Mayor Keisha Lance Bottoms Presents Amended Gulch Agreement to City Council
Wednesday, October 24th, 2018
Mayor Keisha Lance Bottoms has negotiated significantly new terms with the CIM Group to redevelop the currently underdeveloped Gulch property in the heart of downtown Atlanta. As part of the new agreement, the maximum authorized TAD bond amount has been reduced from $625 million to $40 million. If approved, the agreement would result in the transformation of 40 acres of underutilized land into office, residential and retail space and add new infrastructure, roads, sidewalks and city parks to downtown Atlanta.
“Our team has worked nonstop over the last several months to structure a deal that would not just bring much needed development to the westside of downtown, but most importantly, would benefit communities throughout Atlanta,” said Mayor Bottoms. “With the inclusion of millions of dollars towards affordable and workforce housing, economic development, and job training, this historic agreement is vastly different than any other negotiated by our City.”
The new plan, which has been presented to the Atlanta City Council for their review includes a number of redefined terms which place more financial responsibility on the developer while still preserving over $150 million in previously non-existent public purposes initiatives focused on affordable housing, safety and economic development.
Terms in the agreement shared with Council today include:
CIM assuming all financial risk including all design and construction expenses and serving as the sole purchaser of the new TAD bonds
CIM paying taxes in full, only receiving the benefit of TAD supplemental payments as reimbursements once compliance on obligations and expenses has been independently verified. For qualified expenses, Invest Atlanta will make reimbursement payments to CIM for up to 12.5% of total project costs or through 2038, whichever occurs first
Reducing TAD bond proceeds available to CIM from $500 million to $32 million, with up to $8 million in bond proceeds available to Empowerment Zone Communities
Currently, there are almost no property tax dollars generated within the 40-acre Gulch. After the proposed development, the area is projected to generate approximately $21 million to $35 million in property tax annually. The planned development will not only expand the city’s tax base but also deliver tens of millions in significant investments related to affordability, equity, and opportunity.
Specifically, the community benefits negotiated by Mayor Bottoms in the original agreement remain in place, in full, and include:
$28 million investment into a citywide affordable housing fund
Required minimum affordable housing residential units of 200 or 20%, whichever is greater
$2 million commitment for workforce training
$12 million investment into a citywide economic development fund
Commitment to historic levels of minority and female owned businesses with a goal of at least 38% utilization and an offer of 10% equity
$12 million commitment towards the construction of a new seven-bay fire station