Georgia senators suggest minor changes, not major reforms, for development authorities

By Dave Williams, The Moultrie Observer

ATLANTA - A state Senate study committee is recommending some new requirements for local development authorities in Georgia and members of their governing boards.

But the panel stopped short of suggesting major reforms some lawmakers and advocates for local governments had sought.

In a 24-page report, the study committee recommended the General Assembly consider legislation imposing additional training requirements for development authority board members and directors and limiting hold-over board members to serving no more than six months beyond their expired terms.

The panel also suggested the Georgia Economic Development Association establish “best practices” to guide development authorities.

“The vast majority of concerns that have been addressed by this committee could be addressed by best practices,” Sen. Max Burns, R-Sylvania, the study committee’s chairman, said last month.

About 1,300 local government authorities have sprung up across Georgia since 1995, when the legislature passed a law authorizing cities and counties to form authorities. Of those, 575 are development authorities or downtown development authorities.

Development authorities typically play an important role in attracting job-creating economic development by offering tax breaks that lure business prospects and floating bonds to help finance projects.

But generous tax incentives packages that take tax revenue away from local governments and school districts have prompted calls for the General Assembly to tighten controls over local development authorities.

In 2018, lawmakers passed a bill requiring authorities to register with the state annually and undergo financial audits.

Last year, the legislature passed a measure capping per-diem payments to directors of development authorities in counties with populations of 550,000 or more. The bill also gave the state ethics commission jurisdiction over complaints aimed at authority directors.

However, a second bill sponsored by Rep. Mary Margaret Oliver, D-Decatur, that would have given cities, counties, and school districts the right to participate in bond validation hearings failed to gain support.

During a half dozen meetings last summer and fall, Republicans on the Senate study committee showed little appetite for letting local governments and school districts in on bond validation hearings or other significant reforms to development authorities that have been scoring major successes in creating jobs.

“I just don’t want to throw out the baby with the bath water,” then-Sen. Jeff Mullis, R-Chickamauga, who left office at the end of December, said during the panel’s final meeting last month. “Georgia is the No.-1 place to do business. I don’t want anything we do to keep us from being No. 1.”

The study committee also recommended the General Assembly authorize local legislative delegations or joint county delegations to pass local laws aimed at preventing multiple development authorities from operating in the same jurisdictions.

Witnesses who testified before the committee said overlapping authorities tend to compete for business, driving up the cost of the tax incentives they offer.