In Georgia, Community Improvement Districts (CIDs) are a creation of
state government (they're in the amended 1984 state constitution)
that involves local governments in serious potential conflicts of
interest, in order to allow developers to fund their public
infrastructure with tax-free bonds. CIDs are a clever idea, but
cleverness is often inconsistent with government ethics. Smith,
Gambrell & Russell, a law firm, has
a
good, short overview of CIDs.
The county and/or city in which a CID is located approves and even participates in the management of the CID (the local government(s) gets one seat on the CID board). Approval by landowners is not
based on one-person one-vote, but rather on the value of real
estate, which gives the power to commercial entities. The major
landowners also vote for board members. But all landowners pay the
assessments, along with their county taxes, so that the county is
involved in this aspect, as well.
CIDs can also enter into cooperation agreements with counties or
cities, so that, for example, a county may agree to maintain the
roads built with bonds issued by a CID.