MRC, taxpayers still wondering — What now?
November 30, 2012 12:31 AM | 2289 views | 2 2 comments | 6 6 recommendations | email to a friend | print
Reggie Taylor’s resignation last week as director of the Marietta Redevelopment Corp. to become city manager of East Point serves as a reminder of good intentions gone awry. And it leaves the MRC no closer than it has been to answering the question, “What now?”

Taylor was hired by the Marietta Council in February 2008 at $85,000 on a contract basis and had been an “at-will” employee since February 2010. His impact as MRC executive director was negligible, at best. And that description could be applied to the MRC as a whole, too.

The tax-exempt MRC was created by the Council back in 2003, patterned after a similar group that spearheaded the highly successful transformation of downtown Chattanooga. It was hoped it would help revitalize the many blighted neighborhoods and strip centers that dot Marietta. But unlike the Chattanooga group, which benefited from a $13 million start-up gift from a private donor (the local Coca-Cola bottler), the MRC had to rely on public money. The council gave it $2.1 million and the MRC in turn was able leverage that to secure a $6 million line of credit from the Bank of North Georgia.

But it has little to show for its efforts. It initially planned to redevelop a 98-acre swath of the Hedges-Gramling neighborhood just east of the Marietta Hilton Conference Center, partly with the help of $14 million in Tax Allocation District funding. Not long after it began buying properties, the economy tanked. So the MRC scaled back its plan in order to focus on a 10-acre tract in the same area, spending about $4.3 million to buy rundown houses in hopes of flipping them to a developer at some point.

Unfortunately, the Great Recession was deeper and more protracted than anyone anticipated, and the hoped-for developer has never materialized. Meanwhile, the MRC, and by extension the city and its taxpayers, have been in the unenviable position of playing “slumlord.” It is continuing to rent out most of the properties it acquired in the neighborhood, purchases made at prices much greater than they would now sell for.

Meanwhile, the MRC remains on the hook to the bank, with payments of $12,000 per month. The city wisely is expected to leave Taylor’s $85,000-a-year position unfilled. Looked at another way, that’s about seven months of bank payments.

“When you owe $4 million, you have to pay (the price of) a car a month,” Councilman Grif Chalfant told the MDJ. “That’s what happens. There’s not much else you can do except to wait for the general economy to turn around and the banks to open up to lending for small businesses.”

Were the city to pull the plug on the MRC, it likely would then be responsible for its debts. That’s not much of a solution.

So in other words, the answer to the “What now?” question is what it has been: Keep hoping something will come along. And frankly, that’s not much of a solution either.
Comments
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Watcher...
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November 30, 2012
Governments must get out of the Real Estate development business. Rarely are their results good.

Let Developers be Developers!

moliere
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December 02, 2012
Yeah, that Hoover Dam thing was a real fiasco. So was the Golden Gate Bridge. And the world's busiest airports in Atlanta, New York and Chicago? Total messes. Right? Yep. Everything the government touches turns to coal. Better off to let the guys who ran Enron, Arthur Anderson, Lehman Brothers, Goldman Sachs and Pets.com lead the way.
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