JEKYLL ISLAND — The Savannah Economic Development Authority must focus on three major issues if it hopes to improve its competitive positioning, continue to attract investment and create jobs, SEDA president Trip Tollison told his board Thursday during its annual retreat.
“First, we need to work to remove the energy excise tax that puts us at a disadvantage when bringing in investments and jobs,” he said.
“Second, we need to extend the inventory tax exemption on manufacturing from unincorporated Chatham County to include Savannah and Pooler.
“Finally, with Crossroads Business Park at near-capacity, we need to plan and complete a preliminary analysis for a new business park.”
The energy excise tax came about after the Georgia General Assembly in 2012 approved a bill to eliminate the sales tax on energy used in manufacturing and agriculture. As an offset for that lost revenue, the legislature authorized local governments to adopt an excise tax on energy consumption.
In cooperation with local municipalities, Chatham County adopted such a tax, which was effective last month.
The problem, according to SEDA consultant Pat Monihan, is that few other counties in Georgia have followed suit, putting Savannah at a competitive disadvantage.
“Neither South Carolina nor Florida place an energy tax on manufacturers, which poses a recruiting problem for SEDA,” Monihan said in his presentation.
He suggested SEDA approach the county and municipalities asking that the tax — which is to be phased in gradually — be repealed.
Inconsistency in the Freeport Exemption for manufacturing inventory tax also must be addressed, Monihan said.
“All of Georgia’s bordering states exempt manufacturing inventory, as do 142 of 159 counties in Georgia. Unincorporated Chatham County offers the exemption but the City of Savannah and the City of Pooler do not,” he said.
“This makes a huge difference to companies’ bottom lines.”
“This strategy would offset any revenue loss to Pooler or Savannah, while making the megasite and Crossroads Business Park more marketable,” Tollison said.
The move would require approval by voters in a scheduled referendum.
As for the development of a new business park, SEDA has asked the county for $35 million in upcoming Special Purpose Local Option Sales Tax proceeds to acquire, develop and permit the new park.
“Of course, this is assuming SPLOST passes,” he said.
Because no votes will be taken at the retreat, which continues through today, SEDA will take up the issues formally at its Sept. 10 board meeting.