Annexation Series: Does the Plan Add Up for the City?

Updated Oct. 18, 2011

This is part of Norcross Patch’s five-part series about the potential annexation of an area roughly along Mitchell Road up to I-85 into the City of Norcross, "rounding off" the borders of the city limits. We'll re-run the series this week, in preparation for the Nov. 8 vote. We've already looked at code enforcement. In later days we'll cover the bottom line for home owners, the long-term vision and crime. 

If you want to boil an issue down, conventional wisdom tells you to follow the numbers.

According to the city fiscal analysis of the proposed annexation, the total cost of servicing the area in the first year, including public works, community development and police service is $824,132, a number that includes a 10 percent contingency.

On the other side of the balance sheet, the city estimates collecting $846,569 in year one in revenue, including property tax, storm water fees, business licenses, alcohol licenses and insurance premium taxes. According to the calculations, the City of Norcross would actually come out on top by $22,437, or the balance of those two numbers, if the annexation measure passes at the Nov. 8 vote.  

The second and third years the city would see some red, according to the figures, losing about $23,000 each year. Community Development Director Chris McCrary, who spent six to eight months putting these figures together, said he pushed some storm water and street projects back a few years, causing the numbers to dip into the negative in years two and three.

He said he feels confident, overall, about the solidity of the figures. “I have a feeling my number are actually low,” said McCrary, particularly for the alcohol license figure.

In 2011, the City of Norcross needed to  in order to keep the budget balanced without raising the millage rate for residents. 

The number of residential parcels in the area being considered is 1,177 while the number of commercial parcels in the area is 64. The cost for maintaining residential parcels is higher than commercial, but city officials say the “balance” of these two numbers is not a concern in this case.

“Planners use general rules of thumb but we’re taking the actual tax digest,” says Norcross Mayor Bucky Johnson. He says that they know exactly what they’ve got, and feel confident that the annexation will be revenue neutral.

For many officials and residents, the annexation issue isn’t about short-term budgets but long-range vision: Having control of the future of the city. So even if it did cost some money up front it would be worth it by some logic. 

McCrary could see the eventuality of an across-the-board cost that just isn’t factored into the plan, like a continued crash of the housing market that would take a chunk out of property tax revenue.  “I’d still support it,” said McCrary. “As a planner, there’s a certain amount of investment you have to make.”

Norcross resident Ranae Heaven supports the annexation—even though she thinks it will cost the city residents money. “It’s not going to be revenue neutral but it’s an investment I’m willing to make,” she said. She thinks that eventually her property value will get a boost from the annexation.