Multiyear Corruption?

Most Georgians know that an amendment relating to charter schools will be on their ballot on November.  But few know that there is a second amendment up for consideration that, if approved, could save the state millions of dollars by allowing multiyear lease agreements.

The Like the Dew community is divided on this amendment and we would prefer not to run this piece unless we can pair it with one that presents the arguments against the amendment.

The article tells us only this: “Though he acknowledged that multiyear leases could be abused, Alan Essig, Executive Director of the Georgia Budget and Policy Institute, said there is a definite argument to be made for the amendment.” Don’t our readers deserve to hear about those potential abuses that are given such short shrift here? Considering all the cronyism and the absence of ethics governing Georgia politicians, don’t our readers deserve to read an argument against allowing the current crop of Georgia politicians whom may well lock us into leases for as many as 20 years? We invite your arguments.

Over the next ten years, the amendment would save the state $66 million, according to Paul Melvin, who is the director of communications for Georgia’s State Properties Commission.

State agencies such as the Georgia Department of Public Health, the Division of Child Support Services, or the Georgia Environmental Protection Division could get better rates on long-term leases for offices around the state.

Property owners leasing to these agencies would also be more willing to make improvements to leased properties, according to state Sen. Buddy Carter, who sponsored the resolution proposing the amendment.

Nothing in Georgia’s Constitution specifically addresses multiyear leases, according to Melvin.  They’re effectively forbidden, however, by the requirement that an existing legislature not put debt on a future legislature.

Other states already lease property for more than a year.  “We surveyed 19 states and out of those 19 states, 18 out of 19 states used a multiyear lease,” Melvin said.

If adopted, the amendment would allow state agencies that fall under the State Properties Commission, the Board of Regents of the University System of Georgia, and the Georgia Department of Labor to sign longer leases.  Leases by cities and counties would not be affected.

Leasing requirements would change for the University of Georgia.  Currently, UGA uses their foundation to lease teaching space for the Terry College of Business in Atlanta and for UGA’s Gwinnett campus.  Then, UGA leases the space from the foundation one year at a time.

“We would be able to cut that middle man out,” said James Dorsey, UGA’s director of the Office of Real Estate and Space Management.

The resolution was adopted with a unanimous vote in the Georgia Senate during the 2011 legislative session.  State Rep. Jay Neal, who sponsored the resolution in the Georgia House of Representatives, said the resolution was not adopted in the House because time ran out in 2011.

During the 2012 session, the House approved the resolution, along with another bill that placed parameters on multiyear leases.  The parameters restrict multiyear leases to 20 years and allow the Georgia State Financing and Investment Commission to set a yearly limit on the total value of multiyear leases.

Though he acknowledged that multiyear leases could be abused, Alan Essig, Executive Director of the Georgia Budget and Policy Institute, said there is a definite argument to be made for the amendment.

“If we want the state to run more like a business, if we want them to be efficient, these are the kinds of tools the state doesn’t have that they need to have,” Essig said.

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Editor's Note: In reviewing this story, some Dewers disagreed  with the author's position on this issue
Julianne Wyrick

Julianne Wyrick

Julianne Wyrick is currently a Health and Medical journalism graduate student at the University of Georgia. She has a B.A. in biochemistry from Asbury University and served as the senior news writer for Asbury's newspaper. She has also worked as a science-writing intern for Alltech, a global animal health and nutrition company.

4 Comments
  1. Dewers, this appears to be a well-reported news story. Not an op-ed that requires rebuttal. Your sidebar strikes me as strange.

    1. Lee Leslie

      It was strange. Strange that we had a story that we disagreed and for reason I won’t go into, didn’t have a chance to write a rebuttal – the sidebar, while odd, we felt was needed to point out that this issue was not so cut and dried. Frankly, we felt there was good reason to vote against all of the Georgia ballot issues

  2. I began writing this story with
    journalistic cynicism, thinking that there might be negative effects of the
    proposed amendment that should be exposed.
    However, in my research I was able to find no evidence to back up this
    claim. I first called several House
    members who voted against the bill for comment but did not receive any
    replies.

    I then turned to independent
    entities in Georgia focusing on policy analysis. At the time, Georgia Public Policy Foundation
    had not yet researched the bill and could not provide a position. (More recently, Benita Dodd, the vice
    president of this organization, published an article on their website http://www.georgiapolicy.org/state-property-leases-could-get-a-new-lease-on-life/). The League of Women Voters also did not have
    a position on the amendment.

    Although the Georgia Budget and
    Policy Institute did not have an official stance, Executive Director Alan Essig
    did give me his thoughts on the amendment.
    In acknowledging the potential for abuse Essig stated, “If you do a
    multiyear lease, you’re basically committing a state agency to an expense that
    the General Assembly hasn’t appropriated money for yet, so you’re kind of
    taking the decision making out of future general assemblies, future governors
    because you locked yourself in.”

    He then explained that multiyear
    leases are an accepted business practice in the private sector and could
    potentially save the state money over time.
    Essig said that multiyear leases just needed to have some oversight to
    make sure there was no abuse. In
    clarifying the term “oversight,” Essig explained that he was referring to the
    normal oversight responsibilities of the legislative budget process and the
    executive budget process. He said in any
    contract the state has, it is up to the General Assembly, the state agencies,
    and the Governor to make sure the proper oversight is there and the right
    questions are asked.

    “The rationale for tying the
    state’s hand is more of an oversight role and that is something that is
    incumbent in the general assembly to do in all contracts they have,” Essig said. Rather than include all of my conversation
    with Essig in my article, I simply included his final opinion on the amendment,
    in which the pros outweighed the cons.

    Despite my initial journalistic
    cynicism, I found no one, independent or government-related, with state policy
    expertise who cited evidence as to why the amendment would be a poor choice for
    voters. However, if such evidence
    exists, I would welcome seeing it.

    1. Lee Leslie

      Julianne – now you have found someone who is cynical enough. Many of those in power are either in the same party or the same club – of course, they will support this bill. In fact, I think it makes great sense as it can save money except for real life practice – just as one party might stack the court or a committee with appointees whose terms will last beyond the next session preventing an opposing party, should they come into power, from appointing anyone. I suspect that the party in power will do the same with leases where they will sign long leases to their politically connected cronies preventing any future party from making changes. I voted against it. If you think that you can trust our one party state to do what is right and good for you, than cancel my vote with yours. Thank you for presenting this issue to the Dew readers, for the well consider evidence and for standing up for what you believe. I hope we will see more stories from you.

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