There’s a lot riding on the outcome of the proposed apartment complex in Auburn. Not only does that project hang in the balance, but also the town’s budget and the political future of its leaders may well depend on the outcome.
For those who haven’t followed the issue closely, here’s the background:
TBG, an Atlanta development firm, has proposed to build a 72-unit apartment complex in Auburn off of Mt. Moriah Road. But to make that happen, the firm wants to get around $800,000 in state tax credits for the project.
As part of its application for the tax credits, TBG has to meet certain criteria for which it can get “points” toward qualifying for the credits. In an effort to get more points, the firm talked to Auburn leaders about the town creating a transit system to serve the apartments and community.
Auburn leaders, especially Mayor Linda Blechinger, have been vocal advocates for getting additional rental housing in the town (currently 20 percent of Auburn’s residences are rental.) So the town agreed last spring, with Blechinger breaking a tie on the council, to start a city bus system to help TBG get the tax credits. TBG supplied the bus and gave the town $10,000 to kick off the system.
But the idea of a transit system in little Auburn was controversial from the start. The initial city budget created for the system indicated it would make money, although any objective look at the idea showed it would be a money-loser for the town. At a meeting in early June, several citizens spoke against the transit system.
But Blechinger and some other town leaders were unmoved by the critics and defended the transit system, known as ANT. The mayor and others said that although the transit system might cost the city a few dollars, if it helped get the TBG apartment complex in the town, the building permits and other income from the project would offset the cost of ANT.
So confident were city officials that the apartment complex was a done deal, the city council approved its FY2013 budget based on it by budgeting over $100,000 in new building permit income for the apartments. Again, Blechinger had to break a tie to get that budget passed.
But not everything was as it appeared. As first outlined in the Journal last week by reporter Erin Rossiter, TBG wasn’t telling Auburn leaders the whole story. TBG also owns another apartment complex in Barrow County near Barrow Crossings called Farmington Hills. Last year, the firm attempted to get the state tax credits to build its Phase II of Farmington Hills, but was unsuccessful.
Although Auburn leaders knew TBG had applied for tax credits for Farmington Hills last year, they never bothered to check and see if the firm was reapplying this year. As outlined in a Journal news article last week, Blechinger and other Auburn leaders were stunned to find out TBG was reapplying for Farmington Hills in addition to their Auburn project. TBG never mentioned it and Auburn never asked.
Not only did TBG reapply for Farmington Hills tax credits this year, the firm used the Auburn transit system to get extra points on its application for that project. Auburn officials thought the firm was using the transit system only for the Auburn project. In its paperwork applying to the state for the tax credits, TBG rated its Farmington Hills project higher than its Auburn project, a move that undercut Auburn.
Why Auburn leaders didn’t know about any of that is a mystery. All of the documents related to the tax credits are available online, yet Auburn leaders admitted last week that they never looked to see what projects were competing for the tax credits.
This week, reporter Rossiter outlines additional information about the TBG-Auburn relationship from looking at a series of emails between the town and the company.
It appears as if TBG pushed the town not only to create a transit system, but also to include Farmington Hills on its series of stops. In fact, TBG mentions Farmington Hills in a number of its emails with Auburn officials.
And as the emails make clear, TBG was careful to make sure the city transit system came not from TBG, but rather from the city. Auburn officials apparently never saw a red flag in any of that. Despite a large degree of public backlash, the city went ahead with the transit system last June.
So here’s where things stand today. Auburn is now about to go into its third month of its FY2013 fiscal year, but it still doesn’t know if the apartment complex will be built or not. Meanwhile, it continues to operate the bus system at a massive loss in the hopes the apartment project will get the tax credits and move forward. Nobody seems to know when the tax credits will be announced, although city leaders had thought that would happen in October.
If the Auburn project gets the tax credits, city leaders will look like heroes. Although the transit system has cost the city a lot of money, if TBG starts construction on the project in the next few months, the city will get new revenue.
But if the Auburn apartments don’t get the tax credits, the city will be in a financial mess and its leaders will have a large egg on their face.
Without the apartment complex, the city’s budget will be deep in the hole and will require further cuts. For the last four years, the city has been in the red, spending more money that it has been taking in. To balance its budget, Auburn has been drawing down its reserves. But now those reserves are starting to run thin and the city can ill-afford to be in the red this year.
Perhaps just as important, if this project blows up, it could change the political balance of power in Auburn. That would hit mostly at Mayor Blechinger, who has been a strong proponent of the apartments and the transit system. It was Blechinger who has several times provided the tie-breaking vote to create the transit system and to keep it going.
In the last few years, Blechinger has been Barrow County’s up-and-coming political leader. She is articulate and has done a lot of high-profile programs in Auburn since taking office. And she is often viewed as having higher political potential.
But the TBG and transit issue could derail her political prospects if the apartments don’t go forward. If Farmington Hills gets the tax credit and Auburn does not, the city’s resulting financial mess will be on Blechinger’s hands. Not only that, the mayor’s reputation as a political leader will be put under a cloud. The lack of due diligence by the city in this issue is appalling.
So what Mayor Blechinger wants in her Christmas stocking isn’t something for herself; she wants TBG to get the tax credits and for the Auburn apartment complex to move forward quickly. That would salvage both her reputation as a political leader and the city’s budget.
If that doesn’t happen, the lump of coal left will be a bad omen for Blechinger and Auburn to wake up to on Christmas morning.
Mike Buffington is co-publisher of the Barrow Journal. He can be reached at email@example.com.