When Good Intention Becomes a Poison Pill

Here is a genuinely strange proposition: ask CRE owners to agree to tax themselves above and beyond existing rates—and then deny them a say in how that money is spent. No board seats. No elections. Just write the check and trust the system.

This is a fatal flaw I discovered while reviewing local legislation in communities interested in forming Community Improvement Districts (CIDs). If you are unfamiliar with CIDs, they are special assessment districts that enable CRE owners to pay for public improvements through self-taxation. Think roads, parks, streetlights, bike lanes, etc.

In Georgia, CIDs are authorized under the state’s constitution and enabled under local legislation. More than 40 cities and counties have local acts. Most recognize that these additional property assessments warrant direct input from taxpayers on how funds are used. Otherwise, why would they agree to extra taxes?

In my review, three cities and counties put those decisions squarely in the hands of local government rather than property owners. Perhaps these jurisdictions didn’t realize they added a poison pill when drafting the governance component of their legislation. Perhaps they don’t understand the purpose and function of these public-private partnerships.

Whatever the reason, the result is just another municipal taxing mechanism, not a true public-private partnership.

Nuances like this are why it matters to work with people who understand complexity. Special assessment districts (regardless of the state) are not just legal instruments—they are voluntary investments by private actors. Designing these partnerships to function properly is important.