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Peach State Bank seeking tax incentives for additional office space in downtown Gainesville
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Peach State Bank is applying for Midtown Tax Allocation District funding with Gainesville to convert this building into extra office space. - photo by Scott Rogers

Peach State Bank is expanding its presence in downtown Gainesville, and its new space could receive some tax incentives from the city. 

The bank is applying for funding from Gainesville’s Midtown Tax Allocation District, which allows developers to use property tax payments toward improvements on the property itself. 

Peach State Bank has purchased the lot at 332 Spring St. Southwest, which has previously housed North Georgia Auto Glass and a gas station.  

Steve McKibbon, a board member for the bank, said Friday, Aug. 28, that Peach State Bank is outgrowing its Washington Street building adjacent to the new property. The bank hopes to use the new space as an office for its mortgage operations, he said. 

McKibbon added that the bank wants to preserve the historic character of the Spring Street building. 

“Several of us just couldn’t stand the thought of destroying this piece of history of Gainesville and wanted to repurpose this building to move our mortgage operations,” McKibbon said.  

The bank purchased the property for $400,000 and plans an additional $291,000 in improvements. The bank has asked the city for $83,315 in TAD incentives to offset costs for several portions of the project, including demolition, parking lot lighting, sidewalks and other site work.  

Assistant City Manager Angela Sheppard said Thursday that the Hall County Tax Assessor’s Office told city staff the estimated the value of the property would be $325,000, with the improvements.  

The property was most recently assessed at $182,100, according to tax records. When a property is developed, its value is expected to increase, so its property taxes would go up. Developers who participate in the TAD can use that tax increase to their advantage, with extra dollars from the increase going into a fund that can be used to pay for improvements. 

Sheppard said city staff decided to consider Peach State Bank’s investment in its recommendation for funding.  

“It should at least value out what they purchased the property for. We looked at the numbers from a $400,000 valuation,” she said. “Based on that $400,000 valuation, it generates $48,000 (in additional property tax payments). There is speculation that it could grow in value over time, so we also looked at the numbers if it grew in value up to $500,000, and that would generate about $63,000 (in additional property tax payments).” 

City staff recommended Peach State Bank receive $48,000 in funding upfront for demolition, site work, landscaping, parking lot lighting and sidewalks. That upfront lump sum would be paid back through property tax payments. Then, after the $48,000 has been replenished in the TAD fund, the bank can keep any remaining increment generated over the next 15 years or when they have received a total of $63,540, whichever comes first. 

The city’s TAD committee approved that staff recommendation Thursday. The Gainesville City Council will have the final vote at a later meeting. 

Hall County Administrator Jock Connell, a committee member, said he disagreed with the staff recommendation’s departure from the Hall County Tax Assessor’s estimated value of $325,000. Hall County Commissioner Jeff Stowe said he agreed with Connell’s statement, and both voted in opposition. 

The two committee members who represent Gainesville City Schools, Superintendent Jeremy Williams and Director of Finance Kathy Pethel, abstained from voting. Andy Stewart, chair of the school board, is part of the bank’s leadership, and the school system has accounts with the bank, Williams said. 


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