Court Opinion

ID: 5123939
Source: CourtListenerOpinion
Date Created: 2021-11-08 08:06:38.618081+00
Date Added: 2024-06-11T08:22:37.099619
License: Public Domain

FIRST DIVISION
                              BARNES, P. J.,
                           GOBEIL and MILLER, P.J.

                   NOTICE: Motions for reconsideration must be
                   physically received in our clerk’s office within ten
                   days of the date of decision to be deemed timely filed.
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                   DEADLINES ARE NO LONGER TOLLED IN THIS
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                   THE TIMES SET BY OUR COURT RULES.

                                                                   October 27, 2021

In the Court of Appeals of Georgia
 A21A1143, A21A1144, A21A1145, A21A1146. BENE v. STATE
     OF GEORGIA et al. (four cases)

      GOBEIL, Judge.

      In these related appeals, the State brought bond validation petitions seeking a

judgment confirming and validating the Fulton County Development Authority’s (the

“Authority”) (the State and the Authority are collectively referred to as the

“appellees”) issuance of proposed taxable revenue bonds and related security

intended to finance four development projects in Fulton County. Julian Bene, a Fulton

County resident, intervened in the proceedings and filed objections. The superior

court subsequently entered orders validating and confirming the bonds and bond
security, and Bene appeals. For the reasons explained more fully below, we affirm the

superior court’s orders validating the bonds.

      The bonds at issue in these appeals relate to the following four economic

development projects in and around Atlanta, Fulton County: (1) $85.5 million to fund

the construction of a hotel complex with a retail component located in Atlantic

Station (Case No. A21A1143); (2) $55 million to fund the construction of a mixed

use commercial development located at 1246 Allene Avenue, Atlanta (Case No.

A21A1144); (3) $78 million to fund the construction of a multifamily housing facility

and economic development project located in Fulton County (Case No. A21A1145);

and (4) $115 million to fund the construction of a mixed use (office and retail)

development located at Northside Drive and Ethel Street, Atlanta (Case No.

A21A1146).1

      The transactions share a common structure, and this structure is relevant to the

issues on appeal. Specifically, the petitions sought to create a bond transaction

leasehold estate, where, in consideration for the issuance of the bonds, the Companies

agree to transfer fee simple title in the projects to the Authority, and the Authority and

      1
        For purposes of this opinion, the term “Company” or “Companies” will be
used to denote any of the four private companies involved in the respective bond
projects. The projects will be referred to as “project” or “projects.”

                                            2
the Companies agree to execute a lease agreement under which the Companies would

have the right to possession of the respective projects for a term of ten years. During

the term of the lease, the Authority’s interest in the projects will be exempt from ad

valorem taxation; only the Companies’ leasehold interest is subject to taxation. In

connection with the transactions, the Authority and the Companies executed

“Memoranda of Agreement” (“MOA”) establishing the valuation methodology to be

used in assessing ad valorem taxes on the leasehold estates. The percentage of value

for each year for taxation purposes is set forth in the MOAs, starting at 50 percent of

the fair market value in the first year after completion of the construction and ramping

up to 95 percent of the fair market value in the tenth year following construction. At

the conclusion of the lease term, the Companies would have the right to purchase the

projects for nominal consideration of $10 pursuant to the terms of the lease

agreement.

      After Bene intervened in the proceedings and filed objections, the superior

court conducted a hearing and subsequently entered orders validating and confirming

the bonds and bond security as required by the Development Authorities Law (OCGA

§ 36-62-1 et seq.).2 Specifically, in its comprehensive orders, the superior court

      2
          The superior court held one hearing as to all four cases.

                                            3
concluded that (1) the projects are “sufficiently definite and concrete;” (2) the

Authority may operate within the City of Atlanta, and the City’s municipal charter is

not a bar to the Authority’s operation there; (3) the bonds are not subject to the

Redevelopment Powers Law (OCGA § 36-44-1 et seq.); (4) the methodology the

Authority used to value the leasehold estates is proper; (5) the MOAs do not restrict

the Fulton County Board of Assessors’(the “Board”) discretion in valuing taxable

assets; (6) the Board derives consideration from the MOAs; (7) the MOAs do not

violate the Taxation Limitation Clause of the Georgia Constitution (Art. VII, Sec. I,

