Around Town: The Fabric.com Giveaway — Discrepancy? Or Deception?
by Marietta Daily Journal Editorial Board
June 19, 2012 12:00 AM | 3441 views | 0 0 comments | 11 11 recommendations | email to a friend | print
EXACTLY HOW MANY incentive dollars will be flowing to help Fabric.com move from Marietta into a new, larger building on Jiles Road in Kennesaw? Turns out that’s a figure that’s almost as hard to pin down as the actual number of people working at Fabric.com. And it’s a number that’s going up, not down.

As the Journal has reported, the Kennesaw Development Authority has agreed to give a total of $50,000, though that cash will officially be going to Republic Fund/Jiles Road I LLC.

But as it turns out, there are more public dollars involved. The Development Authority of Cobb County has also agreed to write a check for at least $50,000 — and perhaps as much as $100,000 — to Republic — although the giveaway reportedly comes as news to at least some members of the Cobb board.

***


NELSON GETER, executive director of the Development Authority of Cobb County, told the Journal on Monday: “The company asked for $50,000, which was offered to them. They came back again and asked for an additional $50,000. We said in effect the authority was only approving $50,000 now, but the authority will consider another request for funding for calendar year 2013. We said that would have to have full board approval.”

Don’t be misled by his statement that “The authority was only approving $50,000 now.” The authority members never actually voted on the proposal, of course. In fact, Geter never even told the development-authority board that he had agreed to give away the $50,000, according to board member Thea Powell. (Development Authority policy apparently gives the director discretion to hand out checks of up to $100,000 without board approval.) But other documents indicate a discrepancy at best, and deception at worst.

According to Republic Fund’s application for incentives in Kennesaw, the Development Authority of Cobb County had already awarded Republic $100,000, to be paid in two installments of $50,000 each. And a Jan. 25 email from Kennesaw community development director Bob Fox to city officials also indicates the $100,000 is a done deal.

“Brooks and Nelson agreed to support the retention of Fabric.com in Cobb and relocation/expansion in the Republic building with an additional $50,000. They will provide $50,000 in spring 2012 and an additional $50,000 in summer 2013,” Fox wrote. “I spoke with Nelson and Brooks today and they confirmed their chairman agreed.”

Brooks is Brooks Mathis, the Cobb Chamber’s vice president of economic development. Former state Rep. Don Wix (D-Mableton) is chairman of the Cobb development authority. The towering Wix enjoyed the limelight as a member of the UGA basketball team decades ago, but has preferred operating in the shadows as chairman of the development authority.

Geter insists that Fox’s email was inaccurate. But he acknowledged not telling his board about the 50 grand. Why?

“We have to keep the project in confidentiality until such time as the project is announced,” he said. What? Geter is keeping secrets from his own board? The members of whom are appointed by the Cobb Board of Commissioners, ostensibly to oversee the parceling out of public dollars as enticements for business development? Such secrecy has been standard practice at the authority in recent years. The Journal last year uncovered the fact that authority members for years had routinely approved such incentives without knowing the amounts or the recipients, and that the chairman of the county board of commissioners usually pulled the strings on such transactions.

Meanwhile, Geter remains something of a mystery man. The retired Georgia Power exec was quietly hired back in January. You might think it’s a rare day that an executive director feels comfortable leaving his board out of the loop even during his own “shakeout period.” But not, apparently, at the Cobb Development Authority.

***


BUT THE STORY GETS BETTER. Geter also told the MDJ on Monday that Fabric.com would be required to add only 25 new full-time jobs, though the Kennesaw Development Authority will insist on 50.

“Based on the information we got, they currently had 200 employees,” Geter said. “We just did a 25 employee add on to that, and said by Dec. 31, 2013, you must have a total of 225 full-time employees.”

Readers may recall that although the Chamber and the city of Kennesaw announced that Fabric.com has 200 employees and would add 50 new jobs with the move, the company’s employee headcount has been all over the waterfront.

