[HISTORY: Adopted by the City Council of the City of Walhalla 9-17-2017 by Ord. No. 2017-7. Amendments noted where applicable.]
This chapter shall be titled the "Economic Development Incentive
Program."
The Economic Development Incentive Program is enacted pursuant
to the powers conferred upon the municipality.
The purpose of the Economic Development Incentive Program is
to allow public support of economic projects to foster, promote and
enhance local economic development efforts. The purpose of this chapter
is to allow the City of Walhalla to enter into an agreement with a
person, firm or corporation who/that undertakes a development project
consistent with the City's adopted Comprehensive, Master Plans and/or
redevelopment plans and the provisions herein.
As used in this chapter, the following terms shall have the
meanings indicated:
The value to the City of providing the incentives, which
generally include:
Increased property values within the City as a whole;
Increased revenues from property taxes, business license fees
and permit fees;
Increased tourism and commercial activity within the City;
The creation of new jobs within the City; and
The improvement of the character of the City by preserving buildings
as appropriate within the City; and promoting the construction of
new buildings that are compatible with the City's character.
An activity that adds value to the City's tax base by the
acquisition and/or improvement of real property.
Meeting the capital investment in the development of multiple
real properties during a maximum period of five years.
The activity of improving a real property to the extent of
adding value to the tax base through real property improvements, and
the creation and/or retention of employment opportunities.
A grant of any inducement having monetary value by the City
of Walhalla that is offered to a person, firm or corporation to pursue
a development that encourages private investment and/or the creation/retention
of jobs. The incentive may also include grants from other entities
that the City may be able to obtain.
The difference in the real property value at the beginning
of the incentive period and the real property value upon completion
of the first taxable year of occupancy of the new development.
Improvements to undeveloped land consisting of sanitary sewers,
streets and storm sewers located in a public right-of-way which by
nature provide service to the general public. Similar nonpublic improvements
which are oriented to a specific structure or structures, such as
a sidewalk from the street to a specific structure or structures,
a sewer line serving a specific structure or structures, a driveway
serving a specific structure or structures, etc., are not classified
as infrastructure for purposes of this chapter.
Each new full-time position or each full-time-equivalent
position that is created as a direct result of ongoing operation of
a development. For the purposes of calculating the number of jobs
created by a development, only those employed at business directly
associated with the development at positions permanently located within
the City shall be considered.
Real property value is defined according to the value assigned
by the Oconee County Tax Assessor's Office.
A.
Authorization to grant incentives. The City Council may, at its discretion,
and on a case-by-case basis, and according to available funding, enter
into an economic development incentive agreement with a person, firm
or corporation for the purpose of providing incentives in order to
encourage and support the development of real property within the
City or which is annexed into the City.
B.
Incentive agreements. The provision of incentive(s) shall be made
only after an agreement has been entered into between the City and
such person, firm or corporation, which agreement shall set forth:
the particulars of the development; the incentives to be provided;
and sufficient assurances that the benefits will accrue to the City
and the goals will be met by the development (an "incentive agreement").
Pending approval by the Council of any incentive agreement and subject
to the provisions provided herein, the City Administrator is authorized
to discuss the provisions of this Economic Development Incentive Program,
aid in the completion of any proposal and, subject to the final approval
by Council, negotiate with the potential incentive recipient on behalf
of the City. Each incentive agreement shall be approved by Council
by ordinance. Council is authorized to provide incentives in any amounts
and for any period of time within the thresholds provided herein or
within the time periods and thresholds provided for in any applicable
statutory authorization.
Except for those incentives discussed in § 25-7I below as authorized by the state and which are intended by the terms of this Economic Development Incentive Program to be applied City-wide, in order for a development to be eligible to receive incentives, the Council must determine that the development meets, or upon completion will meet, each of the following criteria:
A.
The development must be consistent with the City of Walhalla Comprehensive
Plan and the City of Walhalla Master Plan, as adopted.
B.
The development must be located within the City limits of Walhalla
or establish a location for business within the City even if it has
previously conducted the same or similar operations at locations outside
the City.
C.
The development must have a minimum threshold investment which may
be comprised of a combination of physical improvements and acquisition
costs; such threshold investment may be comprised of a single real
property investment or a cumulative investment.
D.
The development must be for one or more of the following:
(1)
Retail uses as identified in the most current Retail Market Power
Database provided by Claritas.
(2)
Tourism-related business or activity.
(3)
Cultural arts activities and associated businesses.
(4)
District offices or corporate headquarters.
(5)
Research and development.
(6)
High technology growth business.
(7)
Residential projects including three or more single-family units,
multifamily units or condominiums.
(8)
Other uses as may be determined the City of Walhalla which meet the
intent of this chapter and as are identified more specifically according
to the adopted master plans and/or redevelopment plans.
E.
The City reserves the right to exclude from consideration proposed
projects that it deems incompatible with the City's Comprehensive
Plan, Downtown Master Plan or with the City's overall goal of encouraging
development that will strengthen property values and enhance appearance
and quality of life within the community. Such proposed projects include
but are not limited to the following:
F.
No business and no successor or affiliated business entity having
one or more of the same principals and substantially the same business
activity may cease business operations in the name of one business
and then resume business operations in another name if the effect
of such resumption is to circumvent this section or to prolong the
incentives provided beyond the incentive agreement.
