New analysis: Buckhead de-annexation would damage APS and City of Atlanta, economically harm the metro region & state of Georgia
Cityhood would threaten quality of life for Buckhead residents, increase tax rates
Atlanta — A fiscal analysis on the consequences of the Buckhead neighborhood proposed de-annexation from the City of Atlanta determined that the Atlanta Public Schools (APS) and the City of Atlanta would stand to lose financially, economically and socially. In addition, the study concluded that tax rates would likely rise for Buckhead area residents and quality of life may suffer.
"This study clearly shows that breaking up Atlanta is a bad idea. It’s bad for Buckhead. It’s bad for Atlanta. It’s bad for the metro region. And it’s bad for the State of Georgia," said Linda Klein, co-chair for the Committee for a United Atlanta.
The study assessed the fiscal impacts of the Buckhead area de-annexing (leaving) the City of Atlanta from the perspective of APS and the City of Atlanta. Some of the key findings include:
The annual net fiscal loss to the City of Atlanta would range from $80 million to $116 million.
For APS, the school district would be substantially depleted, with an estimated $232 million loss annually.
Issues regarding service of current debt and future debt, economic development disunity, and reduced community services are all likely to be significant difficulties for the City of Atlanta, APS, and the Buckhead area if a de-annexation would move forward. Each would stand to lose financially, economically, and socially.
It is almost certain that Buckhead area residents would pay higher tax rates due to the need to refinance debt assumed for existing infrastructure and start-up spending. In fact, both the City of Atlanta and Buckhead residents will see taxes raised because of the loss of combined financial resources.
Because both Buckhead and Atlanta would be weaker entities if separated, economic development initiatives will suffer. Should Buckhead de-annex, Atlanta will not only continue to compete with Charlotte, Nashville, Houston, and Dallas, but it will find itself competing with a part of its former self. The result could easily be a race to the bottom with both entities giving away critical financial resources in a zero-sum game of economic development gamesmanship.
If de-annexation would occur, public education will be a major problem for Buckhead families and kids. APS owns all public schools in the Buckhead area, and the Georgia constitution prevents creating new school districts.
The Georgia General Assembly will have to have to pass legislation permitting de-annexation while then allowing for a referendum to take place in which only those residents in the new designated city would be allowed to vote.
De-annexation of a major city has never been done before in Georgia.
Edward Lindsey, co-chair for the Committee for a United Atlanta, cautioned the State from acting rashly:
"De-annexing the Buckhead area would likely have a destabilizing impact on the State of Georgia. Unlike forming a city out of unincorporated parts of a county, like Sandy Springs or Brookhaven, de-annexing part of a big city has never been done before and will set a dangerous precedent. Other neighborhoods in cities throughout Georgia may suddenly decide to break up key parts of their city. No doubt, it will risk the reputation of Georgia as the best state in the country for business."
Klein also cautioned on the social unrest that could occur if Buckhead is carved out of the City of Atlanta:
"Rather than engage in divisive and self-defeating efforts, let’s work together to improve the lives of our citizens."
The analysis was conducted by KB Advisory Group, an Atlanta-based consulting firm founded in 2001. KB provides real estate and economic development consulting services to cities and counties throughout the southeast. This study relied on readily available public revenue and expense data related to the Buckhead area for the City of Atlanta, and used widely accepted approaches to assess fiscal impact, based on proportionality of local population and employment. The report was paid for by the Buckhead Coalition.