In several prior posts, I’ve covered Georgia’s multi-year contracting statutes. These statutes authorize local governments to enter into multi-year contracts and leases without running afoul of other statutory restrictions, as long as certain conditions are satisfied. A recent case addressed whether a contract fit within the confines of the multi-year statute applicable to counties and cities. City of Albany v. S. Georgia Rails to Trails, Inc., A25A0061, 2025 WL 1554186 (Ga. Ct. App. May 6, 2025)
See prior posts about multi-year contracts of local governments:
- Bill would expand multi-year construction and procurement authority in Georgia – Cook & Associates
- Local Government’s Multi-Year Contract Held Valid in Supreme Court Opinion – Cook & Associates
- Update on Local Governments’ Constitutional New-Debt Limitation – Cook & Associates
In South Georgia Rails to Trails, a landowner and the City executed a contract under which the landowner sold property to the City in exchange for $150,000, and in return, the City agreed to develop the property for “public open space and recreational purposes, including the development of a multi-use trail and installation of City utility lines” within five years after the purchase. The City never developed or constructed on the property, the five-year period lapsed, but the City continued using the property for its utility lines.
In response to the landowner’s complaint, the City moved to dismiss because the contract did not comply with the multi-year contract statute. But the Court concluded the statute did not apply because the contract was a within the City’s proprietary functions. “Activities that are undertaken primarily for public benefit rather than for revenue production are governmental functions and the [municipality] is shielded from negligence claims by sovereign or governmental immunity.” Thus, the multi-year contracting statute did not affect the contract.
The City also argued that the statute prohibiting council actions that bind future councils rendered the contract void. The Court rejected this argument because that statute does not apply to contracts within the local government’s proprietary functions. Since it concluded the contract was within the City’s proprietary function, the statutory prohibition against binding successors did not apply.
