The Development Authority of

Peachtree City has approved a new agreement that would reduce its share

of the city's hotel-motel tax, which it uses to subsidize operation of

the city's tennis center and amphitheater.

If the arrangement is approved

tax funds for the current fiscal year, a cut of $85,000 from the $265,000

amount set by the current agreement.

"We feel $180,000 is a

realistic number," said authority member Brian Palmitessa.

Authority member Scott Bradshaw

said the authority may have to raise ticket prices for the summer concert

series and court fees at the tennis center to make up for the loss in

hotel-motel tax funds. The majority of both facilities' budgets comes

from ticket revenues, sponsorships, memberships and court fees.

Under the new agreement, the

authority's hotel-motel tax funds for next year would be capped at $140,000,

but the amount would be based on 15.113 percent of the hotel-motel tax

revenues collected by the city, according to the agreement. For the third

year of the agreement, the authority will set a goal of reducing the funding

to a maximum of $100,000. After that, the funding amount would be renegotiated.

The agreement also stipulates

that the city would take over the authority's indebtedness of up to $1.456

million, financing that amount in payments of up to $75,000 a year. In

return, the authority agrees not to take on any more debt without approval

from the City Council.

The agreement allows the authority

to get a short-term 90-day line of credit up to $180,000 to finance deposits

for acts that will appear in the amphitheater's summer concert series.

The authority pays back that temporary loan once it receives its revenue

for ticket sales, Palmitessa said.

Bradshaw pointed out that the

authority's current long-term debt funded capital improvements and operations

of both the amphitheater and tennis center, which are both owned by the

city.

Any new improvements or renovations

to the amphitheater or tennis center would have to be funded by the council,

said Virgil Christian, the authority's executive director.

The vote to approve the new

agreement was unanimous, with chairman Tate Godfrey absent.

The new agreement would be

automatically renewed each year unless either party gives written notice

at least 90 days prior that it wishes to let the agreement lapse.

The new agreement does not

address how much funding the authority will receive from the city for

economic development, which Mayor Steve Brown has said was what he wanted

the authority to focus on.

"That all depends on what

their vision is for us," said authority member Robert Brooks, who

participated in the negotiations along with authority members Doug Warner

and Palmitessa and council members Dan Tennant and Murray Weed.

The authority subcommittee

also met twice with Mayor Brown to resolve the issues addressed in the

new agreement, Brooks said.

A key element not in the agreement

is the subcommittee's plan to meet quarterly with council members to keep

them aware of what is going on with the authority, Brooks said.

Next year, when the authority's

funding would revert to a percentage of the hotel-motel taxes collected

seasonal trends of the revenue stream, Brooks said.

City council members want to

make sure the city doesn't have to use money from the general fund to

operate the tennis center or amphitheater, Brooks said.

Christian said he felt the

authority could cut its budgets for the tennis center and amphitheater

to meet the reduced funding levels.

"I think we can do it

but everything has to click," Christian said.

Palmitessa said he was investigating

possible financing of the authority's long-term debt that would put the

annual payments under the $75,000 mark for the city.

The city's airport authority,

which also depends on hotel-motel tax revenues for its capital improvement

program, recently approved a new hotel-motel tax agreement that the City

Council will consider at its regular meeting Thursday night.

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