Downtown Orangeburg may see more private investment thanks to a federal tax incentive program creating “opportunity zones,” city officials say.
“Our entire segment of Russell Street is an opportunity zone, and that’s a big deal in terms of investors, buildings and so forth,” Deputy City Administrator John Singh stated.
During Tuesday’s Orangeburg City Council meeting, council was informed that the downtown area is included in one of two opportunity zones in Orangeburg County.
Opportunity zones are a “federal tax incentive program to encourage long-term private investment in low-income communities. Opportunity zones can, however, be located in affluent communities that have some sense of census tracts that are low-income tracts,” City Administrator John Yow said.
“It’s designed to promote economic development in parts of the state that have not shared in the prosperity over the past several years. It can be used for many things. It can be used for private investments in businesses, housing and even infrastructure,” Yow said.
According to scopportunityzone.com, there are two such zones in the county, one encompassing parts of the city of Orangeburg and Rowesville, and the other encompassing Holly Hill and surrounding areas.
Yow noted that both the county and city wrote Gov. Henry McMaster, requesting that certain areas be deemed opportunity zones, and the requests were fulfilled.
Yow noted that some of the requested areas include city-owned property at the Orangeburg Municipal Airport, as well as downtown Orangeburg.
The tax incentives offered to investors is based on the number of years they invest in the zones.
“The program allows an investor to invest unrealized capital gains in census tracts that have been approved as opportunity zones. What that means is an investor can shield capital gains from federal taxes by investing in these communities, and depending on how long they invest in the community, they can gain or realize further tax incentives,” Yow said.
“If they hold their investment five years, I believe it’s 10 percent. At least seven years is 15 percent, and then if they hold it longer than that, the new gains in whatever they invested in our community would not be taxed,” Yow stated.
Singh stated that being in an opportunity zone offers an advantage over cities that don’t have such designation, but that the city must make an effort to recruit investors.
“The investors choose you,” he said. “It’s a not a situation where we can pick them.”
Singh noted that some investors are more interested in big markets and large cities, while other investors may be looking at developing or rural areas.
Singh said that the city has developed a plan to attract investors that are interested in areas like the city.
“It’s really a three-pronged approach that we’re looking at to help get information and get people looking at our zones,” Singh said.
“Number one is a prospectus,” Sing said. He said the prospectus will give investors “the facts and what we have going on.”
Next will be developing a web presence regarding the zones, Singh said.
The third approach will be “getting that to investors and also brokerages that direct those investors in what they’re doing,” he said.
“The S.C. Department of Commerce just put out a grant opportunity. We actually have applied for a grant to work on a prospectus. We’re going to tell the story of what we have available. We talked about inventory, it’ll be something we’re going to work on with DPU and other partners to develop that,” Singh said.
Singh said the city will work with the county and other entities within Orangeburg County to attract investors because it is a team effort.
“What we’ve got to do is find a way to pair investors to say here’s what we have, and here’s how you can help or here’s what you can do,” Singh stated.
Also during the meeting:
• Reyne Moore, president of the Orangeburg County Chamber of Commerce, gave the council an update on the chamber’s events.
Moore reported that a date or time hasn’t been set for the Christmas parade. The chamber will be conducting a poll and a date and time will be determined no later than March 15.
The chamber will be participating in the Local Entrepreneurs Acceleration Program, Moore said. The program provides participants with information on accounting, finance, business plan writing and how to pitch business ideas to potential investors. The contest features a $10,000 capital award for the winner.
She also noted that the Festival of Roses will be held May 3-5.
• Council heard two individual requests for water service from the Department of Public Utilities.
Terry Benton of Cope requested water service for his property located approximately 16 miles outside of the city limits. Benton stated that the property currently uses well water. Benton stated that his brother, who owns adjoining property, will not agree to DPU’s annexation covenant, preventing him from getting water service.
Walter Curry also appeared before the council making the same request. Curry stated he is developing property located on Shillings Bridge Road, 12 miles outside of the city limits, into a community park. Curry stated that some of his siblings won’t agree with the annexation covenant, which prevents him from getting water service.
According to DPU documents, individuals or entities requesting water services outside of the city limits must have 100 percent approval from all owners of the property, and all owners of adjoining property, to be annexed into the city under the annexation covenant.
• Jeanette Jeffrey complimented the Department of Public Utilities for its customer service.
• Clay Fowler of Longwood Plantation and John Hostetler of Empower Solutions requested council consider adopting an ordinance for a fire sprinkler tax credit. The tax incentive provides a tax credit to properties that install non-mandated fire sprinkler systems.
• William Green expressed concerns regarding skateboarders in the downtown area. Green said that he was “nearly knocked over” by skateboarders while walking on the sidewalk in the downtown area. Green, who stated he skateboards himself, suggested that the city should look into building a skate park.
• Council proclaimed “dependability” as the character trait for March 2019.