Par. I) and is not barred by the Georgia Constitution’s Intergovernmental Contracts

Clause (Art. IX, Sect. III, Par. I (a)); (8) the structure of the bond transaction does not

violate OCGA § 36-62-8 (b) (listing permissible purposes for bond proceeds,

including “for the ultimate purpose of paying, directly or indirectly . . . all or part of

the cost of any project . . . .”); (9) the leasehold’s value is not affected by the lease

termination provision; (10) the Board’s use of a 50 percent “[r]amp-[u]p”

methodology to arrive at the annual fair market value of the Companies’ leasehold

interests is proper; and (11) the bond transactions do not violate the Georgia

                                            4
Constitution’s Gratuities Clause (Art. III, Sec. VI, Par VI (a) (1)).3 The superior court

also rejected Bene’s arguments that the bond transactions involve political questions

best left to the political branches; and the transactions are “sham[s],” and their only

purpose is to provide tax breaks to private companies. These appeals followed.

      Because the parties agree that the underlying facts are not in dispute, we

“conduct[ ] a de novo review of the record in determining whether the [superior] court

committed plain legal error.” Sherman v. Dev. Auth. of Fulton County, 317 Ga. App.

345, 346 (730 SE2d 113) (2012) (“Sherman I”) (citation and punctuation omitted).

      Bene raises the same or similar arguments in each appeal, as set forth below.

      1. In related arguments, Bene argues that the superior court erred in validating

the bonds because the appellees failed to comply with OCGA § 36-82-75. As further

described below, we find no reversible error.

      First, Bene contends the appellees failed to comply with OCGA § 36-82-75,

which requires the bond validation petitions to state “for what purpose the bonds are

      3
        Because the project at issue in Case No. A21A1143 is a hotel, the superior
court included the additional finding that the project is tax-exempt as to the
Authority. See OCGA § 36-62-2 (6) (H) (vi). The superior court’s order in Case No.
A21A1146 included the additional finding that the office project at issue in that case
“meets the definition of ‘project’ found in OCGA § 36-62-2 (6) (N),” and the
Authority’s “interest in the [p]roject is tax-exempt under [the Development
Authorities Law].”

                                           5
to be issued.” Though the petitions, bond resolutions, and lease agreements allege that

the purpose of the bonds is to provide financing for the projects, Bene argues that the

appellees failed to prove that the purpose of the bonds was as stated in the petition.

Further, he claims that the purpose of the bonds in fact differs from what was stated

in the petition.

       More specifically, Bene asserts that his denial of the allegations concerning the

bonds’ purpose placed the burden on the appellees to come forward with evidence

sufficient to establish a prima facie case that the purpose of the bonds was as stated

in the petitions. He takes issue with the superior court’s ultimate finding that the

proceeds of the bonds will be used to finance the projects, arguing that there was no

evidence presented to support such a finding. In addition to the appellees’ alleged

failure to come forward with this evidence, (which Bene claims is sufficient, standing

alone, to warrant reversal of the validation orders), he further asserts that testimony

from Al Nash, the Authority’s Executive Director, expressly demonstrates that the

bonds will not actually finance the projects. Instead, the Company will pay for the

projects via separate loans from third-party lenders. Additionally, Bene cites the

Authority’s trial brief and statements during oral argument wherein it affirmed that

the purpose of the bond transaction is to provide a tax break for the Company.

                                           6
      Turning to the record before us, we find sufficient evidence of lawful purpose

to support the superior court’s bond validation orders. Again, OCGA § 36-82-75

provides in relevant part that the petition shall set forth “for what purpose the bonds

are to be issued . . . .” Each of the petitions include their stated purpose, in similarly

worded language. Specifically, in Case No. A21A1143, the petition notes that the

bond proceeds will be “used to finance a portion of the costs of acquisition,

construction, equipping and installation of land, improvements and related building

fixtures and building equipment . . .” for use as “a mixed-use commercial

development and an economic development project under OCGA § 36-62-2 (6) (N)

. . . .” The petition goes on to allege that, as determined in the resolution authorizing

the bonds,

      the issuance of the Bonds to acquire the Project and the leasing thereof
      to the Company will be in the public interest of the inhabitants of the
      County and of the State, . . . the Project and the use thereof will further
      the public purposes of the [Development Authorities Law] for which the
      [Authority] was created, and . . . the Project and the Bonds will be
      sound, feasible, and reasonable.

