Enterprise Zone may Expand, If Given County Blessing

Businesses in Olde Towne that are renovating or building new could be getting an economic boost.

If the County Council approves it on Friday, the Olde Towne Enterprise Zone could expand to more than twice the size of State recommendations.

Last week Assistant City Manager Tony Tomasello sent a letter containing the city's economic impact statement to the County Executive staff and the County Council, urging them to accept the changes.

With the expended zone, which now stretches around the intersection of Summit and Diamond Avenues, more businesses would be able to take advantage of waived development impact fees to renovate or build in the economically floundering Olde Towne.

But the City's application to the County, and ultimately the State, is on a tight deadline, Tomasello said. The State's deadline to receive the County's to recommendation is this Friday, Oct. 15.

The Council will vote on the measure tomorrow.

Still, the question remains whether the County would be willing to potentially give up tax revenue by expanding the zone.

If Tomasello's numbers are correct, the expansion would bring in enough new students to the area that it would be a "zero sum thing," he said.

A County staff analysis estimated that between 31 and 241 public school students would be generated from development in Olde Towne over the next three to five years, which means the County could see anything from an $886,174 savings to a $1,957,362 loss.

Tomasello thinks those numbers are wrong.

After conferring with Montgomeroy County Public Schools, he thinks the net increase in public school students over three to five years would be 87. That would generate between $100,000 and $200,000 in savings, he added.

But the County is facing a dismal budget picture already, with County Executive Isiah Leggett (D) last week proposing millions more in mid-year cuts if a referendum on removing ambulance fee revenue from the budget passes on Nov. 2.

If the County's economic impact numbers suggest that the expansion would cost the County millions in lost tax revenue, it's possible the Council will reject the idea out of hand.

Several projects in the Olde Towne area would be affected, and potentially bouyed, by the expanded zone. Already the zone's footprint is larger than the State guidelines. That's because the boundaries were drawn on top of an existing Central Business District for convenience, Tomasello said.

The proposed expansion would nearly double the area inside the zone.

But the existing enterprise zone has been in place for several years and virtually no one has taken advantage of its benefits, leaving little certain for Tomasello to bank on.

That includes whether the County will recommend the expansion.

"I don't know, we'll see," he said.