Friday, November 2, 2018
FOR IMMEDIATE RELEASE
November 2, 2018
STATEMENT FROM “REDLIGHT THE GULCH COALITION”
ON NORFOLK SOUTHERN ULTIMATUM
Norfolk Southern’s CEO says that unless his company can make a big profit on its land in the Gulch, it will not consolidate staff from Norfolk, VA to Atlanta.
There is no justification for throwing a Gulch public subsidy — variously put at $1.9 billion and $1.44 billion — at an 850-job move.
The typical incentive from the City for that number of jobs is $850,000 to $2.5 million. That’s Million with an M, not Billion with a B. Some companies do not choose to extract any incentives when moving to the city.
The public cost of the Gulch scheme is on the order of one thousand times the incentive justified for the Norfolk Southern jobs.
By contrast, Blackrock announced last week that they are creating 1,000 new jobs in the city. They did not require billions in subsidy. Like Atlanta residents, they were also unfazed by the Gulch. Like all the other companies moving to and expanding in Atlanta over this decade, Blackrock is coming for our talent, our universities, our airport and our standard of living.
We also remind residents that Norfolk Southern did Atlanta no favors when they sold their stretch of the future Beltline to a developer for $25m, which forced the city to $65m — vastly more than if Norfolk had waited and sold it to the city directly.
We call upon Council Members to resist absurd last-minute arguments and bullying. The Gulch scheme would squander future revenues desperately needed to run our city and schools, and to support housing affordability.
Redlight the Gulch on November 5!
Wednesday, October 24, 2018
Sunday, September 30, 2018
TOP 10 REASONS WHY ATLANTA'S GULCH DEAL IS BAD FOR THE CITY'S FUTURE
1. Public cost is 55 times the public benefit. This is a grossly disproportionate cost/benefit in CIM’s favor. Council has done well to hold it. This deal is so terrible that Council now needs to walk away from it. You don’t negotiate when the gap is so enormous between what the billionaires are demanding from the public and what their scheme is worth to the public
2. Public cost is about $2.5Bn at 2018 prices, of which $2Bn is property tax and $0.5bn in sales tax. In return, public benefits are only worth about $45mm. Details are broken out below.
3. When the public is putting in as much as 50% of the cost to develop a private, commercial project, the public should own 40% of it. Instead, we will own nothing. The only explanation for this grotesque imbalance of advantage is CIM’s Abject Greed.
4. The numbers. Property tax on a $5bn project when it’s complete - in 2032, per developer’s schedule - would be $90mm / yr. APS (the schools) would be losing out on $45mm / yr and the city and county $22.5mm / yr each.
5. Despite all the smoke from the project’s boosters, this lost property tax really IS a cost to the public. Because if offices, hotels etc. are NOT built in a tax-free Gulch, they will be built in taxable parts of town, such as Tech Square, Midtown, S Downtown, Atlantic Station, Buckhead and around the Beltline. If CIM does not get this deal, the demand for office space, etc. will be met by developers in places where new construction pays taxes. In other words, this Gulch scheme ‘cannibalizes’ a massive amount of commercial growth and deprives the city and schools of future revenues for 30 years.
6. The same is true of the sales tax. This scheme would short the city and the state of some $500mm at 2018 prices thru 2048. Retail sales demand is not going to be created by putting stores in the Gulch. Those sales are going to happen somewhere in town, and the only question is whether they pay tax to the state and the general fund or not. Again the Gulch scheme would ‘cannibalize’ or displace retail activity in town and rob the state and city of tax revenues needed to pay for public services. So the total revenue loss IS $2.5 Billion. That is over $5,000 per man, woman and child resident in the city. It is equivalent to a $20,000 donation or more from every family of four in Atlanta to the billionaire Ressler brothers.
7. The public benefits that have been dribbled out amount to around $45mm. The different cash funds are easy to add up: $42mm (though with no guarantee they’ll be spent to create real community benefit). The 200 housing units affordable at 80% AMI are worth only about $3mm, because CIM can sell them off after 3 years as rentals. CIM could sell the 200 units at prices for which a buyer would need an income 20% higher than the area median. By definition, that’s not affordable. Forget the claim that there might be some extra units for low-income folks: that’s only if AHA pays for them, which means it costs CIM nothing.
