City approves Lowe's economic development district
The City of Abbeville announced the addition of a Lowe’s Home Improvement store on Charity Street more than a month ago along with the information that the company requested to attach a 1/2 percent sales tax on purchases within the store until they collect $500,000 to offset the cost of the infrastructure development of the site.
In order to accomplish this, the council had to create an economic development district for them.
A public hearing was announced to allow residents of Abbeville to voice their opinion of the district. The meeting, held Tuesday afternoon, brought forth views for and against the district.
First to speak was Brian Crouch.
“This economic development district may be legally okay, but is not in the spirit of what an economic district should do,” he stated.
“I understand this money was promised to Lowe’s before they even moved in. That’s a promise made on behalf of the citizens of Abbeville.”
He continued in that vein stating that the citizens have not had a voice in the decision or a vote. “A tax on the people should have to be voted on by the people and we should have a voice in it. The city council and the mayor work for us.”
Councilman Francis Touchet was opposed to the new district citing that the city has not given concessions of this amount to any other business in the city before.
“Yes, there have been things that have been adjusted before, but I’ll say this; we have never allowed something of this magnitude in which the people don’t have a say so,” Councilman Touchet stated.
“Do you realize what we are doing? We are telling the people, not that they have to go there, but if they do go there, there is not going to be a choice not pay the tax that is going to be implemented.”
In response to Councilman Touchet’s statement that monies or incentives have not been given to other businesses, Councilman Francis Plaisance produced information that in 2006 a concession on utilities was given to Riviana Foods in the amount of $40,000 a year. In addition Stine Lumber was reimbursed more that $20,000 under a rededicated sales tax from April 2003 through November 2004. Wal-Mart also received concessions on utilities for a period of time.
“It is not the first time we’ve given concessions to a business in this city. It is an economic development tool,” Councilman Plaisance stated. “We are not forcing taxes when we vote on this issue on anyone. It is simply a choice whether you want to purchase an item there or not.”
In a later interview, Councilman Plaisance stated that an average purchase of $100 at Lowe’s would have an additional 50 cents due to the 1/2 cent tax.
“According to the way the legislature set this up, it is not required to go for a vote. It is not us, it is the legislature,” he added.
Mayor Mark Piazza addressed the citizens and council and told them that the way the system of government is set up it cannot go to a vote to the people because Economic Development District 1 to be created is the 12 acres in which Lowe’s will sit therefore not having other residents to vote on the issue. “We can’t have a tax election to pass a tax on just one business.”
In addition he stated, “When the Lowe’s company came to Abbeville, who wanted us to give them a half a million dollars out of our own sales tax revenues that we were already collecting.”
He explained that the taxes currently collected are dedicated to services in the city.
“What most other municipalities do is write them a check. Other cities are participating to the tune of $2 million, $2,500,000 or even $3 million,” Mayor Piazza said.
“Do we want this company in Abbeville? This means an additional $400,000 of revenues to the City of Abbeville. There are only three ways to generate revenue for the city. The first is to raise taxes. The second is to raise utility costs. The third is to bring in new businesses that will pay taxes to us. If I have a choice, I pick number three.”
Conversation between citizens and council and mayor continued reiterating each view of the issue.
The hearing ended and during the regular meeting the council voted 4-1 to create Economic Development District #1.
The action voted upon in a special session held immediately after, adopted an ordinance levying an additional sales and use tax of 1/2 percent in the Economic Development District #1 passed 4-1.