At the hearing, the superior court heard evidence that the bonds will serve the public

interest as set forth in the petition. Specifically, there was evidence that the issuance

                                            7
of the bonds will improve the community, provide jobs, attract other developments,

pay for improvements to old infrastructure (including decaying sewer and water

lines), cleanup of a public health hazard and an environmental site, and create

affordable housing. Thus, there is evidence that the “proposal to issue bonds is sound,

feasible, and reasonable,” and given the “any evidence” standard, the superior court’s

“findings about soundness, feasibility, and reasonableness must be sustained on

appeal[.]” Savage v. State, 297 Ga. 627, 631-632 (3) (774 SE2d 624) (2015).

      Despite the evidence of authorized purpose, Bene suggests that we nonetheless

must vacate the validation orders because the purpose alleged in the petition was not

the same as that proven at the hearing. However, he cites no authority for this

proposition. And, as further discussed below, we are not persuaded that his

contention, even assuming true, demands that we vacate the validations orders given

the petition as a whole and the facts of this case – supporting the authorized purpose

of the bonds and substantial compliance with OCGA § 36-82-75.

      The appellees, while conceding that the language in the petitions may be

“imprecise” in certain allegations, counter that Bene misunderstands OCGA § 36-82-

75’s requirement that the petition set forth the purpose of the bonds, and, in any

                                          8
event, the petitions actually allege the true purpose of the bonds, and that they will

ultimately be used to finance a portion of the project.

      This Court’s recent decision in Long v. Dev. Auth. of Fulton County, 352 Ga.

App. 815, 816 (835 SE2d 717) (2019), supports the appellees’ position. In Long, this

Court considered a petition with nearly identical language to the instant petitions and

affirmed the superior court’s validation of bonds issued by the development authority.

Id. The Long petition described that the bond would be “used to acquire, construct

and equip land, improvements and related building fixtures and building equipment

. . . to be leased to [the respective appellee company] for use as a mixed-use

commercial facility and an economic development project under OCGA § 36-62-2 (6)

(N).” Id. at 816 (2). In rejecting Long’s challenge to the purposes of the bonds, we

found that Long had failed to cite “persuasive authority showing that this description

of the purpose of the bonds was deficient and did not comply with OCGA § 36-82-

75” and held that the petitions “substantially complied with the statutory requirement

in this regard.” Id. at 816-817 (2) (citation and punctuation omitted).

      In any event, the bonds will indirectly provide financing for a portion of the

projects by reducing the overall tax burden associated with the projects. Specifically,

as testified to by Nash, and as recognized by the trial court, the Company would not

                                          9
have agreed to go forward with the project but for the leasehold agreement. Bene is

correct that the projects are being financed by third-party lenders, but the relevant

transaction structure will assist in paying the debt back over a period of time. Under

the cumulative facts of this case, the purpose of the bonds is authorized by statute,

and the appellees proved that the bonds will be used for the purposes outlined in the

petitions. We therefore find no merit in Bene’s claims of errors on these issues.

      2. Bene also argues that the superior court erred by concluding that the bond

transaction does not violate the Gratuities Clause. We disagree.

      “The gratuities clause in the Georgia Constitution provides that ‘the General

Assembly shall not have the power to grant any donation or gratuity or to forgive any

debt or obligation owing to the public.’ Ga. Const. of 1983, Art. III, Sec. VI, Par. VI.”

