The Savannah Economic Development Authority on Tuesday updated its board on the progress of efforts to remove the inventory tax for companies located in Savannah and Pooler, a priority the organization set in September.
“Last week, Savannah City Council agreed to put the exemption on the May 20 ballot for voters to consider, which is a huge step,” SEDA president Trip Tollison told his board.
Many Georgia counties, including unincorporated Chatham, already exempt property taxes up to 100 percent of a company’s qualified inventory, including raw material, work-in-process and finished goods destined to be shipped out of state, Tollison said.
“The cities of Savannah and Pooler do not, which creates a significant disadvantage for companies located within their boundaries,” Tollison added.
Among those companies is equipment manager JCB in Pooler, which paid $100,000 in inventory taxes in 2012.
“That’s $100,000 we could have spent on jobs or training,” JCB’s Ken Bianco said last fall.
Indeed, Gulfstream Aerospace officials have said the company would not have been able to locate its major expansion project here had the city not agreed to de-annex portions of the airport property, thus freeing the business jet manufacturer of taxes on billions of dollars in inventory.
If approved by voters, city officials would then decide how to phase out the tax, which brings about $1.6 million into city coffers annually. Tollison said city officials indicated they were considering a 20-percent phase-out over five years.
Competing cities that are 100-percent inventory tax exempt include Atlanta, Macon, Columbus, Augusta, Charleston, S.C. and Jacksonville, Fla.
In other business, Dr. Phil Malan, dean of the Savannah campus of the Mercer University School of Medicine, updated the board on the school’s expansion plans in Savannah, which include increasing the size of the student body from 40 graduates a year to 60 and expanding school’s building on the Memorial Health campus.
Since 2008, Mercer medical students have been able to complete all four years in Savannah, Malan said. He estimated the annual economic impact to Savannah at $20 million.
The SEDA board also heard a report from World Trade Center Savannah chairman Eric Johnson and vice president Brynn Grant on the center’s first year of operation.
WTC successes included securing the city of Savannah as a founding partner and supporting the mayor in her international efforts; partnering with three regional development authorities, exceeding revenue goals by 133 percent, helping regional companies connect with international clientele, supporting the international efforts of the Georgia Department of Economic Development, assuming the role of grantee for Foreign Trade Zone 104 and adding two new subzones; offering 14 regional educational programs, hosting 15 international delegations and planning three international business development missions for SEDA.
