First on DM: Scott sends along a memorandum from Peggy Merriss announcing that she and the city are now recommending that the commission defer consideration of large scale annexation until 2011.

The full memorandum, which gives detailed reasons for the decision, can be read after the jump…

The purpose of this memorandum is to recommend that the City Commission defer consideration of a large-scale annexation plan for the next twenty-four months and revisit the issue in 2011. The City Commission’s interest in pursuing annexation has always been based on providing an opportunity to expand the City’s real property tax base, to manage and provide opportunities for leadership in the redevelopment of commercial properties located adjacent to or near the existing city limits, to decrease overall property taxes and to provide more efficient and effective services by taking advantage of economies of scale. The City Commission has indicated that annexation would have to support community interests including retaining a high quality of life, maintaining the small city “feel” and providing a superior school system. Given the City Commission’s interest and commitments, delaying consideration of current annexation options is recommended for the following reasons.

1. While the redevelopment of major commercial gateways adjacent to our city limits should be a high priority for the City of Decatur, most economic indicators show very little likelihood that financial markets would recover significantly enough to make redevelopment proposals feasible before 2012.

2. The incorporation of the City of Dunwoody could have a significant impact on the tax digest for DeKalb County. The City of Dunwoody began operation in December, 2008 and has two years to complete the transition to fully providing services. By waiting until 2011, any changes in the tax rate in unincorporated DeKalb County to compensate for the loss of tax revenue from the Dunwoody area will be apparent. It is quite possible that the difference between property taxes in the City of Decatur and property taxes in unincorporated DeKalb County will be diminished as DeKalb County determines how service costs will be covered when revenues have been eliminated or decreased. If the difference between the tax rate between the City of Decatur and unincorporated DeKalb is reduced, the economic argument against annexation, particularly for commercial properties, may be eliminated.

3. The most recent census data was collected in 2000. This data is now dated and does not provide a good platform for decision making. A new census will be taken in 2010 which will provide much more timely and accurate data about overall population, household size and potential students for the City Schools of Decatur. Because this data should be available in 2011, it is reasonable to wait in order to use this more timely data as a basis for decision making.

4. The City Schools of Decatur are facing many challenges, including the proposed reconfiguration of existing school attendance zones and policies to address an increase in the number of potential students whose families currently reside within the City limits. Postponing consideration of the annexation issue until 2011, gives the City Schools time to develop and implement a plan to address current school population issues and have access to more accurate census data to assess facility needs for any additional students who would be brought into the system as a result of any future annexation.

While the recommendation is to defer consideration of substantial annexation until 2011, should the City be presented with annexation opportunities within the next two years that address and support strategic objectives including increasing the property tax base, managing long-term redevelopment of properties adjacent to the existing city limits or reducing the unincorporated area between the City of Decatur and the City of Avondale Estates, then the City Commission should seriously consider those opportunities on a case by case basis. Annexations of partial parts of existing parcels where the city limits bisect a lot should be considered. However, the City Commission should not accept single or small lot annexation applications that are randomly placed in mid-block areas of adjacent streets that do not support the City’s interest in clarifying the city limits.

Annexation must be approached for long-term benefits that may not accrue to the community for ten-fifteen years. Delaying consideration at this time will likely produce an opportunity for better data collection, better tax cost/benefit analysis and better long-term outcomes.