Sunday, June 15, 2014

The Bet that Financed Atlanta's BeltLine Pedestrian-Bicycle Transit Loop

View of construction from the Atlanta BeltLine Eastside Trail (Marc Merlin)
Although Atlanta's BeltLine, a pedestrian-bicycle-transit loop circling Georgia's largest city, was a vision described by Ryan Gravel in his master's thesis while a student in architecture at Georgia Tech in 1999, what made it a reality a dozen years later was some visionary creative financing.

Where would the BeltLine supporters find the money for the project? There was no way on Earth that the City of Atlanta would be able to come up with the billions - yes, billions - of dollars that it would take to make the BeltLine happen. And there was no way in Hell that the State of Georgia - which had never deigned to give Atlanta's struggling transit system MARTA a dime - was going to pitch in to help out.

The solution, called a Tax Allocation District or TAD, involved placing a bet on the BeltLine's success.

The property around the proposed BeltLine route was not being put to much use - which is part of what made Gravel's idea feasible in the first place - and, as a consequence, was not generating much tax revenue. Yet, school systems, among others, had claim to the meager taxes that were being collected.

If the BeltLine turned out to be successful, the property values in its vicinity would increase significantly. No one had claim to the corresponding increase in property tax revenue, at least not yet. The TAD was a way for the BeltLine to stake that claim.

Since the way school systems are funded was implicated in this kind of financing scheme, there were legal hurdles that had to be jumped. It was decided that TADs required an amendment to Georgia's constitution, which in turn required the approval of its citizens in a statewide referendum. TAD supporters were mobilized and the amendment passed, although not by very much.

All it takes is a walk along the Eastside BeltLine Trail today to witness the amount of renovation and new construction completed or in progress to see how handsomely the TAD wager has paid off. It stands as a reminder that all sorts of creativity have to be brought to bear to make visions for large-scale public projects like the BeltLine a reality.
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