IDB exploring development financing to fix state law
A Lewisburg attorney has offered to draft legislation to resolve a financial situation for the candle factory that just opened in the city's business park on Mooresville Highway.
"Will & Baumer has applied for a Small Business Administration loan," attorney Bob Binkley told the Lewisburg Industrial Board during its March meeting. "To get it, the title for the land must be held by the borrower."
The candle company's development is in conjunction with the Autom church products call center and warehouse. Those three operations have a contract with the city that defers property tax payments.
Therefore, the city holds the title to the property. It's through a PILOT program. A Payment In Lieu of Taxes schedule is established. The schedule waives property taxes during the first year, but increase them by one tenth of the total each year until the full amount is paid.
Binkley is working on a tax financing proposal to have a different process that would qualify a business with a PILOT for an SBA loan, according to discussion among the members of the city's Industrial Development Board.
"We're not the only ones who are caught up on this," Binkley said. "Others are scrambling to make the two (programs) work" together.
Officials in Clarksville are trying to resolve a similar situation, Binkley said.
Currently, SBA loans can't be made to businesses with a PILOT, and no businesses with an SBA loan can enter a PILOT agreement, he said.
"It hit us in the face," the attorney said while seated next to Eddie Wiles, chairman of the IDB.
"I'd have thought this would already have been done," Wiles reacted.
Binkley replied, "Georgia has a PILOT program similar to ours. Kansas and other states do tax breaks differently."
Wiles asked if municipalities can get SBA loans and Binkley said he'd explore that idea.
Lewisburg's IDB meets at noon on the first Monday of each month in City Hall.