A plan to designate Gainesville’s downtown and midtown districts might provide tax breaks for business owners.
The city has applied to become part of the state Department of Community Affairs “opportunity zone” program, which provides tax credits to businesses for creating new jobs in areas the state considers blighted.
The City Council held a public hearing Tuesday on its plan to redevelop the area that includes downtown and midtown, an area the redevelopment plan states is underused and filled with low-income residential units, vacant properties and “historic treasures that have not been maintained.”
Though no one made comments for or against the plan Tuesday, the public hearing put city officials one step closer to designating the area as an “opportunity zone” they hope will provide incentives for development there.
City officials have already made efforts at providing incentives for development in the downtown and midtown areas.
In 2006, the city deemed the 270-acre area of the city a tax allocation district so it could use tax increment financing to help fund redevelopment.
Assistant City Manager Angela Sheppard said making the area an “opportunity zone” could be another tool to spur redevelopment in the districts.
The program would provide the state’s maximum tax incentives for job creation, giving employers a $3,500 tax credit per employee for creating a minimum of two new jobs. The tax incentive would apply to both new and existing businesses of any kind.
The credits would offset some or all of a business’ tax liability and its state income tax withholding.
“Normally in Hall County. you would have to create a much higher level of jobs and your tax credit would not be as high,” Sheppard said. “So if you were to do a business in somewhere that’s not an opportunity zone, then all of those benefits don’t apply to you.”
The commissioner of the state Department of Community Affairs first must approve the district as such.
Rules for the state program require that the poverty level in or adjacent to the proposed area must be 15 percent or greater and near where an urban redevelopment area exists.
After Tuesday’s public hearing, Sheppard said she hopes the city will receive a response from the state “fairly quickly.” The city originally applied for the program in February.
Already, the state department has approved one or more “opportunity zones” in at least 26 communities,” according to the Department of Community Affairs website.