A developer still can put a new distribution center in Rock Hill. It just isn’t likely to come with the city’s help paying for it.
Rock Hill City Council approved changes Monday night to the incentive policy it uses to manage growth. The city can award money back from water, sewer or fire impact fees to eligible projects set to bring more jobs or overall economic development. Water and sewer meter fees, along with building permit fees, are possibilities too.
A major change Monday makes distribution center projects ineligible unless they’re “significantly different in character” from typical distribution or warehouse sites.
“(In) likelihood they will not be granted assistance unless there’s some sort of unique situation where they offer significantly higher wages or more employment per square foot than is typical with a distribution facility,” said David Lawrence, Knowledge Park development manager.
Rock Hill isn’t alone wrestling with the warehouse question. York County Council meetings at least as far back as April broached the issue of what businesses, if any, should get tax breaks. Councilwoman Christi Cox is concerned warehouse and distribution centers get credits or tax breaks while bringing in low-paying jobs.
“Some folks call them corporate welfare,” she said in the spring. “I get this question from my constituents. Why are you doing this when the jobs that they are bringing in don’t pay a livable wage?”
Choosing not to offer tax breaks to certain industries or projects isn’t an anti-business stance, she said.
“Every business is welcome here in York County,” Cox said in April. “The question is, at what point and when do we extend tax breaks?”
Rock Hill leaders talked through similar issues Monday. They discussed revised incentive policy on affordable or workforce housing. They talked about the need to offer incentives at all.
“The program is designed to offset financial impacts that may impact a project’s feasibility,” Lawrence said of the almost 20-year program.
Councilman Jim Reno said the program is important because a site can go from approved to clearing for development quickly.
“What we’re trying to do is bridge the gap in development projects that couldn’t occur without the incentive,” he said.
Taking out distribution sites is “a great example of a use that we’re not overly excited about because of the wages,” Reno said. The policy needs updates and review to fit economic conditions, he said.
“A lot of this came forward at a time when the economy was down,” Reno said. “We’re now in a much stronger economy so to me there’s probably more of a need now to better define what bridging the gap is in a lot of areas.”
South Carolina Department of Employment and Workforce data shows York County has more than 4,300 transportation and warehousing jobs. The county has that many more wholesale trade jobs. Warehouse jobs are about a third of what the highest industry, retail, has and less than half of the more than 11,000 manufacturing jobs.
I-77 Alliance data shows the second-largest private-sector employer in York County is Ross Stores, a retail distribution center with almost 2,400 jobs.
The incentive policy is one of several options the city offers to lure new development.
“This is a very narrow scope,” said David Vehaun, city manager. “We’re talking about just a few fees that are even eligible here.”
Smaller changes made the policy revision. It added Knowledge Park as a specific area where it might apply. It made affordable, workforce or mixed-income housing projects eligible. It awards money when the city issues a certificate of occupancy, meaning the new business is ready to move into the space.
One council member didn’t want such a specific policy.
“We want the flexibility to evaluate on a case-by-case basis,” said Councilman John Black.
Council will still have final say.
“City Council retains complete discretion as far as these, for approval or denial,” Lawrence said.
Rock Hill and York County can be an attractive area for distribution centers, located along I-77 and so close to Charlotte and Columbia. The county held a public meeting last week on a new small area plan along the I-77 corridor south of the Catawba River.
County Council also met at least twice this month, including Monday night in a closed-door meeting, to talk about the possible Carolina Panthers facility on more than 200-acre site off I-77 outside of Rock Hill. The city will likely plan to annex the site if the team finalizes the deal to relocate in York County.