Op-Ed: Good Thing Annex Effort Died

Judd Owen lives in Decatur with his wife and two children. He has served on the enrollment committee and annexation committee for the City Schools of Decatur.  He teaches political science at Emory.

The first of a two-part series.

By Judd Owen

Decatur Metro directed readers last week to a brief story in the print edition of the AJC reporting that Decatur City Manager Peggy Merriss had said that “potential annexation of two heavily commercial areas outside the city limits has apparently died quietly in the legislature.”  I have been keenly interested in the push for large-scale annexation that has just died, and I’ve followed it closely since I first learned of it in October 2008. So I decided to write an obituary.

I have tried always to be even-handed and objective, but it will come as no surprise to anyone that has talked to me on the subject or seen what I’ve written when I say, “Thank God it’s dead. Rest in peace.”  Before going any further, I eagerly say that I have great respect for the City’s leadership that has built the wonderful city that attracted me several years back. They have clearly done an amazing job with foresight and will and intelligence. Decatur is not the great place it is by accident, and I’m grateful. 

In returning to my obituary, however, and because it is an obituary, I will let myself be blunt.  Large-scale annexation was ill conceived from the start, and it deserves the fate it got.  The poor conception of the idea was out of all proportion to the effort and political capital that was spent to make it reality.  On June 26 2008, the AJC’s April Hunt quoted Mayor Bill Floyd as saying that, as home values plummet, more income from taxes on additional commercial and industrial real estate would help stabilize property taxes. Floyd said: “Quite honestly, you’re talking about our survival as a city, when 60 percent of our income comes from property tax.”  A consultant from UGA was hired to conduct a study.  The City Manager’s office spent many hours preparing a large-scale annexation plan.

And large-scale it was.  It was not, however, focused on increasing commercial and industrial property; it would have brought in a large number of new residents, increasing the population by 45%. The City Manager’s office, with the help of another consulting (and architecture and engineering) firm, prepared a formal report.  I will not relive the details here, but suffice to say that the report was deeply flawed in its estimation of the impact of annexation on the City Schools of Decatur.  The number of students was grossly underestimated, as were the costs associated with the underestimated student number.  When those numbers were made even remotely realistic the modest tax benefit on the CSD side turned into a massive financial loss.  Add to this the fact that CSD was just starting to realize the large spike in enrollment within the current City limits that continues on today.  The financial hit on CSD by far outweighed the potential gain on the smaller, City side of the tax ledger. The proposal had never been seriously examined on the tax question, which had seemed to be its reason for being.

CSD had not been involved in that report, nor was it the City’s plan to seek a School Board review.  But when the schools caught wind of the errors in the City report, their own analysis led the School Board to reject large-scale annexation, while narrowly approving a more limited annexation targeting commercial property.  The City Commission suspended the process, on Ms. Merriss’s recommendation of January 14, 2009, to allow time for “the City Schools to develop and implement a plan to address current school population issues.”

Most people are aware that CSD’s “population issues” have, if anything, grown more challenging since then.  Yet it was just this time last year, March 27, 2012, that Mayor Floyd, in what we did not then know would be his final State of the City address, put large-scale annexation back on the table.  He did not mention any tax benefit this time, but instead his wish for the City to have a say in the redevelopment, featuring a Walmart, of Suburban Plaza which lies outside the City.  A new plan was drafted.  Again it was large-scale, and again the proposal was by a large majority residential, not commercial.  And once again, after more intensive study, the School Board said that it still did not want residential annexation, which would exacerbate overcrowding and hurt the schools financially. 

So the City Commission, under Mayor Floyd’s leadership, voted in December to pursue a more limited, though still significant, annexation targeting the commercial properties around the planned Walmart and the Publix on N. Decatur.  Three days later, Mayor Floyd resigned citing potential conflict of interest with work of a consulting firm that was about to hire him.  The new Mayor, Jim Baskett, frankly admitted that he did not see how the approved annexation plan would make it through the state legislature.  And so the plan that had started out being about commercial tax revenue and ending being about managing the appearance of a Walmart, which had been lobbied for over several years without (and at some point despite) a competent evaluation of its tax implications, which always tried to include heavy residential areas despite a clearly overcrowded school system, this plan was left to die quietly in the legislature, without a sponsor.

Now, the second time around, the process did include a consultation and collaboration with CSD, which marked great improvement in the process.  And the final proposal was indeed much improved thanks to that process, which should be model.  But I will admit that I opposed even this improved proposal.  The City Manager’s report on this targeted commercial annexation showed, to my amazement frankly, very little financial gain for the City once the additional costs were accounted for.  So after all of that, the tax benefit was negligible, even for the City side of the budget.  At that point,  with no real financial gain, what did the annexation amount to except the creation of a City of Decatur Walmart?  The new, official “gateway to the City.”

For me, I’m happy to leave Walmarts to DeKalb County.  This is just my personal view of Decatur, of course, but I don’t want a City of Decatur Walmart.  I like the City’s new slogan for buying local: “Keep it Indie-Catur.”  That’s awesome.  It was also the brainchild of Decatur residents.  Ironically, that slogan was announced the same week that Mayor Floyd announced his wish to annex Walmart.  Somewhere, on this big issue at least, there arose a disconnect between the vision of Decatur that I think is generally held by its residents and the vision held by its political leadership: Indie vs. Walmart.  The City Commission is no longer under Floyd’s leadership, and time will tell how they steer the City under Mayor Baskett. Keep it Indie-Catur!

(In the next installment, Owen will consider where the large-scale annexation push has left us with a view to current and future issues confronting the City and CSD.)