From the Anderson Herald-Bulletin:
Several government bodies are preparing to vote on whether to provide $3.25 million to Greenville Technology Inc. to build its new plant at the Flagship Enterprise Center.
That money was offered as an incentive to the company to build its $21.5 million plant in Anderson and create 325 jobs.
That offer is possible because the city has a healthy tax increment financing (TIF) district and levy, said Otto W. Krohn, an executive partner with financial O.W. Krohn and Associates. He was hired by the city to analyze its TIF districts.
Greg Winkler, the city’s economic development director, said he has spoken to several people on the Economic Development Commission, Anderson City County and Anderson Redevelopment Commission — all who have to vote on the incentive — and most have expressed support.
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As long as all the parties vote to approve the incentive for GTI, the city will move $3.25 million in TIF funds to an escrow account, which means that GTI can access it only after certain agreed-upon conditions are met, Winkler said.
GTI must first spend $3.25 million of its own on the construction of GTI Anderson facility to use the TIF funds, he said.
The city will then issue bonds, and the sales of those bonds will replenish the TIF levy so money can be available for other projects that come along. That should take three to six months, Krohn said.
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Krohn said he expects the city will collect $200,000 to $500,000 annually from GTI taxes that will go toward paying off the bonds and into the TIF levy. In a matter of 11 years, about $4.3 million will be collected, he said.
At the district’s current state, Krohn said the city is expected to receive around $6.6 million annually from the consolidated TIF district. That’s not counting what will come from GTI or future developments.
During the first tax distribution this year in May, about $3.15 million was collected for the TIF fund. A second installment will come in the fall.
The city has $25 million in total TIF obligations, which is what it owes on loans taken out for various projects, Krohn said. To pay off those debts, the city must make annual payments of about $2.6 million for at least 10 years throughout the varying lifetimes of the bonds.
Some of the bonds will be paid off over the next couple years, meaning the annual payments will decrease.
The last bond of the current bonds will mature, or will be paid off, in 2026.
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http://heraldbulletin.com/business/x1236707353/Andersons-TIF-fund-can-handle-GTI-incentive