On its business-license application in the city of Marietta, which was submitted in March, the company reported having 156 employees. In response to follow-up questions after the Chamber announcement, Fabric president/GM Stephen Friedman said his company has “roughly 275” employees.

From documents received through open records requests, the Journal also learned that although discussions have been ongoing for several months and Fabric.com signed its lease back in January, the announcement was not made until the June 4 First Monday Breakfast hosted by the Chamber, because of the legislative session.

“At the request of Fabric.com we have delayed issuing the press release and scheduling an announcement … until after the end of the session,” Fox wrote in a March 26 email to Kennesaw Mayor Mark Mathews. “They were concerned about any visibility on the project until the session ended due to the bill addressing sales tax on internet sales. … Also, Fabric.com wanted to coordinated [sic] folks coming in from Seattle for the event.”

For his part, Matthews told AT, “We’ve had multiple deals that we’ve lost at the big brand new Republic building, the 200,000 square foot brand new industrial space. We didn’t qualify for an opportunity zone because it’s a nice area. It’s convenient to the interstate, it’s got everything you ever would need, but it can’t compete with what Marietta has in some cases, what Smyrna has in some cases.”

Don’t be surprised if the Fabric.com move comes up when the Cobb development authority meets at 11 a.m. today.

***


COBB SCHOOL-BOARD WATCHERS were left shaking their heads late last week after reading in the MDJ of how Superintendent Dr. Michael Hinojosa had put himself on a clear collision course with most of the school board. He notified them at Wednesday’s work session that he had decided to apply for $25 million in federal Race to the Top funds — even though a majority of his board still appears to be opposed to the concept.

Much of the board was caught off guard — and not happy about it — when it learned in January that the super had applied for two Race to the Top-funded programs without their knowledge. It was “same song, second verse” on Wednesday, as four (Alison Bartlett, Kathy Angelucci, Tim Stultz and Lynnda Eagle) of the seven members expressed opposition to seeking the money, which would come in annual increments of $5 million if it were approved.

If the grant application is approved, expect a battle royal between the super and the board. Many board-watchers are amazed that a first-year super like Hinojosa would embark on such a risky course.

Critics of the Obama administration’s keynote Race for the Top program note that even if the county were to get the grant money, it would be on the hook for funding any new programs itself after the grant expired. They also complain that the money would mean further loss of local control. Washington provides about 7 percent of public school funding to states, but generates 50 percent of the regulations that local systems must then adhere to, critics say.

Moreover, anyone who thinks former community organizer Obama has all the answers on what ails public education should take a look at the great answers he had how to cure the economy, critics say.

Georgia school superintendents have the authority to put items out for bid and apply for grants without the expressed approval of their boards, but cannot actually buy the items or accept the grants without such a vote.

Few CEOs in corporate America would embark on a major initiative like the one Hinojosa is chasing without the full support of their board. But then, perhaps this is just one more example of the many things wrong with public education.

***


POLITICS: Cobb Commission Chairman Tim Lee will conduct a “meet and greet” from 5:30 to 7:30 p.m. Thursday at The Windsor, Suite 105, at 2655 Cobb Parkway in Kennesaw. …Stacie and Steve Kennedy will conduct a reception for Cobb Superior Court judicial candidate Van Pearlberg from 5:30 to 7 p.m. on Thursday at their home in Mableton. And Mr. and Mrs. Bill Tyler will conduct a reception for Pearlberg from 4 to 6 p.m. Sunday at their home in Smyrna.

Comments
(0)
Comments-icon Post a Comment
No Comments Yet
*We welcome your comments on the stories and issues of the day and seek to provide a forum for the community to voice opinions. All comments are subject to moderator approval before being made visible on the website but are not edited. The use of profanity, obscene and vulgar language, hate speech, and racial slurs is strictly prohibited. Advertisements, promotions, and spam will also be rejected. Please read our terms of service for full guides