As Augusta continues to rent office space for city departments, it is paying the highest rent per square foot for a building in a blighted area that is owned by an organization behind on its taxes.
The Augusta Neighborhood Improvement Corp. has been a city landlord since before the organization built the ANIC Building at 925 Laney-Walker Blvd., using part of a $20 million grant to revitalize the area.
The city agreed in February 2003 to lease space for two government offices – Augusta Fire Department administration and Housing and Community Development – before the structure was complete, waived $112,000 in penalties when it was late opening, then spent $94,000 to run fiber optic cable between the municipal building and the ANIC building, according to previous reports in The Augusta Chronicle.
The idea then was to infuse the blighted, historically black commercial corridor with activity, in hopes of spurring development.
“We were getting, hopefully, growth and development in the Laney-Walker corridor that will help it stand on its own two feet,” Andy Cheek, a former Augusta Commission member who advocated the move, said recently.
ANIC will collect a total of $176,840 in rent this year to house the tax commissioner’s eastside tag office and Housing and Community Development, according to city financial records.
ANIC, however, is behind on its property tax bills. Tax records show the organization, whose stated purpose is promoting tourism, economic development and housing, hasn’t paid last year’s taxes, except for solid-waste charges, on 127 properties, amounting to $23,880.33.
Tax Commissioner Steven Kendrick and Housing and Community Development Director Chester Wheeler said their offices’ leases and rents were negotiated before either took office.
“It is a bit ironic” that ANIC is late, along with thousands of others, on its tax bills, Kendrick said, but that can’t be used as a reason to withhold the rent. He said the ANIC building was a vast improvement over the former tag office location near the Georgia farmer’s market.
The $96,840 in rent Housing and Community Development paid to ANIC this year, most of it a redirection of federal taxpayer money as grant administration charges, amounts to $18.17 a foot for 5,330 square feet, the most Augusta pays for any leased office space.
A 2008 10-year lease agreement between ANIC and the tag office set annual rent at $76,725 for 4,650 square feet, with an annual 3 percent increase. Today, that amounts to $17.20 a square foot.
ANIC Executive Director Robert Cooks defended the program he has overseen since its inception, saying the rents were set based on building size and quality and are well worth the traffic they bring to the area.
“This was a corridor that people were told to drive around, not come to,” Cooks said. “People from Augusta can now see that downtown is not this dinosaur. They can see all the changes taking place.”
City Administrator Fred Russell, who served as deputy administrator in 2003, also didn’t view the more than
$1 million in rent paid ANIC over the years as excessive, even as the city contemplates buying the building from ANIC to house the Augusta Utilities Department.
“You’ve got to look at the intrinsic value to Laney-Walker,” he said.
City leaders who pushed the move in 2003 never anticipated that the rental arrangement would last so long or that it would have such limited impact, however.
“I would have liked to have seen it move faster,” Cheek said.