City officials look to stimulate downtown redevelopment through State incentives

Adairsville considering application for Rural Zone tax credits


Adairsville Community Development Director Richard Osborne said the City is contemplating applying for a “Rural Zone” designation from the Georgia Department of Community Affairs (DCA) in 2020.

“We’ve looked at a variety of things as part of creating the downtown master plan, and whatever gets implemented in the next year or two, the bottom line is it needs to be both meaningful and realistic, and something that will work for Adairsville,” Osborne said at the Adairsville Downtown Development Authority (DDA) meeting held Thursday evening. “One of the things that was mentioned was the Rural Zone program — which is a State program that does not require an investment of Adairsville taxpayer money.”

The designation, Osborne said, would most likely apply only to the City’s downtown district. If approved by the DCA next year, the Rural Zone designation would take effect Jan. 1, 2021. 

Over a five-year period, private businesses and property owners would be able to apply for State tax incentives in a manner Osborne described as “a layer cake approach” to redevelop buildings and bring new jobs to the area.

“At the bottom is the State job tax credit of $2,000 per year, per new full-time equivalent job. So that is a maximum of $200,000 total, or $40,000 per year,” Osborne said. “Obviously, you can have one full-time and two part-times, or something like that.”

The Rural Zone designation would also include investment credits for individuals who purchase downtown real estate, to the tune of 25% of the purchased property/building price, not exceeding $125,000 over the five-year designation period.

“The rehab credit is 30% of qualified rehab, not to exceed a total of $150,000,” Osborne said. “That credit is to offset development costs associated with rehab of an investor property.”

Despite the name of the program, Osborne said metro Atlanta communities are eligible for the Rural Zone designation, just as long as the total City population is lower than 15,000 people.

“There’s a lot of communities in northeast Georgia that are Rural Zones,” he said. “A comparable city that has it and loves it is Hogansville. It has a lot of similarities to Adairsville.” 

Adairsville City Councilman Lee Castro asked Osborne why the City wouldn’t apply for the entirety of the community to be listed as a Rural Zone under the DCA program, bringing up a blighted area he said Shaw requested the local government to acquire for job tax credits.

“Because it’s for commercial, it wouldn’t make sense to be for residential,” Osborne said. “It’s targeting downtowns, specifically in small cities.”

Each year, the DCA selects a maximum of 10 communities to receive the designation. Bainbridge, Commerce, Cornelia, Jonesboro, Perry and Toccoa are some of the previous recipients of the DCA tax incentives.

“If we continue to have the Less Developed Census Tract designation by DCA, that also makes job tax credits available for new businesses anywhere that employ, I think it’s five, new employees in a year,” said Adairsville City Manager Pam Madison. “That you don’t even have to apply for, it’s just a designation. And it looks like we’ll probably continue that one into next year.”

Applying for the Rural Zone designation, Osborne said, will take considerable time and work from staff, but it doesn’t entail any State fees.

“It potentially takes money out of the State coffers through the State incentives and State credits, but it doesn’t take money out of Adairsville,” he said.

The City, Osborne said, missed the cutoff for 2019’s application deadline. Before Adairsville can officially apply for the designation, he said a downtown master plan and marketing study must be completed. 

Madison said she expects a downtown master plan executive summary to go before the council, with the City’s DDA tasked with creating a five-year strategy to implement said plan. Now, she said, was a good time to start targeting “low-hanging fruit” ahead of the next budgeting process.

“We can put a barrier around the generator behind the police department and do some type of a wrap or something on it to make it look nicer,” she said. “The next step, we’ll also start getting some pricing on lighting down Main Street and what it would cost to bury the power lines, things like that … some things might be too cost-prohibitive, it might be doable. So then we’ll have a little more information.”

DDA board members seemed to agree that Main Street redevelopment and refurbishment was the top priority on a list of about half a dozen master plan items. 

“We already have our engineer looking at the Hambright Building proposal for us to consider as part of the 2020 budget,” Madison said. “Sprucing up Main Street, I think that would go a long way.”

She also floated the idea of potentially giving downtown property owners breaks on municipal service costs to DDA board members.

“We can even offer utility credits, in terms of an incentive,” she said. “It might also be a possibility, if people take advantage of it, to get a rear- or side-facing easement on the buildings as well, just so down the road, those are in place.”