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Atlanta City Council Narrowly Approves Gulch Development Deal

After several hours of public comment, the Atlanta City Council narrowly approved a deal to develop the the 40 acres of parking lots and railroad tracks under State Farm Arena, known as the Gulch.
After several hours of public comment, the Atlanta City Council narrowly approved a deal to develop the the 40 acres of parking lots and railroad tracks under State Farm Arena, known as the Gulch.
Credit John Bazemore / Associated Press file
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The proposed deal to redevelop the Gulch has been hanging in the air at Atlanta City Hall for more than two months, and very late Monday night, it passed narrowly.

After pushback from Councilmembers and loud opposition voices from the public, this was the fourth attempt by Mayor Keisha Lance Bottoms’ office to bring the deal up for a vote. The deal was made up of four pieces of legislation, and the two controversial items approving tax incentive mechanisms passed 8-6.

The deal promises a $5 billion mixed-use development at the 40 acres of parking lots and railroad tracks under State Farm Arena, in exchange for up to $1.9 billion in public financing. The proposed developer is CIM Group, which was co-founded by Richard Ressler, the brother of Tony Ressler, the owner of the Atlanta Hawks.

Two overflow rooms were opened, and more than 90 speakers were signed up at this City Council meeting to speak. Public comment lasted about six hours.

Then two hours-worth of amendments were presented and debated; a few were successful, including a requirement that, should the possibility ever present itself, Norfolk Southern and CIM Group will maintain the space for passenger rail at the Gulch site.

“It gives me great pause and it gives me a lot of concern that all of a sudden we’re bringing all these things up now,” Councilmember Cleta Winslow said of some of the proposed amendments. She authored the legislation. “I don’t want [CIM] to walk away … nobody wanted this area south of Marietta Street. The property has been for sale since 2005.”

This was also the second version of the deal negotiated. The main change between the original deal, and the updated one is that the Westside Tax Allocation District will no longer be extended. One participant in the district, Atlanta Public Schools, expressed concern with signing on for a longer time period.

A tax allocation district is an economic development tool that freezes property tax values and commits the projected increased value to the development. Those are tax dollars that would have gone to the City, county and public school system. The revised deal works within the original 2038 deadline for the Westside Tax Allocation District, apparently nullifying APS’s concerns. The change does not affect the amount of money the developer will have access to, though.

While other meetings’ public comments had largely been dominated by those against the idea, business leaders and private citizens showed up to speak in favor of the project Monday, including former Mayor Andrew Young.

AJ Robinson is president of Central Atlanta Progress, a downtown business organization.

“It’s time to do something for the southern half of our city. We should all ask ourselves what kind of city do we want to be?” he said. “Nothing in the world is perfect, but we’d be kicking ourselves if we didn’t seize this once-in-a-generation opportunity to fix this hole in our city.”

Julian Bene a former Invest Atlanta board member and leader in the “Redlight the Gulch” campaign against the deal called it a “bucks for billionaires scheme.”

“Everyone who has come forward to speak about the Gulch has failed to mention what it will cost taxpayers,” he said. “Are you on the billionaire team or are you on the constituents team?”

Deborah Scott is with Georgia Stand-Up. She said the City has mishandled the deal in terms of community engagement. “The community engagement was not done correctly. There’s already a bank of trust that has been depleted. How do we build it back up?”

“We’ve been a forward-thinking city,” Winslow said after the vote. She compared the Gulch deal to the early idea of building Hartsfield-Jackson, which is now the world’s busiest airport. “Tax incentives are a tool that everyone is using, but we try to use it in a good way. In areas that are underserved. In areas that are underdeveloped.”

Mayor Keisha Lance Bottoms spoke to Council just after it passed. “If the hour were a bit earlier I’m sure there are many profound things I would have to say,” she said. “I do trust that history will be kind to us and that we will be judged on how we lead this city. But what I do believe is we have created a new model that will be replicated.”

Much has apparently been at stake. The CEO of Norfolk Southern railroad company Jim Squires told the Atlanta Journal-Constitution the Gulch deal is crucial to complete a plan to move its headquarters to Atlanta. The company needs the money to pay for the relocation, he said.

Councilmember J.P. Matzigkeit, who had previously challenged parts of the deal, said he changed his mind because the opposition “got us to a much better point and a much better deal for the City.”

The deal attracted much opposition early on, from people complaining about how this would worsen many of the city’s issues, including an affordable housing shortage and gentrification. Councilmembers, too, pushed back on Bottoms’ attempts to get the deal passed quickly, hence the more than two-month-long timeline.

“I believe the rewards of this deal far outweigh the risks, and that’s why I voted for it today,” Matzigkeit said.

Councilmember Amir Farokhi voted no on the deal, but said: “It’s going to be exciting to see the Gulch come to life, no matter how we voted on this.”

“I think we would have been better off investing more time in public conversations around the city, even though this was a hyperlocal project,” he said. “I respect the outcome; this has been a true democratic process.”