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Community Improvement Districts and Municipal Law

City and County Government Representation

Since 1996, with the conclusion of a major zoning issue in DeKalb County, this firm has represented community organizations, neighborhood associations, and nonprofit civic organizations as they interface with county and municipal governments. We have experience in zoning, permitting, code enforcement, ordinance amendments, variances, local taxation, and other aspects of local governments' land use and zoning project development.

Our experience in presenting matters before zoning boards and governing authorities and dealing with administrative permitting processes helps the landowner and land developer streamline the development process from concept to completion. Located in the city of Tucker, we have good familiarity with the people and legal processes of the city of Tucker and the county of DeKalb. To find out more, call us at 770-938-1770.

Charlton Allen & Associates has experience in the creation, implementation, governance, and litigation regarding Community Improvement District (CID.) We have worked with the Georgia General Assembly on legislation important to CIDs. We represent CIDs in DeKalb, Fulton, and Gwinnett Counties, and interface with county and municipal governments on behalf of the CIDs.

I. Constitutional Basis

II. Purposes

III. Local Legislation

IV. Creation

Adoption of Resolution

Written Consent

V. Administration

VI. Taxes

VII. Existing CIDs

Constitutional Basis

All Community Improvement Districts (CIDs) in Georgia are founded pursuant to Article IX, Section VII of the Georgia Constitution. The constitutional amendment allowing this type entity was approved by the voters in 1984.

Purposes

A CID may be created for one or more of the following governmental services and facilities:

Street and road construction and maintenance, including curbs, sidewalks, street lights, and devices to control the flow of traffic on streets and roads.
Parks and recreational areas and facilities.
Storm water and sewage collection and disposal systems.
Development, storage, treatment, purification and distribution of water.
Public transportation.
Terminal and dock facilities and parking facilities.
Such other services and facilities as may be provided for by general law.

Local Legislation

Although the Constitution allows for CIDs, there must be local legislation passed by the Georgia General Assembly permitting CIDs within a specified county or municipality, or both. The first CID Act, the Cobb County Community Improvement Districts Act, was approved by the General Assembly in 1985. Without local legislation, no CID may be established within a political subdivision of this state.

Creation

CIDs are actually created through the enactment by a local government(s) of a resolution, coupled with the consent of the property owners. The first Georgia CID, the Cumberland CID, was created in 1988. The Georgia Constitution, Article IX, Section VII, Paragraph III(b), sets forth the following conditions precedent to the creation of a CID:

The adoption of a resolution consenting to the creation of the community improvement district by:
The governing authority of the county if the community improvement district is located wholly within the unincorporated area of a county;
The governing authority of the municipality if the community improvement district is located wholly within the incorporated area of a municipality; or
The governing authorities of the county and the municipality if the community improvement district is located partially within the unincorporated area of a county and partially within the incorporated area of a municipality; and
Written consent to the creation of the community improvement district by:
A majority of the owners of real property within the community improvement district which will be subject to taxes, fees and assessments levied by the administrative body of the community improvement district; and
The owners of real property within the community improvement district which constitutes at least 75 percent by value of all real property within the community improvement district which will be subject to taxes, fees, and assessments levied by the administrative body of the community improvement district; and for this purpose value shall be determined by the most recent approved county ad valorem tax digest.

It is important to note here that owners of real property used residentially are not included in the aforementioned calculations. Residential properties may be included within the geographical boundaries of a CID, but don’t count for or against the percentages needed for the formation of a CID, aren’t taxed by the CID, and aren’t eligible to participate in CID governance, such as in the election of Board members.

As a practical matter, the impetus for creating CIDs comes from commercial property owners, not local government. Property owners may feel as if their area’s governmental infrastructure or services are being sufficiently funded, and may seek to invest extra taxes to cause it to happen. These private property interests typically have organized committees, hired legal counsel and administrators, and solicited the requisite number of consents from their fellow commercial property owners.

A threshold question in whether to go to the effort of soliciting the written consent of property owners to form a CID is directly related to the projected revenue to be generated by a CID tax. Will it be enough to pay for administrative expenses and fund meaningful infrastructure and service improvements desired by the property owners?

The actual geographical area which defines a CID has likewise typically been determined by the organizers. A target area is identified and commercial property owners are asked to sign consent forms agreeing to their inclusion within the district. As a critical mass is reached, the district shape is molded so that the consent of a majority of the owners representing at least 75% of the property value is achieved.

The next step is certification by the County Tax Commissioner that the percentages of approval have been reached. Next, the County Board of Commissioners and/or City Council must pass a resolution consenting to the creation of the district.

Administration

A CID is administered by a Board of Directors. The make-up of the Board is set forth in the local legislation allowing for CIDs within a jurisdiction. There are elected board members, and appointed board members, in each district. The number of each varies as illustrated below:

Cobb & Gwinnett County:

6 elected by property owners 1 appointed by County 1 appointed by each municipality in the district

Fulton County:

5 elected by property owners 2 appointed by County 1 appointed by each municipality in the district

Atlanta:

6 elected by property owners 1 appointed by Mayor 1 appointed by Council President 1 serves by virtue of being chair of City Council Finance Committee

DeKalb County:

5 elected by property owners 2 appointed by County Some board members are elected on ballots weighted by value of property interests, and some based upon one vote per owner, regardless of value. Terms of office are also set by the legislation and the resolution creating the CID.

Taxes

The CID Board of Directors raises funds by setting an ad valorem millage rate on real property, specifically excluding property used residentially. The constitutional upper limit is 2 ½ percent of the assessed value (which is 25 mills), but at least one local CID Act (Cobb County) has placed the ceiling at 5 mills. The millage rate is placed upon the regular tax bills sent by the Tax Commissioner, who transmits the collected taxes to the CID Board to expend in accordance with the purposes of the District.

Existing Cids

Almost all CIDs in existence are in the Atlanta area, although they may be created in other jurisdictions of the State if the local delegations pass local CID Acts in the General Assembly. Those created include: