Legislation allowing development of 'private cities' gets new life
Macon Telegraph, 2/27/2007
Travis Fain

ATLANTA - Legislation has been revived that would give developers a new way to finance projects that basically amount to new towns.

The idea is often called "private cities," though backers cringe at a label they consider to be a misnomer, as well as at the unpopular images the name conjured up last year as similar legislation died.

The new legislation exempts the controversial Oaky Woods land in Houston County, meaning it could not be developed as a so-called private city, said state Sen. Johnny Grant, R-Milledgeville, the bill's sponsor.

Grant is quick to point out that developers wouldn't be given the power to condemn anyone's property under his proposal. That's a big part of what killed the concept last year, when Macon state Sen. Cecil Staton and Houston County state Rep. Larry O'Neal were pushing similar bills.

Staton said the power of eminent domain, which is the process of taking private property for public uses, was never meant to be in his proposal last year. But an editing error in the bill, lazy reporting in the media and Democratic Party backlash against the bill left people thinking it was there, he said.

Regardless, Grant's Senate Bill 200 specifically states that any district formed "shall not have the power of eminent domain and nothing in this chapter shall be construed to give a district such power."

And before any districts could be created, voters would have to agree to change the Georgia Constitution in a statewide referendum. The local governments in the individual counties and cities where the districts would be located also would have to hold public hearings and approve each district on a case-by-case basis.

Districts would amount to near-cities with their own elected boards and some taxing powers. They wouldn't have police powers, but could provide added security, similar to a gated community.

Particularly important would be a district's power to assess fees and property taxes above and beyond local government taxes, which property owners still would have to pay.

That's the key to the concept, Grant said, because it gives developers a way to pay off the debt it takes to finance the construction of new homes and businesses, infrastructure, et cetera without burdening taxpayers citywide or countywide.

"(It's) an additional financing tool so that they can handle the growth that's coming to Georgia," Grant said.

But the idea has many of the same critics it did last year.

"Does anyone seriously think that Georgia is not developing rapidly enough?" Neill Herring, a lobbyist for the Sierra Club, asked last week.

Herring provided The Telegraph with laundry list of potential legal problems in Grant's bill, which is lengthy and, at some points, complicated. But, in a more general sense, Herring said the bill will foster development of areas "that are better left undeveloped."

"These private cities are going to go into places without any assurance that there is an adequate water supply," Herring said in an e-mail. "There is no requirement that the nearby waters have assimilative capacity for their wastewater."

Then there's the issue of Oaky Woods, a vast tract of Houston County woodlands that figured prominently in last year's governor's race. Long a favorite stomping ground for hunters and nature lovers, Oaky Wood was put up for sale several years ago, and hunters and conservationists wanted the state to buy it.

But Gov. Sonny Perdue said the state didn't have the money, and the land was sold to a group of developers planning a mega-development of thousands of homes. When it became known that Perdue had purchased some 101 acres adjacent to Oaky Woods - but also adjacent to his longtime Bonaire home - and that the land had increased in value because of the proposed development, controversy ensued.

Last year's "private cities" legislation, which backers prefer to call "community districts" or "infrastructure improvement districts," could have been used to develop Oaky Woods. But with Oaky Woods' development being unpopular in Houston County - and the controversy surrounding it spelling potential suicide for legislation - Oaky Woods was exempted from Grant's bill.

The bill specifically states that any county with a capped millage rate can't create an infrastructure improvement district. Clint Mueller, legislative director for the Association County Commissioners of Georgia, said he's aware of only two such counties: Houston County and Columbus-Muscogee.

Herring said the exemption doesn't amount to any protection at all for Oaky Woods, and he produced a memo from the Southern Environmental Law Center to back that up.

"They'll be in Oaky Woods in one lawsuit ... and (bill supporters) know it," Herring said.

Mueller, who said the ACCG supports the bill, disagreed.

"We've had lots and lots of attorneys that have looked at that language," he said.

Mueller said these districts would be particularly useful in places expecting heavy growth, such as near the planned KIA plant in west Georgia, which is going to need new housing for workers. He likened the districts, and their governing boards, to a "large homeowners association."

According to Grant's bill, once area governments sign off on the creation of a district, the developers appoint a board of directors. The local governments also get appointments, but the legislation is set up so developers will be able to appoint a majority.

These board members eventually have to be elected by property owners, as land sells in the district, and each person's vote is weighted according to how much property they own. The board has the taxing power within the district, though there is a millage rate cap. It can also charge residents and owners other fees. It sets its budget and has the power to sue and be sued like a regular local government.

Staton said he hasn't studied Grant's bill yet, but he supports the concept.

"We can build something and let the people who move in to use it pay for it," he said.

Grant called the proposal "sort of like the perfect impact fee" and said he expects his bill, and the accompanying resolution calling for the constitutional amendment referendum, to be heard in committee this week.

The governor's office is withholding comment on the bill and will let the legislative process take its course, Perdue press secretary Bert Brantley said.

Because of the need for a statewide referendum and constitutional amendment, the legislation wouldn't take effect until 2009.

(Original URL: http://www.macon.com/mld/macon/news/politics/16784391.htm)

Also see:
Connecting dots on Sonny's Land Deals & Tax Breaks
Steve Scroggins, GHC, November 1, 2006

Oaky Woods Corruption Update
Steve Scroggins, GHC, December 7, 2009

Sonny won, public lost on his refusal to buy Oaky Woods
Marietta Daily Journal, November 5, 2006

Perdue Failed to Disclose Land Buy Near Prized Tract
Atlanta Journal-Constitution, October 28, 2006

Shipp: Perdue says no to conservation
Bill Shipp, Athens Banner-Herald, October 29, 2006