The Council may, at its discretion and on a case-by-case basis,
enter into an incentive agreement to reimburse or refund any person,
firm or corporation proposing to invest in development or redevelopment
of property within the City of Walhalla the following fees and taxes
up to the amounts and percentages provided for herein:
A.
Up to 100% of the applicable tap fees collected by the City.
B.
The following business license tax incentives:
(1)
Year 1: A grant in the amount of 100% of the business license tax
due to the City will be reimbursed after the business license taxes
are paid to the City of Walhalla.
(2)
Year 2: A grant in the amount of 75% of the proposed business license
tax rate based on gross income after the taxes are paid to the City
will be reimbursed to the applicant.
(3)
Year 3: A grant in the amount of 50% of the business license tax
rate based on gross income after the taxes are paid to the City will
be reimbursed to the applicant.
(4)
Year 4: A grant in the amount of 25% of the business license tax
rate based on gross income after taxes are paid to the City will be
reimbursed to the applicant.
(5)
After Year 4, business license taxes will be the responsibility of
the property owner/business owner and will be the proposed rate based
on gross income.
C.
Up to 50% of the local hospitality taxes collected by the City for
as many as five years, but funds received through such incentive are
to be spent only for purposes that are related to tourism, pursuant
to S.C. Code Ann. § 6-1-730, and which have been approved
by Council and included in the incentive agreement.
D.
Up to 50% of local accommodations taxes collected by the City for
as many as five years, but funds received through such incentive are
to be spent only for purposes related to tourism, pursuant to S. C.
Code Ann. § 6-1-530, and which have been approved by Council
and included in the incentive agreement.
E.
Up to 100% of solid waste fees for as many as five years.
F.
Up to 100% of infrastructure costs for commercial development projects
for as many as five years.
G.
Up to 100% of infrastructure costs for residential development projects
for as many as five years.
H.
Such other incentives that the Council, at its discretion on a case-by-case
basis, determines are appropriate given the amount or type of investment
made by the incentive recipient.
I.
State incentive programs. The state programs that may be considered
by Council to be included within any package of incentives or as a
standalone set of incentives for in-City projects:
[Amended at time of adoption of Code (see Ch. 1, General
Provisions, Art. II)]
(1)
Property tax credits authorized by the provisions of the South Carolina
Abandoned Buildings Revitalization Act, codified at S.C. Code Ann.
§ 12-67-100 et seq. (collectively, the "Abandoned Building
Act"). Incentive recipients requesting consideration for the Abandoned
Building Act by Council shall submit an Abandoned Building Act application
form.
(2)
The South Carolina real property tax credit for the installation
of a fire sprinkler system, codified as S. C. Code Ann. § 12-6-3622.
(3)
Property tax credits authorized by the provisions of the South Carolina
Textiles Communities Revitalization Act, codified at S.C. Code Ann.
§ 12-65-40.
A.
The person, firm or corporation must submit to the City Administrator
a proposal for the Economic Development Incentive Program, to include
the following information:
(1)
Identification of the property or properties on which the development
is to be located and any acquisition cost thereof;
(2)
The estimated start date and completion date for any work to be performed
on the property;
(3)
A list of any physical improvements that are to be made to the property
as part of the development, including good faith estimate costs;
(4)
The then-current value of property and good faith estimate of the
value of the property upon completion of improvements thereto;
(5)
A good faith estimate of the number of jobs that the development
is projected to create, including an estimate of the date upon which
the estimated number of jobs will have been created;
(6)
Sufficient documentation on the development, and an agreement to
furnish good faith estimates on projected sales tax, assessed valuation
and other information as may be needed to determine the incentives
that may be provided and the amount of the incentive.
B.
The grant incentive amount shall be determined based upon the amount
of the capital investment and new revenue generated as a result of
the capital investment as calculated over a period not to exceed five
years. The five-year or less grant term shall commence with the issuance
of the certificate of occupancy, issuance of a business license and/or
other criteria corresponding to the eligibility factors. The grant
incentive shall require annual monitoring by the City of Walhalla
to ensure continued program compliance; monitoring during the grant
incentive period shall include benchmarks such as, but not limited
to, the completion of the first taxable year of occupancy and first
year of operation of the identified business use; benchmarks shall
be monitored for each year of the incentive period.
C.
The total incentive amount shall not be greater than the direct value
received by the City and derived from the capital investment during
the term of the incentive.
D.
The City may provide to an incentive recipient any combination of
incentives provided for herein; provided, however, that the total
amount of incentives given to a development must be in keeping with
the goals and the value of the benefits accruing to the City (and
its citizens) and must be greater than the financial value of the
incentives to an incentive recipient.
E.
All direct incentives of the City shall be granted in the form of
reimbursements and refunds of fees and taxes that have been duly paid
to the City. No upfront abatements of fees or taxes shall be permitted.
F.
The City of Walhalla may at its discretion extend the incentive time
period if deemed warranted based upon the continuing benefit created
by the investment.
G.
The City of Walhalla may increase or decrease the amount of the incentive
based upon actual development and real property values as determined
through the monitoring process.
H.
If at any time during the incentive period the development's use
does not meet the eligibility criteria, then the City shall deem the
agreement null and void.
I.
If at any time during the incentive period the development is sold,
then the City shall deem the agreement null and void.
J.
If at any time during the incentive period the real property value
is appealed, then the incentive amount may be renegotiated or voided.
K.
The administration of this program shall be the responsibility of
the City Administrator.
L.
The City Council, at its discretion, may consider for program participation
any development in progress at the time of passage of this chapter
which meets the program criteria.
