Barrow could be big winner in Caterpillar deal
Friday, March 2. 2012
The big winner to come out of last week’s announcement of a large Caterpillar manufacturing plant to be built on the Clarke-Oconee line could be Barrow County. Barrow has long struggled with a lack of industrial development. Although the county has a large swath of Hwy. 316 and a small part of I-85, it has not been able to attract the kind of industrial growth many would like to see.
But with the Caterpillar plant coming just across the county line, Barrow is poised to possibly get many of the spinoff suppliers for that facility. And that may prove to be a better deal for Barrow than Caterpillar will be for Clarke and Oconee counties.
The reason for that is that Clark and Oconee are spending an insane amount of local tax dollars to get the facility. The AJC reported Sunday that the two counties will spend nearly $18 million up front to buy the land and put infrastructure in place for Caterpillar. Then over the next 20 years, the two counties are abating another $12 million in tax revenue. The plant will only pay 10 percent of its property taxes the first three years, then phase in to 100 percent over 17 years.
According to an ABH report, Oconee County is borrowing $10 million to make the deal happen and Clarke is issuing $6 million in bonds.
That Caterpillar is bringing 1,400 jobs to the area is notable. It’s a large plant that should bring in spinoff businesses. But those jobs and spinoffs will only come over time. So one has to wonder when, or if, either Oconee or Clarke will ever see a full return on their investment. Will that facility ever be worth the huge amount those two counties are spending?
Many people are against public tax incentives for large plants. While incentives are part of the industrial development “game” today, there are limits to what a local community should offer. Financially, not all of these deals work out. Caterpillar, for example, often expands and contracts according to the worldwide economy. It closed a facility in nearby Jefferson early in the recession. There are no long-term guarantees with any of these large industrial deals.
But there is a tremendous amount of pressure from state officials being put on local communities to do these kinds of big incentive packages. For state leaders, it’s all about winning, being able to claim they are “creating jobs for Georgians.” State officials don’t care how much a local community puts into a deal because they don’t have to pay it back. Those payments come out of the pockets of local taxpayers.
Undoubtedly, the state put a lot of pressure on Oconee and Clarke officials to make the Caterpillar deal happen and both communities are committing a large amount of local tax dollars to the deal.
So financially, it’s a good thing that Caterpillar isn’t locating in Barrow County and that local taxpayers aren’t being asked to pay millions of tax dollars for such a facility. In fact, Barrow probably couldn’t afford to offer such an incentive package, nor would that kind of huge incentives deal get much public support here.
But since the new plant is locating at the edge of the county, Barrow could benefit greatly over the long term without having that debt. It just makes sense that suppliers to the new plant would have Barrow very high on their potential location list.
In addition to the potential to lure spinoff facilities, the plant could provide some much needed manufacturing jobs for Barrow County citizens. Both Clarke and Oconee counties have low unemployment rates, so many of Caterpillar’s jobs will come from the surrounding area. Barrow citizens could benefit from that, especially if the Barrow County School System and Lanier Tech can coordinate with Caterpillar for specific training programs.
This is a major opportunity for Barrow County, one that could help the community pull out of its economic doldrums caused by the housing bust. Barrow’s economy was too dependent on the housing and real estate sector and a diversification of employment into manufacturing would be good for the community in the long run.
But to take advantage of this opportunity will require strong leadership in Barrow County, leadership that is now lacking at the county level. That will hopefully change with this year’s elections and the implementation of a new county manager government in 2013.
While there are some in Barrow County who wish this community could have lured Caterpillar here, it’s probably good that it’s not being built in Barrow. Clarke and Oconee are putting up $30 million over 20 years, more than half of which is upfront debt. Barrow simply could not have afforded to play that kind of high-stakes game.
But Barrow can still be a winner if it gets the right leadership at the county level to take advantage of the plant’s proximity.
Caterpillar could be a boon for Barrow County, if our leaders don’t blow it.
Mike Buffington is co-publisher of the Barrow Journal. He can be reached at mike@mainstreetnews.com.
The reason for that is that Clark and Oconee are spending an insane amount of local tax dollars to get the facility. The AJC reported Sunday that the two counties will spend nearly $18 million up front to buy the land and put infrastructure in place for Caterpillar. Then over the next 20 years, the two counties are abating another $12 million in tax revenue. The plant will only pay 10 percent of its property taxes the first three years, then phase in to 100 percent over 17 years.
According to an ABH report, Oconee County is borrowing $10 million to make the deal happen and Clarke is issuing $6 million in bonds.
That Caterpillar is bringing 1,400 jobs to the area is notable. It’s a large plant that should bring in spinoff businesses. But those jobs and spinoffs will only come over time. So one has to wonder when, or if, either Oconee or Clarke will ever see a full return on their investment. Will that facility ever be worth the huge amount those two counties are spending?
Many people are against public tax incentives for large plants. While incentives are part of the industrial development “game” today, there are limits to what a local community should offer. Financially, not all of these deals work out. Caterpillar, for example, often expands and contracts according to the worldwide economy. It closed a facility in nearby Jefferson early in the recession. There are no long-term guarantees with any of these large industrial deals.
But there is a tremendous amount of pressure from state officials being put on local communities to do these kinds of big incentive packages. For state leaders, it’s all about winning, being able to claim they are “creating jobs for Georgians.” State officials don’t care how much a local community puts into a deal because they don’t have to pay it back. Those payments come out of the pockets of local taxpayers.
Undoubtedly, the state put a lot of pressure on Oconee and Clarke officials to make the Caterpillar deal happen and both communities are committing a large amount of local tax dollars to the deal.
So financially, it’s a good thing that Caterpillar isn’t locating in Barrow County and that local taxpayers aren’t being asked to pay millions of tax dollars for such a facility. In fact, Barrow probably couldn’t afford to offer such an incentive package, nor would that kind of huge incentives deal get much public support here.
