Hardin Fiscal Court had the first reading of two taxing ordinances Tuesday related to the industrial property often referred to as the Glendale Mega Site.
The first ordinance is related to the creation of an industrial taxing district and the imposition, administration and payment of a special ad valorem tax. The second ordinance then relates to creating an occupational tax within the industrial and commercial taxing district and the administration and payment of the tax.
According to Judge-Executive Harry Berry, the Glendale Mega Site was created some 20 years ago when the state was courting Hyundai Motor Co. to select the site for a new automobile manufacturing plant. Hyundai ultimately selected Alabama for its project.
For two decades, Berry said numerous prospects have considered the Glendale site for a major manufacturing project. However, to date, the site is unoccupied.
“Over those years many improvements and enhancements have been accomplished to help attract potential development. Environmental studies and mitigations have been accomplished. Soils testing performed; land cleared; utilities constructed to the site – water and sewer to be specific. And plans have been developed, and money is being sought, to construct a new I-65 Interchange near the site,” Berry said at the meeting. “These initiatives were taken to alleviate concerns and questions raised over the years by potential clients.”
Berry said a project of the size will be attracted to this site will require local incentives and concessions in addition to those provided by the state of Kentucky. He said local incentives normally come from rebating, for a specific number or years, a portion of the occupational tax derived from the project.
“We are all also aware that Hardin County does not have an occupational tax. It is difficult to rebate something that you don’t have,” Berry said. “Increasingly, potential clients considering the Glendale site are asking about local incentives.”
Berry said almost 20 years ago the Kentucky General Assembly approved legislation, relating to economic development projects creating 500 or more jobs, that allows for the establishment of a taxing district to levy taxes to help pay for the establishment, operation, and maintenance of government services in the district that exceed the level of services the county provides in other areas of the county. He noted these taxes are an additional special ad valorem property tax and an occupational tax applied within that taxing district only.
The two ordinances prepared by Hardin County Attorney Jenny Oldham for Fiscal Court’s consideration of first reading Tuesday creates the taxing district, lays out the boundaries, and establishes the tax rates, Berry said.
Generally, Berry said the taxing district will encompass the area surrounding the Glendale Industrial site.
“The existing unincorporated town of Glendale is not included in the proposed district,” he said. “The taxes imposed by these ordinances will not apply to residential and agricultural property.”
The additional ad valorem property tax, 10 cents per $100 of assessed valuation, will apply only to commercial, industrial and telecommunications property, Berry said.
The occupational tax applied within the boundaries of the taxing district will be at the rate of 1 percent on all wages and compensation paid for all work done, and services provided, in the district and the net profits from business conducted in the district, he said. Exclusions to paying the occupational tax include employees of common schools, agricultural businesses and home-based businesses – as defined by the ordinance. Other exclusions also are listed in the ordinance.
“The intent is to tax the commercial and industrial growth related to the Glendale Industrial site and not to unduly burden the residents, farmers, and home businesses of the community,” Berry said.
These ordinances will take effect in January 2022 unless otherwise amended. A public hearing and second reading are scheduled for the June 22 Fiscal Court meeting.