Avery v. State, 295 Ga. 630, 633 (2) (b) (761 SE2d 56) (2014) (citation and

punctuation omitted). The Supreme Court of the United States has interpreted this

provision as not applying to a “conveyance in aid of a public purpose from which

great benefits are expected.” State of Ga. v. Trustees of Cincinnati Southern R., 248

U. S. 26, 30 (39 SCt 14, 63 LEd 104) (1918). Similarly, the Supreme Court of

Georgia has held repeatedly that there is no gratuity when the state receives a

                                           10
substantial benefit in exchange for the use of public property. See, e.g., Garden Club

of Ga. v. Shackelford, 274 Ga. 653, 654-655 (1) (560 SE2d 522) (2001).

      According to Bene, the transactions violate the Gratuities Clause because

Section 2 of the Bond Purchase Agreement permits the Company to obtain the bonds

from the Authority without paying monetary consideration; and the Company has the

ability to purchase the Authority’s interest in the project at any time for $10

(represented by the Company’s option to terminate the lease at any time under the

lease agreement and to immediately reacquire the Authority’s interest in the project

for $10). The Authority challenges these arguments, claiming that the sale-leaseback

transaction creates a tax efficiency, and the economic development expected from the

projects will provide the type of “substantial benefit” to the public that has been held

not to implicate the Gratuities Clause. Additionally, the Authority maintains that the

Company’s obligation to first convey its fee simple interest and promise to complete

the project is sufficient consideration, such that the “Company’s ability to acquire [the

Authority’s] interest in the [p]roperty for $10[ ] is of no consequence to this analysis.”

      In its orders validating the bonds, the superior court found that the evidence

supported a finding that Fulton County will derive a “substantial benefit” from the

projects at issue. At the hearing, Nash testified that the projects at issue would

                                           11
improve the county’s infrastructure, create hundreds of jobs, expand the tax rolls, and

bring economic development. For example, the Atlantic Station hotel project (Case

No. A21A1143) will create approximately 800 construction jobs, 127 full-time jobs,

and it is estimated that the project will result in $14.1 million in system and

infrastructure improvements, and $9.8 million in estimated net new property taxes

generated over a ten-year period. Based on this evidence, the superior court did not

err in concluding that the projects provided a substantial benefit for the county, and

thus the bond transactions do not result in an unconstitutional gratuity. See Avery,

295 Ga. at 634 (2) (b) (finding the county’s issuance of bond “creates a substantial

benefit for the county, namely the presence and use of an airport which can

accommodate commercial passenger flights); Garden Club of Ga., 274 Ga. at 655 (1)

(affirming trial court’s ruling that statute pertaining to outdoor advertising did not

violate gratuities clause where DOT presented evidence that “the traveling public

benefits from billboard advertising by receiving information that assists them in

making decisions”).

      3. According to Bene, the superior court placed the burden of proof on him as

to all factual matters, and this burden-shifting was in error. We disagree with Bene’s

characterization of this issue and find no error.

                                          12
      In each order, the superior court stated that “[Bene] has [failed] to prove the

facts and contentions he alleges in his Answer and Affirmative Defenses of

Intervenor.” Bene contends this language indicates that the court impermissibly

placed the burden of proof on him, when the State in fact had the burden to make out

its case for validation. The appellees argue that Bene in fact had the burden of proof

as to each affirmative defense challenging the validation process.

      While Bene is correct that the appellees were required to prove the facts

necessary to obtain validation, this obligation does not necessarily alleviate the

burden the intervenor has to show cause as to why the bonds should not be validated.

At the hearing, the superior court noted that the appellees had the overall burden of

proof, but Bene had the burden of proof as to all issues where he raised an affirmative

defense.

      Generally, “(i)f a defendant files an affirmative defense, . . . he has the burden

of proving such affirmative defense.” Metro. Publishers Representatives, Inc. v.

Arnsdorff, 153 Ga. App. 877, 878 (1) (267 SE2d 260) (1980). In the context of bond

validation proceedings,

      where an intervention has been filed by citizens and taxpayers of the
      political subdivision involved, it is the intervenors who are quasi-

                                          13
      defendants, and the technical adversary position between the governing
      authority and the solicitor general, acting for the State, will not permit
      these two entities by admissions in pleadings to establish as proved the
      essential allegations of the petition for validation, but . . . the burden is
      on the State, acting through its solicitor general, to prove the material
      facts which are requisite to obtain bond validation; and where there is
      a total absence of such proof, it is error for the court to render judgment
      validating the bonds.

