must weigh the county’s competing interests. Careful and thoughtful legal and factual analysis takes place to assess how much Fulton County benefits from the construction of the project or how much Fulton County loses without the construction of the project. The board engages in the challenging task of weighing both tangible and intangible benefits when evaluating projects.
The DAFC utilizes an economic development impact model designed and certified by Ernst & Young in its analysis. This model calculates the economic impact of a project and applies certain DAFC threshold requirements.
History shows that development has occurred at a faster rate on the north side of Fulton County compared to the south. This difference in the amount and speed of development has contributed to inequities between north and south Fulton County. For instance, all but 2 North Fulton cities have median household incomes above the county average of $69,673, while none of the cities to the south have median incomes that equal or exceed Fulton County’s overall median. This income disparity directly impacts the economic development work of the DAFC.
The Board is seeking to address these inequities and unlock potential and opportunities throughout southern Fulton County. The economic imbalance in Fulton County contributes to the complexities of the work of the DAFC board. They are attempting to appropriately support economic development in “hot” markets of the county while simultaneously taking serious action to help under-served areas, specifically south of I-20 that have for too long been left behind.
“Because we are very aware of the lack of development in certain under-served areas of the county,” DAFC Board Chairman Michel “Marty” Turpeau said. “We must do something about it. This doesn’t mean we neglect any area, but we must pay special attention to developing tools that target under-served areas.”
Sarah-Elizabeth Langford was hired in September 2021 as the Interim Executive Director and says she is focused on determining how the DAFC can continue doing work that benefits all of Fulton County.
“This involves a combination of understanding board priorities and also aggressively pursuing opportunities to advance all of Fulton County,” Langford said. “There is so much positive growth going on throughout the county, it’s imperative that the DAFC remains a strong partner adding value as a catalyst for high quality development.”
In addition, the DAFC is to be the only Development Authority that has formalized participation goals to help further open the doors to minority and women owned businesses. Chairman Turpeau is the author of the Minority and Female Business Enterprise (MFBE) policy and he recently appointed Atlanta Public School’s Senior Advisor, Erica Long to chair the MFBE Committee.
“Our policy will ensure we are doing our part in helping create systems and procedures that encourage a diverse pool of qualified partners on every project that comes before the board,” Long said.
The Board also authorized the development of a new DAFC website which was completed and revealed this month and demonstrates the Board’s commitment to advancing the organization in progressive and intentional ways.
These are some of the many issues and initiatives that the DAFC board members tackle as they work to benefit all residents of Fulton County through responsible and equitable economic development.