AJC - Dunwoody: How a new city is finding its way

By April Hunt of the AJC

Jenny Troha supported Dunwoody becoming its own city because it meant more local control.

The stay-at-home mom got a taste of exactly what that meant when her 8-year-old daughter, Emma, wrote the new mayor asking for sidewalks on Valley View Road.

Mayor Ken Wright wrote back, explaining that the city was focusing this year on sidewalks near schools but that busy thoroughfares like Valley View were on the list for coming years.

“It was a good lesson in civics for her but it was also nice to see that the government really cares about the constituents,” Troha said. “I feel like we’re in a pretty good place right now, as a city.”

Dunwoody became Georgia’s newest city – and 16th largest in the state – when it incorporated on Dec. 1, 2008.

Advocates said cityhood would mean residents would have closer and better government that would address their specific needs.

Opponents argued against the finances, predicting the proposed budget underestimated expenses. Services would need to be scaled down or taxes would have to go up.

Turns out, both were right.

For instance, the city of 40,000 put a police force on the street in just four months, earning praise from residents and political watchers alike.

The price tag for the department, though, more than doubled original estimates, up to $5.7 million from estimates of $2 million. Costs went up largely because the department swelled from a projected 29 full-time employees to 48 officers and civilians.

The key in making such disparities work has been Dunwoody’s willingness to learn from other cities, both from other established cities in DeKalb County and start-ups in neighboring Fulton.

Early on, Dunwoody leaders concluded the city couldn’t outsource all services to just one firm as all the other new cities had done. Its city millage rate is 2.74, about half that of neighboring Sandy Springs, which had started the new-city trend of signing up one company to handle daily operations.

Dunwoody couldn't afford that, so it bid for all services. It ended up contracting with one firm to handle administration and finance, another for public works and a third for planning and zoning.

Residents supported the move, which ended up saving Dunwoody more than $2 million a year from the original one-firm bid.

Moreover, the city has done it without raising taxes from when it was part of unincorporated DeKalb. In fact, Dunwoody's charter stipulates the city can only raise taxes up to one mil without a vote of the citizenry, or about $160 on a house assessed at $400,000.

"I feel like we have a much better voice," said Todd Helton, a salesman who grew up in Dunwoody and moved back about 11 years ago. "It makes a difference to know you're being listened to."

City advocates had also watched from the sidelines as DeKalb and its existing cities battled for nearly a decade over divvying up sales tax money. The county collected sales tax money from the state and was to share those funds with the cities, though the governments have not been able to agree on how to allocate that cash.

Dunwoody’s charter tried to avoid that battle by laying direct claim to the money from the state.

The state Supreme Court agreed with the city this year, awarding the city $2.5 million as its share in 2009 and another $1.6 million projected for this year. That means instead waiting on the to county pass any sales tax money along, Dunwoody takes its share directly from the state revenue department.

Those savings have helped the city set aside $800,000 for road paving, $100,000 for an annual sidewalk program and leave enough money on hand to begin big-picture plans for its parks and commercial areas such as Dunwoody Village.

“Their goal has been for residents to see a direct line from their taxes to what they get in services,” said Katherine Willoughby, a professor of public management and policy at Georgia State University. “It speaks well for Dunwoody that they have done that.”

Willoughby authored a study two years ago that projected DeKalb County would lose about $16 million per year if the area became a city. The biggest losses would come in property taxes and business licenses but also include fines, forfeiture and other income.

The county was unable to make up for much of that loss, because it needed to continue to fund countywide services such as its police force and parks, said Joel Gottlieb, the county's interim chief financial officer. That loss of Dunwoody's revenue hit at the same time that the economy turned, forcing DeKalb to push more than 600 employees into early retirement and to make other cuts across its departments.

That financial reality had even some ardent supporters of cityhood worried.

“I felt like DeKalb had done a lot for us and we kind of abandoned them,” said Susan Hopkins, the owner of a travel agency who has lived in Dunwoody since 1986. “It’s just we have a lot of citizens who wanted something local, so they could be involved.”

Dunwoody and its citizens remain involved in county issues. Current topics include a clash with the DeKalb School Board over a drainage pond, built during new construction at Dunwoody High, that poses a possible health hazard. There is also ongoing demand for answers after a 74-year-old woman died in a January fire at a house that DeKalb firefighters had checked five hours earlier but left when they couldn't find the blaze.

But throughout, the city and county meet often and DeKalb CEO Burrell Ellis believes that communication has helped them avoid the bad blood has made for for tense dealings in Fulton County.

“Sometimes we have mutual interests and sometimes we need to negotiate,” Ellis said. “But we have a common fate.”

That could transform Dunwoody, already the largest city in the county, into the business model for DeKalb’s other nine cities. Those cities, for instance, stand to collect millions from the county based on the Dunwoody sales tax ruling.

Dunwoody has also joined with other DeKalb cities on grant applications. One, for a federal energy grant, effectively doubled the impact of the application by adding Dunwoody's 40,000 residents to Decatur, Doraville and Chamblee, which combined equals Dunwoody's population.

"Overnight, you added a pretty big player to our team," Chamblee City Manager Jim Gleason said. "They've reached out and really strengthened the relationship of all the cities in DeKalb County."

That gives all DeKalb cities a bit more clout in a county that is about 75 percent unincorporated. A vote on annexation in November is expected to add about 6,000 residents to Chamblee, creating a joint border with Dunwoody as well as gradually forming a swath of cities in the northern part of the county.

Being home to Perimeter Mall and the surrounding businesses already makes Dunwoody the retail and office capital of the county. The city has more than 2,350 licensed businesses, including more than 120 restaurants, 60 medical offices and 33 law firms.

Those businesses will generate more than $2.3 million this year in county occupational taxes alone.

That money helps Dunwoody focus on its Three Ps – police, paving and parks – while giving it a chance to be a voice for the larger area, Wright said.

“In Dunwoody, you’re OTP but in town,” Wright said of the city limits, which lie mostly outside the Perimeter but link to the larger area. “We don’t distance ourselves from the rest of metro Atlanta. We are modern-day Atlanta.”