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Sembler abatement deferred, Walker recuses himself
Tuesday, June 23, 2009 11:28 AM EDT


DeKalb Development Authority Chair Dr. Eugene Walker recuses himself from the vote of the Authority last Thursday, and leaves the room in an effort to remove himself from any controversy. Crier photo: Rebecca Chase Williams
By Rebecca Chase Williams
For The Crier

State Rep. Mike Jacobs’ (R-north DeKalb) “status” on his Facebook page said, “Mike Jacobs likes it when the taxpayers win, and hopes it’s not too soon to say things have changed for the better in DeKalb.”

It was his way of summing up a week of surprises and startling announcements as the DeKalb Development Authority postponed voting on the controversial $52 million, 20-year, 100 percent tax break proposed by Sembler’s Town Brookhaven project.

The 52-acre mixed-use project is located on Peachtree Road next to Oglethorpe University.

The surprises started last Wednesday when the DeKalb Board of Education filed an injunction and lawsuit to stop the Development Authority from voting on the tax break that would potentially take away future revenues from the school system. The same day, five members of the DeKalb Board of Commissioners signed a resolution saying it “opposes the proposed economic development incentives for the project at this time” and would challenge the incentives if passed without the endorsement of the commissioners. Then the DeKalb Ethics Commission notified Development Authority Chairman Dr. Eugene Walker that he was under investigation for a potential conflict of interest after accepting $18,000 in campaign contributions from Sembler Company employees.

Thursday’s crowded Development Authority meeting opened with the surprise announcement from Dr. Walker saying that “Gene Walker doesn’t need to be the focus” and so “with a heavy heart and an abundance of caution, I’m going to recuse myself.”

With that, he left the room.

The Development Authority then heard the results of the independent analysis of the proposed Sembler tax abatement performed by Dick Layton of Wachovia Bank. The analysis agreed with Sembler’s numbers that the project could potentially provide a net benefit to the county of $119 million but Layton pointed out that “abating all taxes constitute a break from traditional policy.”

Layton cautioned that the proposal, “may not require county approval, but clearly there should be intergovernmental cooperation.”

As if on cue, Development Authority director, Maria Mullins read a letter from DeKalb Chief Executive Burrell Ellis recommending that the Authority “not approve a 100 percent tax abatement inconsistent with existing policy.” Ellis asked that the county’s Department of Economic Development immediately develop an incentive policy that “takes into consideration best practices and current market conditions.”

Ellis’s memo came as a surprise to both county commissioners and those at the authority meeting.

“”My jaw dropped when I read Burrell Ellis’ memo,” said Jacobs.

County Commissioner Jeff Rader presented the resolution from the board of commissioners adding that he too “looks forward to a more fully articulated development policy.”

Authority members, who are not required to have the consent of either the board of commissioners or board of education then voted unanimously to defer any action on the Sembler proposal until a new policy could be developed.

State Rep. Mike Jacobs called it a “win for the people” and said it ended up being the public outcry that carried the day.

The lawsuit filed by the DeKalb Board of Education is still to be resolved. The injunction was not granted, but according to school board member Paul Womack, the lawsuit is moving forward with the board challenging, “the constitutionality of this body to divert funds without consulting the board of education.”

Womack said the board estimated the Sembler proposal could cost the school district $1.2 million a year, and that a majority of the school board backed DeKalb School Superintendent Crawford Lewis’s decision to file a lawsuit.

“The superintendent did the right thing for the right reason,” said Womack.

In the meantime, Sembler’s president Jeff Fuqua said the Town Brookhaven project, “will be built at some level” but that his company “will come back with a different proposal.” He added that the 10-year, partial tax break already granted by the authority is “not sufficient.”

Womack said that if Sembler asks a more lucrative deal, the board “will oppose that.”