Hattrich v. State, 116 Ga. App. 281, 283 (3) (156 SE2d 925) (1967) (citation and

punctuation omitted). Here, contrary to Bene’s contention and based on the superior

court’s statements at the hearing and in its order, the court did not impermissibly shift

the burden of proof. Rather, it correctly assigned the burdens of proof and found that

the appellees satisfied their burden of proof, while Bene failed to satisfy his own

burden with regard to his affirmative defenses.

      4. Next, Bene argues that the superior court lacked jurisdiction to rule on the

merits of (a) the Authority’s exemption status with regard to ad valorem taxation for

the duration of the project; and (b) the ramp-up valuation methodology. We find that

the superior court had jurisdiction to make its ruling for the reasons set forth below.

      (a) In his initial answer in the superior court, Bene alleged that the court lacked

jurisdiction in this proceeding to rule on ad valorem taxation issues because the

                                           14
proper proceeding for such a determination is one brought before the Board of

Equalization under OCGA § 48-5-311. In its validation orders, the superior court

ruled that it had “jurisdiction over the parties and over the subject matter of this

action.”

      OCGA § 48-5-311 provides the framework for a taxpayer to appeal ad valorem

tax issues to the county board of tax assessors, the board of equalization, and

ultimately to the superior court. This statute “provides a vehicle for addressing issues

related to the valuation, taxability, uniformity and constitutionality of ad valorem

taxation.” Dillard v. Denson, 243 Ga. App. 458, 460 (533 SE2d 101) (2000).

Furthermore, it is undisputed that superior courts have exclusive jurisdiction to hear

and decide all issues with regard to bond validation petitions. OCGA § 36-82-73.

Development authorities are expressly made exempt from taxation under OCGA § 36-

62-3. See DeKalb County Bd. of Tax Assessors v. W. C. Harris & Co., 248 Ga. 277,

279 (2) (282 SE2d 880) (1981) (“While the Authority is exempt, a business which

takes a leasehold from the Authority is subject to ad valorem taxation on the fair

market value of the possessory interest held.”). In its orders, the superior court simply

reiterated that the satisfaction of the development purposes of the transactions

justifies validation, and that tax exemption is a natural by-product of that validation,

                                           15
as expressly provided by statute. We therefore disagree with Bene’s characterization

of the superior court’s findings on ad valorem taxation matters as a “merits

determination.” Instead, we recognize that the court, in fulfilling its obligations under

OCGA § 36-82-73, included information necessary to the resolution of the validity

of the bonds, and we reject this claim of error.4

      (b) As to Bene’s contention that the superior court was without jurisdiction to

issue a merits-based decision on the valuation methodology outlined in the MOA, this

argument is without merit. In Sherman I, we examined a bond validation proceeding

wherein the underlying transaction structure was similar to the instant case.

Specifically,

      [t]he petition sought to create a bond transaction leasehold estate, where
      in consideration for the issuance of the bonds, [the company] agreed to
      transfer fee simple title in the Project to [the Authority], and [the
      Authority] and [the Company] agreed to execute a lease agreement
      under which [the Company] would have the right to possession of the
      Project for a term of ten years. At the conclusion of the lease term, [the
      Company] would have a right to acquire the Project for nominal
      consideration.

      4
        Bene concedes on appeal that even if this Court vacates the superior court’s
merits-decisions concerning ad valorem tax matters, the bond validation orders may
nevertheless otherwise be affirmed.

                                           16
Sherman I, 317 Ga. App. at 345-346 (footnote omitted). In connection with the

transaction, the Company, the Authority, and the Board “executed a Memorandum

of Agreement (“Memorandum”) establishing the valuation methodology the Board

was to use in assessing ad valorem taxes on the leasehold estate.” Id. at 346 (footnote

omitted). In affirming the superior court’s jurisdiction to address the validity of the

Memorandum, we noted that bonds issued under the Development Authorities Law

are required to undergo the validation process set forth in OCGA § 36-62-8 (g). Id.

at 348 (2). We did not, however, reach the narrow issue of whether the valuation

formula was proper because the taxpayer failed to raise it in the superior court. Id. at

349 (3).

