Commissioners expected to create new ‘enterprise’ zones
by Sarah Westwood
June 24, 2014 04:00 AM | 4467 views | 1 1 comments | 10 10 recommendations | email to a friend | print
MARIETTA — Patches of the county in need of an economic shot in the arm will soon receive a jolt in the form of a tax incentive program administered by the Board of Commissioners.

Tonight, the board is expected to vote on creating two new “enterprise zones” — one between Powers Ferry and Delk roads and one that encompasses parts of Smyrna and unincorporated Cobb — in addition to expanding the boundaries of an existing enterprise zone along Canton Road.

Enterprise zones are areas in which new or existing businesses can apply to receive economic incentives from the county in exchange for bringing jobs and commerce to the vicinity.

Dana Johnson, deputy director of the county’s Community Development Agency, said areas must meet three of five state and locally mandated criteria in order to be eligible to become enterprise zones: pervasive poverty, unemployment, general distress, underdevelopment and general blight.

Johnson said the proposed enterprise zones meet four of the five, noting blight could not be used as a benchmark because the county lacks an urban development authority, the entity responsible for assessing general blight.

“One of the things that we do is we try to find areas that meet the state and local requirements for enterprise zones so we can provide opportunities for business expansion in some areas that are underdeveloped,” Johnson explained. “As part of our research, these two areas came up as being compliant with state and local laws.”

Johnson said incentives offered to qualified businesses within the zones include a bevy of tax reductions.

Approved businesses can pay lower state, county and municipal ad valorem taxes, Johnson said, as well as lower occupational taxes and license fees, but may not receive a school board tax break.

“For instance, we can give an incentive to a company creating fifty new jobs, but it will not financially impact the schools,” Johnson said.

He explained the tax incentives offered through enterprise zones do not apply equally to all businesses. Instead, the county examines each business’ situation on a case-by-case basis.

“None of these are a given,” he said of the incentives. “Once a company comes to request to utilize the enterprise zone program, we go through and look at their company.”

Johnson said officials employ a model to ensure each business will provide “a long-term benefit for the county” before any of the tax breaks are offered. The number of jobs created and the company’s total investment in the area factor into the county’s decision to include businesses in the enterprise zone program.

Resolutions for the three enterprise zones to be voted on by the board indicate the county will grant qualified businesses a gradually shrinking exemption from property taxes if the zones are implemented.

According to the proposed resolutions, the county will exempt all of a company’s property taxes for the first five years it operates through the enterprise zone program. For the next two years, the county will exempt 80 percent of the business’ property tax. The county will walk the exemption down by 20 percent each year for the next three years, until the business starts to pay the full amount of its property taxes.

However, each company accepted into the program must continue to pay the portions of its property taxes that fund the school district and general debt obligation through all 10 years of its decreasing exemption.

Commissioner JoAnn Birrell’s district includes an enterprise zone that the county adopted into its code in July of last year.

Birrell said the borders of her district’s enterprise zone were being shifted to include the west side of Canton Road, which is home to commercial properties.

The boundaries circling the road’s eastern side will also be adjusted, Birrell said, to exclude some residential properties that fell within the zone when it was first drawn.

She explained enterprise zone benefits may only be reaped by commercial properties, so the inclusion of residential properties within the zone was unnecessary.

After officials combed the county for properties in need of redevelopment two years ago, Birrell said she discovered 17 of the 38 sites singled out for improvement fell within her district. Thirteen of the blighted properties in that area were concentrated along Canton Road.

“There are some sites on the redevelopment list on both sides of the road,” she explained, “and I think the businesses that would look to relocate or come to Canton Road would benefit from being in the enterprise zone, whether they’re existing businesses looking to expand or new businesses coming to Cobb County or Canton Road.”

The Smyrna-Osborne enterprise zone will differ from Canton Road’s because it requires cooperation between the Smyrna City Council and the county, Johnson said.

The area tucked between Powder Springs and Austell roads, blanketing parts of South Cobb Drive and Atlanta Street, will include properties in both unincorporated Cobb and Smyrna city limits. The joint enterprise zone will represent a partnership between the two governing bodies, Johnson said.

Smyrna’s council will vote on the zone at a public hearing on July 21.

“It’s an incentive to improve some of the blighted areas of that area of Smyrna,” said Councilwoman Susan Wilkinson, who was elected to Smyrna’s City Council in 2011. “We do have a lot of empty buildings and vacant businesses that have closed down. If it could help revitalize that part of Smyrna, that would be a good thing.”

Wilkinson said Smyrna city staff have been working with county staff to prepare to jointly implement the enterprise zone.

She said her understanding of the arrangement would have City Council members reviewing eligible businesses that fall within Smyrna, while county officials would vet applicants operating in the unincorporated parts of the Smyrna-Osborne zone.

“I think it sounds like a positive thing for that area of Smyrna,” Wilkinson said.

The Powers Ferry enterprise zone will encompass parts of the area south of Delk Road and north of Terrell Mill Road.

Johnson said county staff spent four to six months researching whether and where to draw the two newest zones, noting the process can drag on.

“We are always looking at the whole county to see if there’s a way to meet the criteria to see if they can use the enterprise zone program. This is one of the tools we have in the toolbox from an economic development perspective,” Johnson said. “You want to have a lot of different tools to create jobs.

"Enterprise zones are great to help small businesses grow, and it’s great to have a program like this to help small businesses hire more people.”

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June 24, 2014
“enterprise zones” = acknowledgement that TAXES ARE a BURDEN on businesses.

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