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Sembler statements, documents at odds on 20-year tax break

June 17 -- Statements by a Brookhaven developer appear to inflate the benefits of a proposed 20-year tax break and downplay the costs to DeKalb County taxpayers, a review of public documents shows.

The Sembler Co. is asking DeKalb for a 20-year exemption from property taxes for portions of its TOWN/Brookhaven retail and residential project on Peachtree Road. Sembler characterizes the project as a huge economic boost for DeKalb that would generate far more in taxes and fees than the exemption would cost taxpayers.

On several points, Sembler representatives’ public statements contradict information that the company has provided to the DeKalb County Development Authority. (The authority meets at 8 a.m. Thursday to discuss the tax break.)

On the jobs

Sembler president Jeff Fuqua said last week at a town hall meeting that TOWN/Brookhaven jobs would pay, on average, $40,000 a year.

Last year, when it applied for a bond issue to finance the deal, Sembler said the jobs would pay $25,000 a year. (The federal poverty level for a family of four is $22,050.) Fuqua signed the application.

On the cost to taxpayers

Fuqua told citizens last week that the tax abatement, projected to save the company $51.6 million in taxes over 20 years, is really only worth $16 million in today’s dollars.

Fuqua told the authority last month that the tax break is worth $22 million, according to meeting minutes.

On Sembler’s investment

In several forums, Sembler representatives say TOWN/Brookhaven is a $400 million investment that will eventually generate property taxes based on that value.

Last July, Sembler estimated the project’s budget at $260 million. In December, a DeKalb judge validated a $244 million bond deal to finance the project.

On the economic benefits

An economic analysis by KPMG, commissioned by Sembler, said TOWN/Brookhaven would generate $119 million in taxes and fees over the next 20 years. That revenue would be offset by $51.7 million in reduced property taxes for Sembler, leaving a net benefit to the “DeKalb community” of $67 million, based on KPMG’s calculations.

Those calculations include $51.4 million in revenue ($45.6 million in property taxes, and $5.8 million in residents’ car taxes) that DeKalb can already plan on collecting from two apartment buildings that are near completion on the Brookhaven site. Those buildings would not be covered by the proposed tax break.

KPMG’s analysis also includes $41 million in sales taxes that would be collected by MARTA, not DeKalb.

Deducting those amounts would reduce the projected revenue made possible by the tax abatement to $27 million. Figuring in the tax break, DeKalb government and schools would be roughly $25 million in the hole.

Sembler spokesman Angelo Fuster says it’s unfair to do the math that way. The developer must be given credit for property taxes to be paid on the non-exempt buildings, he said, even though they are not a part of the proposed abatement.

“It’s a benefit to the county that would not have happened,” he said. “But for this project, these two buildings would not have been built.”