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Date Posted: 16:03:38 11/20/09 Fri
Author: Donald F. Valtman
Subject: While we're waiting . . .

for GADoE to publish GCPSS's October 2009 FTE student count, ask yourself why the BoE is tripping over dollar bills to pick up pennies?

The BoE/Wilbanks must want parents/taxpayers to believe that more money = better educated students! If so, then (A) WHY is the BoE volunteering to give up at least $20 MILLION in local property tax revenues, and equally important (B) WHY don't GCPSS estimates and TAD District #1 estimates mesh?

(A) Rick Cost, Chief Financial Officer, estimates that by joining all 5 TAD ventures, it "will cost [GCPSS] $20 Million in forfeited property tax revenue ---". (See 11/13/09 AJ/C article entitled Gwinnett school district joins TAD venture for details) Not to worry though, because GCPSS has the taxpayer's back covered in 3 iffy ways:

First, if the BoE wins its lawsuit against the state/Ivy Prep, there likely won't be any more such 'Commission' schools. Therefore, the renewed annual receipt by GCPSS of around $800,000 in state QBE funds will cancel out the $800,000/year in local property taxes that GCPSS will lose by participating in the 5 TAD ventures,

second, if the BoE fails to win its lawsuit, Rick Cost calculates GCPSS will "recoup" the 'lost' $20 Million in ONE year after the 5 TADs are dissolved. "Recouping" a 'lost' $20 Million is an easy thing to say when you aren't wagering your OWN money! All it takes is to PRESUME that (a) Gwinnett County's commercial/residential property market eventually WILL RETURN TO PRE-RECESSION LEVELS, (b) increases in TAD property valuations with accompanying higher property tax receipts ACTUALLY will occur as forecast in each of the 5 TAD proposals, and (c) all this comes together so that ONE YEAR after (somewhere around 2035) the 5 TADs are dissolved, the revised TAD property valuations/tax receipts generate $20 MILLION in NEW PROPERTY TAXES, and

third, no big deal if neither of these options pan out. Other than LOSING around $20 Million, GCPSS can satisfactorily carry-on for as long as 25 years on historically low FROZEN property tax revenues from the 5 TAD areas because (a) these 5 TADs represent less than 5% of the County's property tax digest, (b) the FAR GREATER amount of interim school taxes from the remaining 95+% of the County's property tax digest can be spread around as the BoE pleases to cover any localized shortfalls, and (c) the BoE can UNILATERALLY RAISE the school tax rate in the interim and/or promote several interim E-SPLOSTs.

(B) Is $800,000 per year -- $20 Million divided by 25 -- a REALISTIC potential loss of GCPSS property tax revenues?

NO! Not if Rick Cost's numbers are measured by those projected in the 2nd largest TAD's (District #1, Jimmy Carter Boulivard) Proposal. This TAD claims that -- at build-out -- it will generate about $10.4 MILLION in NEW, ANNUAL property tax receipts! Assuming GCPSS's share of County property tax receipts remains about 60% and imputed TAD property tax increases are distributed evenly over a 25 year period, GCPSS's POTENTIAL MEDIAN ANNUAL PROPERTY TAX LOSS would approximate $2,870,000 rather than $800,000! And the District #1 TAD is ONLY ONE of the 5 proposed County TADs.

So what if GCPSS's annual 'lost' property tax estimates vary by a couple Million dollars over 25 years? Who's going to remember when all the rosy financial projections that the BoE bought into DON'T materialize? Who's going to remember that TAD property valuations were FROZEN when County-wide valuations were at historic lows? And who's going to remember all this when the BoE hits-up Gwinnett voters for more tax money between 2010-2035 to make-up for the estimated additional property tax revenues that FROZEN valuations/taxes aren't generating?

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