The proposed city of Brookhaven would start on shaky financial ground, according to an analysis by the DeKalb County government released June 19.
The proposed city’s deficit would be $360,554, according to an analysis performed at the direction of DeKalb CEO Burrell Ellis.
A 2010 study by the University of Georgia’s Carl Vinson Institute of Government showed a $135,000 surplus for the proposed city.
“At the point that the Carl Vinson Institute study was reported, you didn’t know what the tax digest was going to be,” said Commissioner Lee May, chairman of the board’s finance committee. “It’s going to be different because the tax digest assumptions are different now.”
May said he believes the county report more accurately reflects the finances the proposed new city would be dealing with.
Voters within in the boundaries of the proposed city of Brookhaven will have to decide which analysis is more accurate, May said.
“What Brookhaven residents are going to have to determine for themselves is whether they are willing to undertake the risk of having less money than they had anticipated and the possibility of a possible tax increase after they incorporate,” May said.
Rep. Mike Jacobs, who pushed the Brookhaven referendum through the state General Assembly, said the county’s analysis does not portray the entire picture.
“The following day the county announced that there are increased Homestead Option Sales Tax (HOST) collections and every city is going to receive larger HOST proceeds,” Jacobs said.
For Brookhaven, the projected HOST revenue, which is used for government construction and infrastructure improvements, would “more than dwarf the theoretical deficit,” Jacobs said.
“The county said nothing about the positive impact that it has on the city,” Jacobs said.
According to Jacobs, the additional HOST funds would equal approximately $1.3 million.
“It’s an estimate, but there’s no question that HOST collections plus the fact that the Brookhaven residential property tax digest decreased at a lower rate than the county as a whole resulted in Brookhaven receiving a much higher amount of HOST proceeds,” Jacobs said.
Laurenthia Mesh, of Ashford Neighbors, a group formed to oppose Brookhaven’s cityhood movement, said her organization is not surprised by the county’s analysis.
“It’s what Ashford Neighbors has been saying all along,” Mesh said. “There’s not enough money to do what Rep. Mike Jacobs said about a city of Brookhaven.”
“We still stand by our claim that a city is not feasible,” Mesh said. “The proposed city…would have to cut back on the proposed services because of reduced revenues expected from 2012 property taxes.
“No business person would start any new venture, much less a city, with a deficit expected and no reserves to fall back on,” Mesh said.
Mesh said voters must remember that they will not vote on any proposed services or a budget in July.
“It is the charter we vote on July 31—not promises or propaganda,” Mesh said.