Why does every other company in the area have to pay the full property tax, and Apple doesn't?
Who says every other company is?
Cities and states offer abatements to attract businesses. They create jobs and new taxation for the city and state.
They are allowing 71% reduction meaning that they are collecting 29% of taxes they would not otherwise collect if the land were to sit there. That's 2,000 acres that they will be paying that 29% on. That's a hell of a lot of money.
Oh, I see. So just the local mom and pops have to pay the full freight.
That sounds fair...
how long does the break for apple last ?
Twenty years.
Apple will leave way before then.
So how is the town going to recoup the government gifts?
50 workers.
About ten years ago one of our customers started growing rapidly and needed a much larger space. They bought some land in one of our suburbs located on a street of old farm houses next to the highway. They got an abatement for the project.
It was miserable delivering there as the old road was in such bad shape it was like driving a truck on the moon. But the city tore out the two lane road in sections and began replacing it; some with four lanes. Before you knew it, other businesses started to build on that street and the side streets coming off of it. Several years later the state put up a new highway ramp for easier access to the new businesses. The Cleveland Clinic erected a new hospital with an ER and the street is still getting new businesses today.
The first business (our customer) built a brand new building with 25 docks. They expanded a few years later and today it's a 54 dock building providing hundreds of jobs.
Cities and states fight for such businesses with tax abatements because it's a huge investment for the city and state even with abatements. Without our customer deciding to relocate there, that street may very well be the same old farm house road it was ten years ago. It's called economic development.
