Richmond Hill’s plans to create a tax district to revitalize parts of the city around its older I-95 interchanges could mean millions more in sales and property taxes for the school system if they buy in, school leaders were told last week at a Bryan County School Board work session.
Consultant Ken Bleakly and Assistant City Manager Scott Allison spoke to members of Bryan County Board of Education at the BoE’s Sept. 16 workshop in Black Creek about the city’s efforts to create its first tax allocation district, or TAD.
Bleakly told school board members projections show by its fifth year the “Gateway Corridor” TAD could generate some $845,000 in education special local option sales tax, or ESPLOST, revenue. By the tenth year the TAD could generate an additional $1.9 million for the school district on top of property taxes, and do it without a big hike in student enrollment.
“Overall our conclusion was that the creation of TAD No. 1 would have a significant positive fiscal impact on Bryan County Schools with minimal impact on its enrollment,” he said. The city is asking both the school board and Bryan County Commission to adopt resolutions by Dec.31 agreeing to the TAD, then help form a committee made up of officials from all three boards to decide what projects are feasible. Richmond Hill is looking at the TAD to help revitalize areas around both interchanges while helping them keep pace with projected growth at the Belfast Keller interchange further south.
That 5,000 acre site is already home to a Med-Line industries distribution facility, and the developer, Raydient, is said to be planning to build as many as 10,400 homes over a 20-year period.
Bleakly said property values in the Gateway Corridor increased by 14 percent from 2000 to 2009, but rose by about 1 percent a year from 2010 to 2019. In addition, he said Richmond Hill is losing an estimated $88 million in “retail leakage,” to Chatham County and Savannah, and “that money could be captured and spent in Richmond Hill if we can attract more quality retail establishments to the area.” The city’s voters gave its leaders the power to establish such districts in a 2019 referendum, and the first TAD covers 157 parcels on 567 acres of land along highways 17 and 144 and their respective interchanges with I-95, most of it commercial. Those properties are currently worth about $34 million on the city’s tax digest. Bleakly said projections show redevelopment could increase its value to about $230 million in fair market value – some $81 million of it taxable – within a decade. An effort to diversifying the city’s tax base to help fund infrastructure without putting the cost on the backs of homeowners led Richmond Hill officials to hold the 2019 referendum, which now gives the city the power to use taxes on future growth to help fund revitalization efforts in the TADs.
In past decades much of the growth in Richmond Hill and Bryan County has been residential, which has put pressure on the school system to add classrooms to keep pace with the growth. Bryan County Schools currently has an enrollment of around 10,000 students.
Just a decade ago, it was around 7,270 and that year, the system had a budget of about $49 million. In May, the school board approved a budget in excess of $91 million for the 2022 fiscal year.
At the school board workshop, Chairwoman Amy Murphy asked for a breakdown on how many students the proposed TAD would add under what the city is proposing.
She was told it could be anywhere from about 43 to 76 students over a 10 year period.
“We don’t see this as having a dramatic impact on the schools since most of the development is commercial,” Bleakley said. Soon afterward, he told the BoE what the system could lose if they choose not to participate in the TAD over a 25-year-period – about $42 million in property taxes alone.
“The TAD has real potential to generate a lot of economic growth in a quicker fashion,” he said.
“That’s why the city is excited to get this implemented.”
In a TAD, property owners within its boundaries can participate by offering projects meeting the city’s criteria for redevelopment. When the TAD is formed, the assessed value of the properties within it at that time provide a baseline, and taxes collected on that baseline amount continue to go to Richmond Hill, Bryan County and Bryan County Schools over the life of the TAD
But as improvements are made, property values go up, and so do the taxes – and the additional taxes on improvements in the TAD due to redevelopment are set aside to fund the infrastructure improvements, either on a “pay as you go” basis as the taxes are collected, or to pay back bonds or loans used up front to pay for the improvements, officials say.
There are currently eight “hypothetical” projects listed as part of Richmond Hill’s first TAD, including additional motels, restaurants and other commercial growth around Exit 87 and alongside Highway 17; more medical office space, a professional office park and a Civic Center on 17 where the A-1 motel once sat, among other plans.
The hypothetical projects include more mixed use development at the cross roads west of 17 and at Exit 90.