8. The hard sell for this deal pretends that it brings 37,000 jobs to town. That is nonsense. Employers bring jobs to town – over 40,000 new jobs have moved here in the past 6 years – NCR, Worldpay, Honeywell, Anthem, Kaiser and so on. They locate here for our competitive talent, universities and airport. Office towers do not bring jobs here. (If they did, we’d have had no unemployment in the great recession, because we sure had masses of empty office towers, including the biggest - Bank of America Plaza.) So the scheme does not bring one single job here. CIM is betting that the city will continue to attract employers to fill the huge office towers that they are planning to construct. But this scheme does nothing to attract those company relocations. In fact, if Council allows this crazily one-sided deal, smart company executives will question the city’s financial responsibility. They’ll wonder if a city too busy to think can be trusted to provide good
schools and public services for their employees.
9. Similarly the CIM sales pitch takes credit for 1800 construction jobs. But office towers are going to be built in the city to meet employer demand. So the same construction jobs will be here, whether those offices are built in the Gulch or in S Downtown and elsewhere. Handing over a $2.5bn subsidy will not result in more offices being built than are needed - or more construction jobs.
10. The final arm-twist on Council has been a Norfolk Southern deal. NS wants us to give this enormous subsidy to CIM so that NS can sell Gulch land to CIM at a big profit. There’s nothing in that for the public. But NS might move 1,000 HQ people here in a consolidation. To justify a $2.5bn subsidy, we’d need not 1,000 jobs but about 700,000 jobs! That’s around three times the entire number of jobs in the city. It’s also 14 times the size of Amazon’s HQ2, for those who still imagine HQ2 will choose Atlanta.
Tuesday, September 18, 2018
Monday, September 17, at the Darlington Apartment Complex in Buckhead tenants and community allies held a rally to shine a light on their inhumane treatment by landlord Trace McCreary of Varden Capital Properties who purchased the longtime affordable complex a year ago.
At the time of the purchase tenants were told they would finally receive the renovations which where decades overdue only to be told in late august that they would all be forced to vacate the property indefinitely.
Since the time of the 60 day notice tenants were given in August the AC has been shut off and there have been four fires inside the complex. “There is no peace for us , days without hot water to bathe , laundry machines that destroys our clothes , & a Owner who would allow kids in this building to have to go to sleep in puddles of sweat from no Air. This is Not Fair , This is not Right , This is not Justice !” stated Darlington tenant LeBraunte Frost.
This kind of property flipping is nothing new to Varden Capital CEO Trace McCreary who apparently left Wall Street after the financial crash to focus on building wealth off the crisis the left 11 million Americans without a home. So far Varden Capital has purchased around 20k units in the South almost all of which are occupied affordable units which he then flips mostly luxury displacing current residents.
At this point residents simply want support identifying affordable housing in the communities they live and work in which has been a major challenge.
Atlanta is experiencing a perfect storm for mass displacement. With 95% of everything built since 2012 qualifying as luxury housing and a loss of 5% of affordable housing stock every year since 2012 we may be experiencing the largest displacement of long term residents in Atlanta history. “ For those of us who live in the few affordable housing available in the city we find ourselves displaced with the race for newer properties and affordable properties renovating to keep up”, stated Darlington tenant Raymond Bushby.
You can take action!
CALL THESE NUMBERS
Jennifer Eid, City Council Representive, District 6: (404) 330-6049
Matt Westmoreland, Post 2 At Large City Council: (404) 330-6302
Michael Julian Bond, Post 1 At Large City Council: (404) 330-6770
Keisha Lance Bottoms, Mayor: (404) 330-6100
“I am calling to express my great concern for the forced displacement of tenants from the Darlington. What will you be doing to ensure ALL tenants are relocated to safe, decent, affordable housing? What will be doing to ensure that this mass eviction events like this are no longer acceptable in Atlanta?”
Links tosome of yesterday's press coverage: