Fee-in-Lieu-of Property Taxes (FILOT)

Industries investing as little as $2.5 million in Laurens County may negotiate for a Fee-in-Lieu-of Property Taxes or FILOT which will result in savings of about 40% property taxes otherwise due. A Corporation or partnership must make the minimum investment over a five-year period to qualify.

The assessment ratio can be negotiated down from 10.5% to 6%. The agreement can extend up to 30 years. The county and the fee payer may enter into a millage rate agreement, which would set the millage rate for the entire agreement period. Payment of the fee can be structured in any way acceptable to both the county and the fee payer.

The advantages to a company include:

Savings: Payments to local government are reduced significantly through negotiation of a lower assessment ratio and negotiation of an applicable millage rate.
Planning: Payments to local government can be stabilized for the term of the agreement.

The company will be required to obtain a bond attorney to complete a fee agreement. The agreement will require county council’s approval on three readings of an ordinance and will require a public hearing.

Industrial Property Example Calc: Standard Taxes vs. FILOT –Year One

$50 Million Investment Standard Taxes Example FILOT
Fair Market Value or Property Assessment Ratio for Manufacturing $50,000,000
x 10.5%
$50,000,000
x 6.0%
Assessed Value Millage Rate $5,250,000
x .2795
$3,000,000
x .2795
Property Tax (one year)
Mfg Abatement: ($5,250,000 x .0545=$286,125)
$1,467,375
– 286,125
$838,500
– 0
Property Tax After Abatement $1,181,250 0
Property Tax After Fee-in-lieu 0 $ 838,500

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