Constitutional Amendment 2 on leases has voters stumped
by Geoff Folsom
October 18, 2012 12:58 AM | 10108 views | 6 6 comments | 14 14 recommendations | email to a friend | print
MARIETTA — A proposed state constitutional amendment about multi-year leases is leaving some scratching their heads, while others say it could lead to millions in savings for the state government.

Amendment 2, located at the bottom of the Nov. 6 ballot, would allow the state government to rent property through multi-year lease agreements. Currently, the state cannot lease property from outside agencies for more than a year, forcing the state to annually renew any multi-year agreement it enters into.

If passed, the amendment would allow the state, which currently leases 1,800 properties, to save an estimated $66 million over 10 years, said Paul Melvin, spokesman for the State Properties Commission, the agency that negotiates leases for the state. The amendment would primarily apply to office space leased for government workers to work out of across the state.

“Landlords are charging us more for square footage for one year,” Melvin said. “If we were able to do multiyear leases, we could get a better rate.”

The enabling legislation for the amendment caps length of rental agreements at 20 years. Melvin said the average occupancy for the state in a particular location is 10.7 years.

While Amendment 1, the state charter schools amendment, has been hotly debated on both sides of the issue, some have heard very little about the multi-year lease amendment.

Melissa Pike, chairwoman of the Cobb Democratic Party, said she was opening her mail-in ballot recently when she got a call from a voter looking to know whether or not to support Amendment 2. Pike said she couldn’t make a recommendation because she hadn’t heard anything about the issue.

“I had no idea,” Pike said.

State Rep. David Wilkerson (D-Austell), the only member of the Cobb Legislative Delegation to vote against proposing the constitutional amendment, said he did not like the ballot language the General Assembly approved, which he said shows a bias.

On the ballot, Amendment 2 will have the preamble: “Allows the state to save taxpayer funds through multi-year real estate rental agreements.” Below, the actual ballot question reads: “Shall the Constitution of Georgia be amended so as to provide for a recommendation in the state’s operating costs by allowing the General Assembly to authorize certain state agencies to enter into multiyear rental agreements?”

“I’m a big believer that if you’re going to create the ballot language, it better not show an opinion,” Wilkerson said.

Wilkerson added that he was concerned about longer leases obligating the state to pay money well into the future, when the government can’t be certain how much money it will have available.

State Sen. Lindsey Tippins (R-west Cobb) said he feels the State Properties Commission will do a good job negotiating the leases, which would likely keep the government from having to break rental agreements and being forced to pay penalties.

“The net savings the state would project over the long term is greater than any penalties you would have to pay,” he said.

The resolution proposing the amendment passed the House of Representatives 146-14 on March 27 before passing the Senate 50-0 on March 29. Gov. Nathan Deal signed the legislation on May 3.

Melvin said his agency has surveyed 19 other states that allow multi-year leases with private landlords and found that none have experienced problems. States with AAA bond ratings, like Georgia has, have not seen their credit ratings drop.

“Its good business practice,” he said.
Comments-icon Post a Comment
Bob Bummer
October 18, 2012
I believe the state should be decreasing the number of properties it is leasing. 1800 seems like quite a bit. The driver services is in a former grocery store off Canton for example. The state knows it needs a facility to provide the service why not buy some land and build a more permanent home?
susan harris
October 18, 2012
If I can not understand an amendment on the ballot my vote is NO.
Kennesaw Resident
October 19, 2012
Same here, Susan! Although I usually vote "NO!" for amendments in general. I certainly will not vote to increase laws and regulations, when we have enough already.
November 04, 2012
I agree
Gimme a Break
October 18, 2012
Forget the Amendment. Why, with the supposed decreases in State Government, are there leases on 1,800 properties, and what are they used for?
John Galt
October 18, 2012
Could this be on the ballot to allow outside for-profit entities to lease buildings that house state charter schools?

Can't trust anything from the Gold Dome anymore.
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