An effort by members of Atlanta City Council to get an audit of the $5 billion Gulch development proposal failed Monday to win the eight council votes needed to pass.
The failure to approve the outside review could keep the project on track for a council vote at its next meeting Oct. 15. Last month, Mayor Keisha Lance Bottoms delayed a vote on the Gulch deal because of a lack of council support.
Developer CIM Group has proposed a mini-city of offices, hotels, apartments and retail between the Five Points MARTA station and Mercedes-Benz Stadium.
Several council members have expressed concerns about the size and complexity of the deal, including whether the benefits to taxpayers are commensurate with the potential public investment that could total $1.75 billion.
Earlier Monday, Bottoms said she wasn't opposed to such a review, but said any delay could scuttle the deal and the potential headquarters relocation of Norfolk Southern, which wants to sell Gulch land to CIM and use that money to potentially relocate from Virginia to Midtown.
To speed the process along, Bottoms said she had sought help from the Georgia Municipal Association to identify a consultant to conduct the audit and to keep a potential Gulch vote from being delayed.
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Eight council members, a voting majority, sponsored the audit legislation. But three, including one sponsor, council members were absent from Monday’s meeting, and co-sponsor Michael Julian Bond was not in the room when the vote was taken. It ended up two votes short of the eight needed to pass.
Several community groups spoke in favor of the audit, while others urged council to reject the deal, saying promises of affordable housing and other public benefits weren’t sufficient.
“We are depending on the numbers and the word of a developer that is in line to take billions of dollars in public money,” said former state Sen. Vincent Fort, an opponent of the deal. “I can see why CIM doesn’t want an independent review. What does the mayor and council have to hide?”
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To make the site feasible, it requires constructing massive $500 million steel and concrete platform spanning 40 acres that CIM has said it will pay for.
But the company wants to use future tax dollars created on site to help ensure investor returns.
The proposal relies on bonds backed by two sources of public funding: 5 cents of the city’s 8.9-cent sales tax generated from future sales on the Gulch site, and future expected increases in property taxes from the development, which lies in a zone known as a tax allocation district.
Four of the five cents are state tax dollars. The overall financing, CIM co-founder Richard Ressler has said, would come at no credit risk to the city because CIM is on the hook for the debt if the tax dollars don't cover all the bonds.
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