Union City Council has taken what it calls the next step in revitalizing the area around Union Station and Royal 85 Business Park, both located adjacent to I-85. Council members March 20 adopted a resolution to revise the Union City Town Center Redevelopment Plan and create a Tax Allocation District (TAD) in the two designated areas. The move awaits approval by the Fulton County Commission and Fulton County Board of Education.

Approved by voters in November, City Administrator Terrell Jacobs said the purpose is to improve the infrastructure of business, residential and community areas through a process intended to redevelop and revitalize the town center area. The objective is to stimulate and encourage mixed residential and retail development and warehouse space with greenspace and walkable connections.

The TAD will place no additional tax burden on property owners, Mayor Ralph Moore said in an earlier statement. TADs provide money for redevelopment, but are not a tax increase for residents or a tax abatement for developers, he said.

“The property tax rate remains the same as before the TAD was created,” said Moore. “However, the TAD establishes new streams of revenue for the city from increased property values after development.”

If approved by the Fulton County Commission and Fulton County Board of Education, 2007 would be the base year for the 634.75-acre TAD area of Union Station and Royal 85. As of December 2006, the area’s total market value was approximately $101 million, with an assessed value of the area is approximately $40 million. By law, TADs cannot constitute more than 10 percent of a city’s taxable digest. As adopted, the TAD complies with those parameters, city officials said.

By definition, values in the TAD would be frozen at the time the measure is implemented, with property tax dollars forming a base amount to be built on in successive years. Increases in property tax revenues within the TAD in succeeding years due to re-valuations would be used to pay off the bond money used for redevelopment rather than going to the General Fund.

“The city, the county and the school maintain the base,” Jacobs said. “The additional amounts of tax revenue generated beyond the base go to paying off the bond indebtedness that helped finance development in the district. The base cannot be more than about 10 percent of the city’s overall tax base and it looks to help establish development or redevelopment in a given area. In actuality, it freezes that base year of taxes and whatever the increase of appraised value in that area, in terms of future property re-valuations, that money is used to help take care of the financing of the bonds you would use for the development.”

Bond funds extend for 20 years and are used to install infrastructure, such as roads, streetscapes and other amenities and development costs, that would be needed to draw businesses to the area. Particular to Union City’s TAD area is the presence of a large mass of granite just below the ground surface, a factor that presents time and money challenges to development. Overcoming some of those costs can also be addressed by bond funds, Jacobs said.

“This is an economic development tool used to help finance economic development in a specific area in a community,” Jacobs said in summary. “The tax dollars are generated by the businesses in the TAD to help themselves. Funds used within the TAD are not generated by anyone outside the TAD, only by those within the district.”

Moore said the measure will go before Fulton County Commission April 4 at 10 a.m. He asked that interested residents attend the meeting to support the TAD. The next step would be approval by the Fulton County School Board. If approved by both bodies, the TAD will take effect Dec. 31 with bonds issued in early 2008.

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