But since the new plant is locating at the edge of the county, Barrow could benefit greatly over the long term without having that debt. It just makes sense that suppliers to the new plant would have Barrow very high on their potential location list.
In addition to the potential to lure spinoff facilities, the plant could provide some much needed manufacturing jobs for Barrow County citizens. Both Clarke and Oconee counties have low unemployment rates, so many of Caterpillar’s jobs will come from the surrounding area. Barrow citizens could benefit from that, especially if the Barrow County School System and Lanier Tech can coordinate with Caterpillar for specific training programs.
This is a major opportunity for Barrow County, one that could help the community pull out of its economic doldrums caused by the housing bust. Barrow’s economy was too dependent on the housing and real estate sector and a diversification of employment into manufacturing would be good for the community in the long run.
But to take advantage of this opportunity will require strong leadership in Barrow County, leadership that is now lacking at the county level. That will hopefully change with this year’s elections and the implementation of a new county manager government in 2013.
While there are some in Barrow County who wish this community could have lured Caterpillar here, it’s probably good that it’s not being built in Barrow. Clarke and Oconee are putting up $30 million over 20 years, more than half of which is upfront debt. Barrow simply could not have afforded to play that kind of high-stakes game.
But Barrow can still be a winner if it gets the right leadership at the county level to take advantage of the plant’s proximity.
Caterpillar could be a boon for Barrow County, if our leaders don’t blow it.
Mike Buffington is co-publisher of the Barrow Journal. He can be reached at mike@mainstreetnews.com.
The Granite hotel is a good start, but there are abandoned chicken houses and buildings like the old Pet Milk location all over that need to be dealt with. Make the owners responsible and fine them if they don't clean up or tear down.
Alot of the comments here are just piles of negative crap, no action, just talk about what you think is wrong, and how you don't like it. It gets old. Complain much, How about YOU Volunteer? help clean something?
I also agree that a good cleanup would be in order. It's so bad that you don't need county line signs to know you are in Barrow County. Give some teeth to code enforcement and, if a citizen calls in a complaint, allow them to do so anonymously to protect them from retribution.
Winder could be dressed up too. Other cities around us have done it. Of course, those business owners were willing to put up money to spruce up their towns and I haven't found that to be the case in Winder. Perhaps the new Winder government can investigate grants, matching loans, etc. to get the job done.
"Could have"
"Should have"
"Wound have"
So many opportunities lost on a BOC more interested in its "own" no matter the cost to the County.
The county turned up its nose at Chateau Elan and it million dollar homes and all the commerce that came with them.
By its own Web site
"“Barrow County, the place to live, work, play, and retire, a people involving themselves in their community, a people believing in balanced, quality growth and support for services and infrastructure, and a place where taxes are a shared cost of living "
It shows a socialist bent "believing in balanced, quality growth... shared cost of living" to control every aspect of commerce in the county.
Why would any business invest in a County where they would run the risk of offending their sensibilities and have their investment destroyed?
The free market is a simple concept... The Market determines growth not the politicians.
Its funny but in response to complaints from UGA parents about all the bars in downtown Athens (the reason for its commerce), I remember hearing a Athen's Commissioner saying "Its a Free Market... The Market will determine who succeeds and who fails"
vs
Danny Yearwood's statement about the state licensed adult care homes "I wouldn't like them in my neighborhood..." after the courts told the county to get out of yet another small businesses ability to provide a service in demand by the Market.
I guess the Market has determined who will succeed and who will fail...
Maybe a better motto for the County...
"Governments first duty is to protect the people not run their lives" Ronald Reagan
Nobody is going to go downtown. The city keeps it's head you know where. There has been absolutely nothing to aleviate the traffic problem there in I know 30 years.
And you are right about the trash. Travel any road into Barrow and start looking at the trash along the road sides. No excuse. You hear the excuse that it is a State route and there responsibility...well maybe, however, you wanted to be a city, now clean up the damn place. We've got prisioners sitting in the local jail that could and would love to get out to clean the roads and any other beautification projects needed....just to get out awhile.
You say the courts won't let them work on the roads...fine, lets replace the Judges at election time that will allow it. In Georgia...all Judges have to run for election. Even the State Supreme Court.
You say we don't have the resources? BS, what's it costing us in business and potential lost businesses locating here after traveling into this county and seeing this mess all along the road sides and downtown.
City leaders, it's time to grow a set and put pressure on downtown violators and get this place cleaned up.
All the ramshackle houses and businesses need to be torn down or their appearance greatly improved. The owners of these properties need to be held accountable.
The condition of the property is a temporary thing. In a Free market, all property values increase because of the profit potential in the economy is "Driven by" Not "Dictated by" "the Connected and There Puppets." When the land is worth more
the Slum lord will sell out and the property owner will move in...
The condemned property will be raised to be replaced with the new...
The empty store front will be filled with the merchant who's service / goods are in demand. Not the over priced junk pushed by the connected...
Barrow's problem isn't the lack of a sewer...
Its the fear of the new comer and their wealth. What are the leaders protecting when they say "Got to run off... Gona have them peddle their wares down the road..."
Winder / Barrow has trash, empty store fronts, no sewer, slum lords because the connected and their puppets only look out for their "own" no matter how much it costs.
Crony capitalism is believed to arise when political cronyism spills over into the business world; self-serving friendships and family ties between businessmen and the government influence the economy and society to the extent that it corrupts public-serving economic and political ideals.
On Crony business leaves and Winder folds
Rather than seeing the glass as half-empty, try seeing it as half full.
GET some of those JOBS, Attract the Employees to Move and Locate here, SPend here, Employ Here. DO IT.