      Nevertheless, we find the Sherman I court’s reasoning as to why the superior

court had jurisdiction to rule on the validity of the Memorandum itself to be

instructive on the issue of whether the superior court had jurisdiction to rule on the

valuation methodology in the instant case. Namely, the statutory framework set out

in the Development Authorities Law (in particular OCGA § 36-82-73) vests the

superior court with exclusive jurisdiction to hear and determine all matters relevant

to bond validation.

                                          17
      Finally, we find additional support for affirming the trial court’s order in

Sherman v. Fulton County Bd. of Assessors, 288 Ga. 88 (701 SE2d 472) (2010)

(“Sherman II”). In Sherman II, the taxpayer brought an action for declaratory

judgment, injunction, and mandamus against the county Board of Tax Assessors

(“BTA”) and others, contending that the BTA’s method of valuing leasehold estates

arising from the local development authority’s sale-leaseback bond transaction was

(a) illegal and (b) otherwise constituted a failure of] the defendants to perform their

duties. Id. at 88. In remanding the case, our Supreme Court implicitly recognized the

power of the superior court, in a bond validation proceeding, to evaluate the propriety

of the valuation methodology outside the context of the process set forth in OCGA

§ 48-5-311. Id. at 95 (“Therefore, the present challenge to the memoranda of

agreement that set forth the tax assessment formula at issue will only constitute a

prohibited collateral attack on a concluded bond validation proceeding if the

memoranda were specifically adjudicated in the proceedings and held valid by the

bond judgment.”).

      Accordingly, the aforementioned statutes and underlying rationales in Sherman

I and Sherman II support the superior court’s exercise of jurisdiction concerning the

issue of the methodology formula expressed in the MOA.

                                          18
      5. Bene contends that the superior court erred because the validation order fails

to comply with OCGA § 9-11-52 (a), which requires that, upon request, the judgment

of the court include written findings of fact and conclusions of law. Bene requested

such findings. Specifically, Bene argues that the superior court’s order lacked the

requisite findings on two issues: (a) whether the court had jurisdiction to address the

ad valorem tax issues; and (b) the superior court’s basis for concluding that the bond

transactions do not violate the Gratuities Clause.

      As to the jurisdiction issue, in his answer, defenses, and objections to the bond

validation petition, Bene asserted that the superior court lacked subject matter

jurisdiction to rule on the tax exempt status of the property interests held by the

Authority or the validity of the ramp-up formula. According to Bene, jurisdiction to

“test the legal validity of a real property tax assessment is in a proceeding brought

under OCGA § 48-5-311.” In its validation order, the court correctly noted that

OCGA § 36-82-73 vests exclusive jurisdiction over bond validation matters in the

superior courts. More specifically, OCGA § 36-82-11 makes clear that the bonds

issued by the Authority “shall not be subject to . . . any other law.” Based on the

foregoing statutory provisions, the court reasoned that it had subject matter

                                          19
jurisdiction to validate the bonds.5 Therefore, contrary to Bene’s assertion, the

superior court explained why it had jurisdiction, and that explanation was sufficient

to satisfy the requirements of OCGA § 9-11-52.

      With respect to the Gratuities Clause issue, the superior court set forth evidence

that the projects would create new jobs and promote industry and employment

opportunities for the public good. The court then looked to relevant case law, and

applied it to the facts of this case to conclude that the Authority had “demonstrated

through substantial evidence that the Bonds here provide a substantial benefit to the

people of Georgia through economic development and job creation.” This inclusion

of the relevant facts and application of legal authority complies with OCGA § 9-11-

52. Moreover, viewing the superior court’s orders as a whole, they contain exhaustive

recitations of the underlying facts and corresponding conclusions on a myriad of

issues. And, an examination of the hearings before the superior court and a

comparison to the validation orders demonstrates that the court’s orders contain

adequate findings of fact and conclusions of law on the issues Bene now challenges.

