City of South Fulton is financially viable

Mon, 08/20/2007 - 9:02am
By: Ben Nelms

The new city of South Fulton is still viable. That was the conclusion of revised figures released last week by Georgia State University’s Prof. Robert Eger, noting that the new city will be in the black by approximately $900,000 for its first year of operation if voters approve the charter in the Sept. 18 referendum. The most outspoken opponent of the new city, Fulton County Commissioner Bill Edwards, is unconvinced that the figures will work. Standing diametrically opposed to that viewpoint is South Fulton Concerned Citizens who say Eger is on track.

Calculated on a conservative basis, Eger put the estimated annual revenue at $54 million and estimated annual expenditures at $53.1 million, for an estimated surplus of $878,914.

Eger and his team took into account the recent re-assessments of property in Fulton County and the reduction in the millage rate from 5.731 mills to 5.659 for the Special Service District, the tax paid by residents of unincorporated south Fulton in addition to taxes paid into the county’s General Fund.

“The city has always been in the black,” Eger said Tuesday. “This is without the new assessments figured in, so there’s probably a bigger reserve than what we’ve calculated. And that is even after the millage rate was decreased by .072 mills.”

Whether in his work with the new city of Chattahoochee Hill Country, approved by voters in June, or with the proposed city of South Fulton, Eger maintained that a conservative approach to viewing the fiscal basis of a new municipality is the most effective way to gauge viability.

“An important assumption in our analysis is a growth rate of zero percent. Although the South Fulton area has been growing on average at a rate of about 5.28 percent annually as projected through a thorough assessment of the Atlanta Regional Commission and the Fulton County demographer’s estimations, we assume no growth in the area to provide a conservative financial estimate,” said Eger. “We have also assumed no change in the appraised value of properties in the area from the FY2006 tax digest. While we know that Fulton County property valuations are increasing on an ongoing basis, the exact changes are not yet available, and the extent of the property value change is controlled by the county assessor’s office. These two assumptions, zero growth and zero change in property values from FY 2006, result in an under-reporting of anticipated revenues, providing again a model that generates a conservative financial estimate.”

Questions over the viability of the new city arose after more than 13,000 acres of prime commercial and industrial property was annexed by existing cities in south Fulton in 2006.

“To establish the estimates for the city of South Fulton, we examined numerous documents, spoke with many individuals at Fulton County and other related governments and institutions and researched current legislation at the state and local level,” Eger said. “These estimates include areas annexed in the unincorporated South Fulton Tax District as shown in Georgia House Bill 725, signed into law by Governor Sonny Perdue on May 18, 2007.”

As has been customary for more than a year, there are those on both sides of the city equation. For his part, Commissioner Edwards maintains that concerns over what he describes as the new city’s lack of political leadership and questionable financial feasibility are reasons enough for voters to reject the new city in September.

For their part, SFCC and others are standing by Eger’s assessment of the viability of the new city. SFCC maintains that Edwards is opposed to the new city because he is fearful of losing his power base that is tied largely to future economic development.

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