Businesses operating in unincorporated parts of Berkeley County might be forced to pay a county tax in the future. The county is considering implementing a business license fee in unincorporated areas to help generate additional county revenue to pay for services needed to protect its expanding population.
If implemented, the county would simply be catching up to its neighboring counties and municipalities. Goose Creek, Hanahan and Moncks Corner already require such a fee — Dorchester County and the Town of Summerville, too.
While talk of a business license fee surfaced in the county about 20 years ago, county leaders voted down the idea. However, Berkeley County is now facing unprecedented growth from the influx of new manufacturing industries and other companies choosing the rural region to setup operations. With business comes workforce members, and county leaders are having to determine alternate funding sources to help pay for certain public safety costs and mandates—without burdening the taxpayer.
The county is already proposing a balanced budget for fiscal year 2019-2020 — budget staff having worked months to offer County Council a nearly $91 million budget that doesn’t include a tax increase or pull money from the county’s fund balance.
“It’s a very difficult job to sit up here and determine how to make the budget work and to provide the services that we’re required or obligated to provide to the public,” said Kevin Cox, the councilman proposing the business license fee.
During a Finance Committee meeting on Tuesday, Cox pointed out that while he’s against “more taxes” and “more fees,” he said he thinks the particular fee is needed to fund vital services, because without it, businesses will simply pass the fee onto the consumer.
“These funds should go for the services that are absolute necessities for the county,” Cox said.
Cox specifically pointed to the fee paying for local roads and first responder agencies including EMS, the Berkeley County Sheriff’s Office and rural fire departments—especially since the county lacks a unified fire department and residents and businesses in the county’s unincorporated parts rely heavily on emergency response from 26 different rural fire departments, many of them lacking vital equipment and personnel.
And the demand on the county’s public safety sector is only growing as the population swells in one of South Carolina’s fastest-growing counties. According to the U.S. Census Bureau, Berkeley County residents this year total close to 222,000, an increase of about 50,000 people from 2010. Another 70,000 people are projected to move to Berkeley County by 2025, according to stats provided by the Charleston Metro Chamber of Commerce’s Center for Business Research.
Cox said out-of-county businesses all-too-often pass through the county without contributing to the funding of local public safety services. He said those same businesses also utilize county roadways without funding their maintenance, and the county’s one-cent sales tax can’t fund every road project.
“Coming up here (to Moncks Corner) today, I saw construction companies with Texas tags and Florida tags,” Cox said. “You know they’re doing business in the county, and they’re not paying a dime.”
To reiterate his point, Cox pointed to Google’s bus service—one he said originally ignited the fee idea in his mind. He said every day a Georgia-based company transports about 10 to 20 bus loads of county residents to-and-from the Google data center in Moncks Corner.
“We get zero dollars in taxes from that company,” Cox said. “There’s no property taxes here because the buses are registered in Georgia. They have no business license here so we get nothing, and yet they’re on our roads; they’re requiring our fire, our police, our EMS; they’re using our services when necessary, but we’re getting nothing out of it.”
Cox explained that neighboring governments and county residents are also reaping part of the benefits of a business license fee that Berkeley County deserves.
“When someone comes from Dorchester County to do work at your house, you’re paying for part of that business license to go back to Dorchester County to provide services to their families,” he said. “The same with Charleston County.”
To an extent, Councilman Jack Shurlknight agreed with Cox’s reasoning.
“I don’t think people should be riding (roads) on our own nickels,” he said. “I think they should be pay their own way with the business license.”
However, Schurlknight also expressed a concern for the county’s small businesses and the negative impact an added fee might have on them; he also wondered how the county could better aid current business owners.
“I also understand about the mom-and-pop business here now that’ve been here for years, and they’re struggling with the big box stores coming in putting them out of business,” Schurlknight said. “I don’t want to put anymore strain on their revenues to keep the doors open.”
Cox responded to Schurlknight’s concern with two possible solutions.
“My initial thought is if you’re already paying property tax in the county already then that could be used as a credit toward your business licenses, and therefore you may not have to pay any,” Cox said.
But due to the time-consuming nature of sorting out tax credits, Cox said the better option might be to cut the fee in half for businesses whose owners also call the county home. He said Dorchester County honors the same rate deduction with their business license fee ordinance.
“By reducing it…it will put the burden on businesses outside the county,” Cox said.
According to the county, there are currently 1,757 commercial buildings located in unincorporated areas.
And that’s the only way Councilman Tommy Newell said he would vote in favor of a business license fee—if the tax is imposed on businesses that aren’t based in Berkeley County but want to conduct services here. Newell said he personally understands the tax burden small businesses face.
The committee did not vote on the issue on Tuesday; they simply started the discussion. Cox said he’s also seeking public input and urged community members with questions and comments to contact him at firstname.lastname@example.org or 843-998-0433.
“We can discuss it because you may change my mind, how I feel about this,” he said.