Other than the word crisis, the most-often used word in politics is transformative. We’ve been transforming things for generations. We move from one transformation to the next. Now, the property owners in Augusta are offered the opportunity to transform their wallets by paying higher taxes. Higher by how much? No one has said, although no one has stepped forward to say the cost will be “zero,” as in Washington-speak.
We reach this moment of transformation with the plans for a new James Brown Arena. A true palace, you might say, in comparison to the last transformative moment on the property a half century ago.
In order to seize the present moment, property taxpayers will have to pay back $240 million in bonds over the next 30 years, plus another $21 million dollars in interest. That’s $261 million dollars.
They say our property taxes will be raised for the next 30 years at the rate of about $100 for every $100,000 in value. So, if your home is worth $250,000, then your share of the new arena is actually $7,500. But, not really, because property regularly increases in value. In the end, you will actually pay thousands more. Now, that’s pretty transformative.
Not just for homeowners, but property taxes on everyone who has made an investment in land in Augusta will see their taxes go up, including businesses. Of course the businessman will simply pass his increased costs on to their customers. But, with inflation what it is today, who will really notice?
The people who pay the freight for the bonds will not be the only people voting on it. Since this is a popular vote, every registered voter will have a say whether your property taxes should be increased. Yes, those with no skin in the game will tell you how to spend your money. But, that’s what it takes to be transformative, I guess.
Quite actually, this is just part of the story. The general obligation bonds put a $261 million price tag on the arena, but that is not the top line. Also, in the project are $25 million in SPLOST funds, so now we are talking about $286 million dollars. But, wait! There’s more. Since the people building the arena could not wait to get their SPLOST funds, they’ve issued bonds to get the money up front. This adds another few million in interest to the cost.
I guess what has me most concerned is that we haven’t had the best transparency on the true cost of the new James Brown Arena. I would hope that other people will join me in asking some basic questions. For example:
- What is the true, total cost to the individual property owner of the $235 million bond issue?
- Is it expected that the GO bonds will be refinanced at some point and payment schedules extended?
- What will the taxpayers be expected to put up each year for operation subsidies?
- What are the other sources and amounts of tax money earmarked for the area?
- Will the Bell Auditorium renovation fee continue to be collected?
- What other sources of construction funds were explored and why was each discounted?
- What specific economic development will be attracted to the new arena environs?
The people behind this project are honorable and well-intended. I don’t doubt their sincerity one bit. But, my money is my money, and I need to know a lot more before I agree to pay for another transformative moment.
Sincerely,
Bob Young
