No one ever expected the $40 million renovation of the Augusta’s Municipal Building would be so controversial.
Last year, the Augusta Commission was doing a dance to avoid officially naming a portion of the downtown area a “slum,” but still legally establishing an Urban Redevelopment Area that would allow the city to borrow approximately $28.5 million in tax-exempt bonds to renovate the Marble Palace on Greene Street.
After weeks of debates, the commission managed to develop an Urban Redevelopment Area under the Department of Community Affairs with plans to issue the bonds, which were expected to save the city approximately $2 million during the life of the bonds.
But the city recently hit a snag.
The newly appointed members of the city’s Urban Redevelopment Agency temporarily put the brakes on issuing the bonds last week after learning the city would be responsible for the debt service on the bonds if Augusta voters decide to reject the proposed $194 million Special Purpose Local Option Sales (SPLOST) list during the upcoming May 20 election.
The commission intended to pay off the bonds’ debt service with the next phase of SPLOST.
If the SPLOST doesn’t pass, which is a growing concern for the city considering the number of commissioners and mayoral candidates criticizing the $194 million list, the city will be forced to find an alternative funding source to pay off the bonds.
“We are in a world of hurt, especially if it doesn’t pass,” Augusta Commissioner Alvin Mason said, referring to the SPLOST list. However, Mason has been extremely critical of the SPLOST list and suspects that the list will not be approved in May.
Augusta’s Finance Director Donna Williams said the commission could be forced to turn to the city’s capital outlay fund to help cover the costs if the SPLOST list is not approved on May 20.
Williams explained that the capital outlay fund currently generates approximately $4 million a year; however, those funds are typically used to make unanticipated repairs to county buildings, pay for the unscheduled replacement of vehicles in the sheriff’s department and replace computer equipment.
“That is barely enough to cover our necessities throughout the year,” Williams said, referring to the capital outlay fund.
Williams reminded commissioners that in 2011, the city used approximately $2.5 million in that fund to balance operations and the county’s capital projects took a major hit.
“We didn’t replace anything and we didn’t repair anything,” she said, adding that the consequences were expensive in later years. “It’s the old saying, ‘You are going to pay for it now or you are going to really pay for it later.’”
Augusta Commissioner Donnie Smith said that each year the county continues to dig itself into a deeper hole.
“The previous commission set a budget that was $4 million over when we came into office in 2013,” Smith said. “That left us with a hole of $4 million. Then, this year, it is expected that we will wind up with a $4 million hole.”
Smith said when the commission begins working on the 2015 budget, it is anticipated that it will face a $7.5 million deficit.
Facing the possibility of the SPLOST not passing, Smith suggested that commissioners should consider downsizing the municipal building’s renovation by not including the Information Technology building, which is currently housed in a 19th Century court building facing Telfair Street.
But Smith said he has been informed that commissioners couldn’t alter the construction project as approved.
“I can’t understand how we are the policymakers for this government and we can’t decide that we want to cut $9 million out of a project,” Smith said, referring to the IT building. “Now, somebody tell me how that is right. If we want to cut out the IT building to save these taxpayers money, somebody tell me how that can’t be done because we are the ones making rules. These 10 people sitting right here. I’m waiting on an answer from somebody.”
No one from the city government approached the podium to answer Smith’s question.
“We are the governing body. Somebody stand up here and somebody tell me why we can’t do that,” Smith said, as he began pounding on the table next to his microphone.
“You mean to tell me we pay all the people in this government, there are 2,700 people in this government, and nobody can answer that question for me?”
Augusta Mayor Deke Copenhaver quickly asked Smith to calm down by saying, “Donnie, please.”
The city’s General Counsel Andrew MacKenzie explained that once action has already been taken on a commission’s vote, it makes it much more difficult to rescind or change course.
As the discussion continued, Copenhaver insisted there wasn’t anyone on the commission that wanted to shelve the project.
Mayor Pro Tem Corey Johnson agreed, saying that the commission needs to stand by its decision last year to approve the renovations of the municipal building and fund it with the means necessary if SPLOST is not approved.
“At this point, we just need to move forward,” Johnson said. “The bottom line of it is, if (SPLOST) passes in May, it passes. If it doesn’t, we pretty much already said this was the other alternative to fund it regardless. If we didn’t want to do it, we should have denied this project back then.”
Copenhaver asked the commission to take a non-binding straw poll to see if there was enough support for the Urban Redevelopment Agency to issue the bonds.
Commissioners Grady Smith, Mary Davis, Joe Jackson, Corey Johnson and Bill Fennoy gradually raised their hands. Copenhaver also raised his hand in support.
“So there is six in favor,” Copenhaver said.
Augusta Commissioner Bill Lockett immediately questioned the vote.
“How did you get six?” Lockett asked. “You can’t vote.”
Copenhaver quickly corrected the commissioner.
“I can in a straw poll, my friend,” Copenhaver said.
“Lord, have mercy,” Lockett replied.
Immediately after the meeting, members of the Urban Redevelopment Agency unanimously voted to issue the $28.5 million revenue bond.
“We are not the overseers of the project or the commission. We are simply the approving agency of the bonds,” said URA member Terry Elam. “It is not our job to decide whether the bond is worthy or not. The commissioners are ultimately responsible.”