Manufacturing and Fee-in-Lieu of Property Taxes
Industries investing at least $85 million in South Carolina may negotiate for a fee-in-lieu of taxes, resulting in a savings of about 40% property taxes otherwise due. If at least 200 full-time jobs are created, the minimum investment is $60 million. If 300 jobs are created, the minimum investment is $40 million. If 400 jobs are created, the minimum investment is $20 million.
The project must be financed with taxable industrial revenue bonds and structured as a purchase-leaseback. The county holds title to the fee assets.
A corporation or partnership must make the minimum investment over a five-year period to qualify. Any investments after the five-year period are considered taxable property and subject to property tax. However, a county may grant an additional two years for a total of seven years to complete a project. The minimum investment must be met within five years.
The assessment ratio can be negotiated down from 10.5% to 6%. The agreement can extend over 20 years. The county and the fee payer may enter into a millage rate agreement which would set the millage rate for the entire agreement period. Payments of the fee can be structured in any way acceptable to both the county and the fee payer.
Manufacturing Frequently Asked Questions