Planned multifamily project could impact Main Street TAD revenues

Tax district questions arise over proposed Cartersville development

By JAMES SWIFT
Posted 12/31/69

A first reading of a rezoning request that could potentially pave the way for a 200-unit apartment complex near the Kroger Marketplace shopping center on Main Street drew a litany of questions at …

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Planned multifamily project could impact Main Street TAD revenues

Tax district questions arise over proposed Cartersville development

Posted
A first reading of a rezoning request that could potentially pave the way for a 200-unit apartment complex near the Kroger Marketplace shopping center on Main Street drew a litany of questions at last week’s Cartersville City Council meeting. 

At the heart of the matter was whether or not the proposed multifamily development impacts the tax allocation district (TAD) status of the original shopping center development. 

“Since this was originally supposed to be, when the TAD was started, to be part of a retail development, since the nature of the development is changing, does that in some way jeopardize the TAD funding that was in place for the first portion of this?” asked Cartersville Mayor Matt Santini. “Are you doing something that the bonding agencies — is there some benefit that they got on the front end that may make them liable if they’re changing this?”

Applicant Cherokee Main Street III, LLC — represented by Robert H. Ledbetter, Jr., of Rome’s R.H. Ledbetter Properties, LLC — seeks the reclassification of a 16.7-acre parcel off East Main Street from G-C general commercial and mining to MF-14 multifamily residential. 

Joshua Cox, a civil engineering consultant who worked alongside Ledbetter on the initial phase of Kroger Marketplace development, told members of the Cartersville Planning Commission that the site sought for the apartment complex already has utility stubs available at a public meeting held on Aug. 11.

City of Cartersville officials signed off on roughly $3 million in “tax-exempt debt” to get groundwork underway on the approximately 53-acre Kroger Marketplace shopping center site, which was previously used as both a mining property and a landfill. 

City documents from 2014 describe a TAD as “an area where the increase in the tax digest above the current value is taxed, but instead of those funds going to the taxing jurisdiction, they are used to pay for various infrastructures.” 

A 2014 resolution established the TAD increment base at $1,138,531.52.

“The total assessed value of proposed redevelopment Phase I and Phase II is $7,529,992,” the City-approved urban redevelopment plan reads. “This is a net taxable increase of $7,074,579.39 … a bond issue of approximately $2.3 million is anticipated.”

While the TAD resolution specifies what the diverted tax funding may be used for — primarily, the “acquisition, construction and installation of site work” and infrastructure improvements — the document does not specifically define what types of vertical developments are allowed or not allowed to emerge from that groundwork.

The resolution, however, does indicate “tax-exempt debt” could be issued for “in-line retail buildings in connection with the East Main Street Tax Allocation District,” making no explicit mention of residential or other commercial uses on said properties.

Santini’s inquiry brought R.H. Ledbetter Properties, LLC Vice President of Development Joe Holmes to the podium.

“We don’t believe the multifamily component of the Phase II project will jeopardize our existing Phase I TAD,” he told council members. 

Cartersville Assistant City Attorney Keith Lovell, however, said the proposed development could still impact future TAD payments on the development.

“Since a portion of this property will now be used for things that aren’t allowed in the TAD, if any of this was actually under the TAD itself, that part may be taken out,” he said. “And that part may be taxed at its full, normal value.”

Ultimately, Lovell said the final determination on the matter would be made by the Bartow County Board of Tax Assessors and the City of Cartersville Finance Department.

“There may be changes and there may be no changes,” Lovell said. 

Holmes said Ledbetter Properties representatives will remain in contact with the City of Cartersville, as well as bonding agency counsel, regarding the issue.

The applicant is also seeking the annexation of about 1.94 acres of Bartow County mining property into the City of Cartersville, as well as that parcel’s subsequent rezoning from M-1 mining to MF-14. Members of the Cartersville Planning Commission voted 4-1 to recommend approval of both requests at a public meeting earlier this month.

Cox said that parcel will be used solely for the expansion of a detention pond. Holmes indicated the proposed multifamily project would be owned and operated by the developer.

The Cartersville City Council is set to hear a second reading of — and subsequently vote on — the annexation and rezoning requests at a public meeting scheduled for Sept. 3. The hearing will take place at 7 p.m. at 10 North Public Square.