PORTERDALE -- The business district of Porterdale has received the Opportunity Zone Tax Credit designation from the state of Georgia, meaning that businesses within the area will receive a $3,500 tax credit for every new job created.
Businesses within the district will be eligible to begin taking the credit for new jobs created in a taxable year which begins on or after Jan. 1, 2012, provided a minimum of two net new jobs are created.
According to the Georgia Department of Community Affairs, businesses which are unable to use the credit against their Georgia income taxes may claim the excess credit against their withholding taxes as long as they follow specific steps to ensure that the credit may be claimed against withholding.
City Manager Bob Thomson said the designation affects between 10 and 15 businesses right now and has tremendous potential for business growth in the city.
"It's a significant amount of money because it's a tax credit, not a write-off," explained Thomson. "I had asked if there was an upper limit to the amount of jobs eligible for the tax credit and the state said they were not aware of a limit. So if somebody created 10 new jobs, that would be a $35,000 tax credit."
Thomson said the entire business district that runs along Ga. Highway 81 was targeted, as was the mill area on Osmundy Street where a twine mill, Specialty Yarns, now operates.
"Obviously we're real excited about it. We'll be meeting with the Covington-Newton County Chamber of Commerce soon to make sure we can utilize this and exploit it fully so the economy in our little town will grow," he said, adding, "We think it's going to be good for Newton County, too. The mayor and the council worked hard to make sure we got the designation."
The incentive is good through 2022, at which time the city will have to reapply for the designation.
"I'm sure we would (reapply) as it's certainly consistent with what we're doing in trying to revive downtown businesses as well as housing," Thomson said, "We think it's going to be a significant tool to help us do that."
Thomson also said Monday marked a long-awaited day in Porterdale history as the Gym Rehabilitation Project officially got under way as workmen began pulling out brick and rubble left inside the walls of the historic gymnasium destroyed by fire in 2005.