Source: Sherman Publications

PC recommends twp. adopt tax abatement policy

by CJ Carnacchio

October 19, 2011

Oxford Township planning commissioners are hoping to add one more weapon to the community’s economic development arsenal – tax abatements.

“I don’t care where you stand on the subject, one of the things that should be in your tool box is a guideline for tax abatement policies,” said Commissioner Jack Curtis.

Last week, commissioners voted 7-0 to recommend the township board accept a six-page tax abatement policy pertaining to industrial facilities.

“The first question (any developer or company) that’s coming to a community with state or federal funds (asks) is ‘Does that township or municipality have a tax abatement policy?’ And the answer to that question in Oxford right now is no,” said Curtis, who also chairs the Economic Development Subcommittee.

Curtis believes not having a policy is a hindrance to the township when competing with other municipalities for companies looking to open a new facility or relocate from elsewhere, especially those that are either seeking or have secured government funding to do so.

“Everybody’s telling us you’ve got to have one just to play in the game,” he told this reporter. “This guideline would be in place so that prospective developers can at least tell state (or federal) authorities, ‘Yes, they do have a tax abatement policy.’ Whether or not an abatement is given, that’s still up to the township board.”

“We have a couple people on the board that are vehemently against tax abatements, but that shouldn’t be an argument (against having a policy in place),” he explained. “When a developer goes to look for funds, we don’t want Oxford Township to be at a disadvantage (when it comes to) allowing them to get state funds or state loans or state grants to come to our community.”

The proposed policy’s goals are to expand the township’s industrial base, encourage investment in the community, create new jobs and provide economic stimulus to other private sector facilities.

“We tried to develop something simple based on other communities,” Curtis said. “It’s fairly understandable and easy to use.”

A review committee – consisting of the township supervisor, a representative of the Economic Development Subcommittee and a township resident who represents the business community – would be established to evaluate all tax abatement applications and make recommendations to the township board, which would retain the final power to approve or deny all requests.

Under the policy, the committee has up to 30 days to review each application, unless given an extension by the township board.

The committee would review and judge each request based on the proposed policy and a scoring system that helps determine whether the establishment of a tax abatement district should be recommended and if so, how long the abatement should last.

This system gives points for things like job retention, new jobs created, quality of new jobs (average pay, benefits, etc.), project value, local impact of business (traffic, noise, odor, aesthetics, etc.), and type of industry.

The highest score possible is 235 points.

Those who score 75 points or less would not be eligible for a tax abatement under the proposed policy. Those who score 76 points or more would be eligible for tax abatements on real property lasting up to 12 years and on personal property up to six years.

“We tried to make it a fair and equitable measuring device,” Curtis said.