See Franzen v. Downtown Dev. Auth. of Atlanta, 309 Ga. 411, 421-422 (3) (c) (845

      5
       As explained more fully in Division 4, supra, the superior court correctly
concluded that it had subject matter jurisdiction over these issues.

                                          20
SE2d 539) (2020) (concluding that superior court made adequate findings of fact and

conclusions of law, pursuant to OCGA § 9-11-52 (a), to support conclusion that

enterprise zone bond proposal and corresponding security provided by infrastructure

fees was sound, feasible, and reasonable, despite court’s isolated recitation that “both

the issuance of the [bonds] and the security therefor are sound, feasible, and

reasonable, as demonstrated by the evidence adduced at the hearing, including the

fact that the bonds will be issued only upon proof of work completed and

expenditures made;” indeed, superior court entered two orders setting forth

comprehensive findings and conclusions after three-day hearing, and extensive

evidence was in fact presented during hearing regarding mechanics of bond financing

structure, and this information was included in record and discussed in trial court’s

orders). Accordingly, there is no need to remand this case to the superior court for

additional findings.

      6. Finally, Bene argues that the superior court erred by ruling that the MOA

does not limit the Board’s discretion as to the methodology used to value the

leasehold estate. According to Bene, the MOA, to which the Board is a party, illegally

restricts the Board’s exercise of discretion by requiring the Board to use the ramp-up

formula to value the Companies’ leasehold interests. As an initial matter, we disagree

                                          21
with Bene’s characterization that the Board’s choice to execute the MOA represents

a loss of discretion, rather than an exercise of discretion in and of itself.

      More to the point, this Court and the Supreme Court of Georgia have examined

ramp-up formulas nearly identical to the one at issue in this case, and have not found

the formulas to be inherently unlawful. See, e.g., SJN Properties, LLC v. Fulton

County Bd. of Assessors, 296 Ga. 793, 794, 798-803 (2) (b) (770 SE2d 832) (2015);

Long, 352 Ga. App. at 823 (4). Specifically here, the superior court found that the

MOA confirms that the Board “will use appropriate valuation methodologies in

valuing the [p]roject and will follow the law set forth in [DeKalb County Bd. of Tax

Assessors v. W. C. Harris & Co.] and [Sherman v. Dev. Auth. of Fulton County].” The

court then highlighted that:

      The value of neither the fee simple interest of the [Authority] nor the
      leasehold interest of the Company are established in advance; rather, on
      an annual basis, the [Board] will appraise the value of [the Authority’s]
      fee simple interest in the subject property using all appropriate valuation
      methodologies just as it does when valuing any other similar property.
      The MOA specifically provides that “[t]he determination of the fair
      market value of the fee interest in any asset in any year following the
      Tax Commencement Date (prior to being reduced by the applicable
      percentage) will be subject to periodic reassessment, for which the
      [Board] will employ its standard valuation methods.” . . . In other words,

                                           22
      and of critical importance, nothing whatsoever in this transaction affects
      the manner in which the fee simple value of the property at issue will be
      valued.

(Emphasis supplied.) Based on this language in the superior court’s orders, and

our own reading of the MOA, we disagree that the Board has impermissibly

ceded its discretion under the MOA’s terms.

      Finally, Bene has failed to point to evidence that the valuation

methodology set forth in the MOA is arbitrary or unreasonable. See SJN

Properties, LLC, 296 Ga. at 797 (2) (“(T)he overriding issue in this case is

whether the valuation method used by the defendants fairly and justly

establishes the fair market value of a bond transaction leasehold estate such that

the method is not arbitrary or unreasonable.”) (citation and punctuation

omitted); DeKalb County Bd. of Tax Assessors, 248 Ga. at 280-281 (3). See also

OCGA § 36-80-16.1 (e). Accordingly, this claim of error is without merit.

      Judgments affirmed in Case Nos. A21A1143, A21A1144, A21A1145,

A21A1146. Barnes, P. J., and Miller, P.J., concur.

                                         23