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Tax giveaways are not necessary

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POSTED: November 7, 2007 5:00 a.m.

State and local governments should be forbidden by law to offer financial incentives for development north of I-20 and within 50 miles of the Atlantic Ocean.

We know that North Georgia and the coast will grow. Development will come. Not a dime of incentives extracted from taxpayers should be used as a lure in either area.

For example, Great Wolf Resort has announced plans to build a 400-room resort and conference center on 20 acres at Lake Lanier’s Mary Alice Park, including a for-guests-only indoor water park. The city of Cumming pledged $10 million in incentives for the project, the state added $6 million for road work and Forsyth County pledged $5.1 million for road improvements, for a total incentive package of $21.1 million.

(The county doesn’t have the money, but will ask for the $5.1 million in a project list for a proposed special-purpose local-option sales-tax referendum in February.)

Those incentives are absolutely unnecessary. Between 2000 and 2005, Georgia ranked third in the nation in population growth. Nationally, the population grew 5.4 percent; Georgia grew by 11.6 percent, outpacing traditional Sun Belt boom states of Texas (10 percent) and Florida (11.2 percent).

Georgia should always remain business-friendly, but we’re no longer a beggar state and should stop acting like one. The emphasis now should be on managing growth and using financial incentives to direct it to areas where growth is sorely needed.

The state already has a tier system of counties ranked on jobs, income and growth potential. Tier 1 counties are the 71 neediest, based on 36 months of unemployment data, per capita income and the percentage of residents living in poverty.

The second tier are those ranking between 72 and 106. Tier 3 comprises the next 35, while Tier 4 counties are the state’s 18 most prosperous counties. For the most part, Tier 4 counties are in Metro Atlanta and points north. Together, tiers 3 and 4 would include most of North Georgia and the coast.

Taxing existing businesses and residents in hopes of luring businesses from somewhere else is, frankly, a practice that governors across the South should agree to abandon. In rare instances where incentives are essential, the incentives should be reserved for Tier 1 and 2 counties where growth is not assured. Tax giveaways are not necessary in either North Georgia or along the state’s coast, and should be ended.

— Atlanta Journal Constitution

 

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