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Millions in tax breaks given to redevelop old GM site

Tax money will finance public infrastructure on the site, despite DeKalb school system’s objections


Doraville city leaders forged ahead with a plan that allows for the redevelopment of the vacant General Motors site, approving a complex tax incentives arrangement that doesn’t require the consent of a reluctant DeKalb County school system.

After the site’s owners couldn’t convince the school board to throw its support behind their project, the Doraville Downtown Development Authority voted unanimously Tuesday night to award incentives worth 35 percent of the site’s annual property tax bill for the next 30 years.

The amount of the tax breaks could exceed $82 million if developers succeed in their effort to increase the property’s value to more than $1.5 billion over the next three decades, according to calculations by The Atlanta Journal-Constitution.

Doraville leaders initially wanted to help finance the project through a tax allocation district, which would have preserved the site’s existing tax base and dedicated future increases in tax revenue on infrastructure improvements. But school system officials, whose approval is required, have said they’re reluctant to commit educational resources to a business prospect.

The tax breaks approved Tuesday cut into both the school system’s current and future tax revenue. Development authorities throughout Georgia have the power to grant property tax abatements for business growth.

“The DeKalb County Board of Education and I remain concerned with any efforts to divert critical funding of the education of our students,” said DeKalb schools Superintendent Steve Green in a statement. “The combination of not having sufficient evidence and having a minority role in the decision making is unacceptable.”

Developers want to turn the 165-acre General Motors site into a mixture of offices, housing, film studios and retail.

Money saved because of the incentives could be used to build a $60 million tunnel and street to the existing Doraville MARTA station, which is currently walled off from the site. The property’s developer, Integral Group, says the connection to MARTA is essential to attracting businesses to the vast, barren site.

“There’s a significant amount of up-front investment that has to be made purely for the benefit of public,” said Dave Schmit, a real estate developer working on the project. “We think the No. 1 item we want to do is connect the MARTA station to the site.”

“It will define Doraville, for here and forever,” Schmit said of the redevelopment.

For eight years since the GM plant closed, the site has been dormant. Developers said they couldn’t wait any longer to get started on the project. Already, businesses that could have brought 1,200 jobs to the site have passed on the opportunity because of uncertainty and delays, Schmit said.

“This is such an important project. We don’t want it to go by the wayside,” said Doraville Mayor Donna Pittman.

The connection to MARTA is as important for the Doraville project, known as Assembly, as construction of the 17th Street bridge was for Atlantic Station in Midtown, Schmit said. Without access to transportation options, businesses will locate elsewhere.

In addition to the MARTA concourse, the tax breaks could also fund other infrastructure including streets, water lines and sewer lines.

“This is really a historic undertaking,” said Jack Halpern, chairman of the Doraville Downtown Development Authority. “It’s one of the largest tracts of its kind in the southeastern United States. With the access to transit, surface streets and interstate access, it will be attractive to a large variety of users.”

The Assembly development will create up to 8,000 new jobs, generate $2 billion in private investment, add 4,000 residential units and increase daily MARTA ridership by 30,000 to 45,000, according to developers.

But Tom Hart, a former city councilman, said the tax incentives are a handout that will take money from the school system, DeKalb County’s government and the city government.

“It’s going to suck all the oxygen out of the air of this city,” Hart said. “They’re giving all that energy and money to the developer. Why are we involved with this deal?”

Supporters of the development are still hoping the school system and county government will agree to the tax allocation district, which would generate additional money for site improvement. Developers will attempt to leverage the tax breaks that were approved Tuesday to sell bonds that would raise money up-front for the infrastructure.

The site’s property owners have formed an organization called a community improvement district, which will be used to spend money generated from the tax breaks specifically for public infrastructure.

“This is a watershed moment in getting this project done, but this is just one step,” said Luke Howe, the city’s economic development director. “It’s much more complicated than it had to be, but we’re going to get there.”

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