By Jim Hicks
Lady’s Island is, once again, in the process of change.
Over the years it has been the subject of a transition from a rural and somewhat isolated community to a popular residential community.
Today it is undergoing a shift in the nature of its commercial area from small, individually owned businesses serving local island residents to a retail center hosting national chain stores and attracting customers from all of Northern Beaufort County.
In making its decision to establish a super center on Lady’s Island, Walmart looked at the 33,000 residents living in 14,000 homes within 5 miles of the Lady’s Island Airport.
Obviously this data was a factor in Publix deciding to expand its store on the island as well as the Harris Teeter decision to locate on the island. Most of the customers will arrive at these new stores via their family car.
However, with a new apartment complex, a new assisted living complex in the planning stage and the fact that sooner or later the Whitehall property will eventually be developed, the walking portion of the commercial center will require an upgrade to include basic things such as streetlights, trash cans and landscaping.
The question of who should pay for these improvements will quickly arise.
Perhaps it is time to consider the establishment of a Tax Increment Financing (TIF) district again on Lady’s Island.
A TIF district freezes the tax on property within a designated area and all future increases in taxes goes into the TIF pot to repay loans/bond.
Technically, according to South Carolina law, tax increment financing districts are designated to provide funds to municipalities and counties for programs which correct or improve conditions in “blighted” areas.
In 1999, when the zoning for Lady’s Island was being drafted, the establishment of a TIF district appeared to be a way to financially assist in the development of the Village Center portion of the island. Since portions of the area surrounding the Village Center appeared to meet the criteria for a blighted area, a consultant was provided to the Community Preservation Committee for development of a Lady’s Island TIF district.
A part of this process was projecting what type and how much development would occur in the designated TIF district.
In April 2001, based on this projected growth, Beaufort County Council authorized the establishment of a Lady’s Island TIF District with a maximum limit of approximately $1.5 million.
South Carolina law limits the existence of a TIF to five years, at which time if it is not activated the governing body which established the TIF, in this case Beaufort County, is required to officially disestablish it.
In the case of the 2001 Lady’s Island TIF, before any money could be borrowed or projects started, the city of Beaufort sued Beaufort County due to the fact that the property where the Dockside is today was in the city and they desired more of a say in how the TIF funds would be spent.
The lawsuit was finally settled out of court but did delay any action with TIF funds for a good period of time.
Key to the success of the Lady’s Island TIF was the projected development of the Whitehall property and the development of property in the vicinity of the Dockside restaurant.
Simply stated, these two key developments did not occur and the Lady’s Island Community Preservation Committee deemed it inappropriate and unfair to the Beaufort County taxpayer to request the activation of the TIF until there was some degree of certainty that sufficient development would occur to allow repayment of the TIF bonds.
In April 2006 the TIF had collected approximately $350,000, which was insufficient to support a significant bond issue and at that time the Lady’s Island Tax Increment Financing District was allowed to expire.
If there were any lessons to be learned from the first Lady’s Island Tax Increment Finance district they should include (1) any TIF on Lady’s Island should be a joint county and city of Beaufort effort and (2) be relatively certain that growth is going to occur.
So should a joint county and city of Beaufort Tax Increment Finance district be established on Lady’s Island to fund the overall upgrade of the commercial section of the island?
Two factors would appear to support a serious evaluation of such action.
Over the next five years, the probability of significant commercial growth in the Village Center is much higher than it has ever been in the past.
Thanks to the existence of the Northern Regional Plan, which promotes cooperative efforts between the county and the municipalities, a joint TIF would appear possible.
Surely it is worth evaluating.
Jim Hicks is the chairman of the Lady’s Island Community Preservation Committee.