Boeing would pay 4 percent tax rate

Boeing Co. released some information Friday about the tax breaks it expects to receive from Charleston County in an effort to ease concerns that details of the deal will remain secret at least until after next week's vote.

No dollar figures were disclosed, but the aerospace giant said it would pay the same tax rate as the owner of an owner-occupied home -- 4 percent -- on its real and personal property for 30 years, if the terms are approved Tuesday.

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Typically, industrial taxpayers are assessed at 10.5 percent.

The payment will be based on the total capital investment by Boeing, which picked North Charleston in the fall for a 3,800-worker aircraft assembly plant that is projected to cost $750 million. The amount will be fixed under a so-called fee-in-lieu of tax arrangement, which is a fairly common inducement for large businesses expanding to South Carolina. The dollar figure could change if Boeing adds to or reduces its local investment.

Also, the company said it would be eligible for tax credits known as special-source revenue credits equal to half of its total fee-in-lieu payments. That money would be rebated back to the company during the first 15 years to pay for site improvements at its Charleston International Airport campus.

No other details were released Friday.

"These terms and conditions are commonly seen on significant development projects," said Boeing Charleston spokeswoman Candy Eslinger.

The fee-in-lieu of taxes and special-source revenue programs in South Carolina have the net effect of reducing the burden of property taxes for qualifying businesses, according to the FindLaw Web site.

Officials have described Boeing's expansion as the largest private-sector capital investment in the state's history. Early estimates put the economic impact of the plant, which will produce 787 Dreamliner jets, at $2 billion annually starting in 2017.

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One of the lures for Boeing was the combination of state and local tax incentives and other forms of public assistance that were valued at $450 million when the deal was announced in October.

But most of the details of the package -- a complex mix of varying tax breaks, grants and employee training funds -- don't have to be made public for up to a year after they're finalized, according to state law.

Some County Council members raised questions about the secrecy at a meeting this week after learning the package they are being asked to approve Tuesday might not be released to the public for 12 months. Officials previously said they expected to release the details right after the incentives were approved.

The request for privacy came from Boeing, which asked that the details remain secret until they're finalized. Eslinger said Friday that even after the vote, some of the terms will require more negotiations.

She stressed that Boeing is not seeking to suppress information about the incentives. "We've just been working through the details," Eslinger said.

She also said Boeing requested privacy as a way to keep misinformation from spreading.

A few other details of the $450 million package have trickled out.

For instance, the county has lined up a $5.1 million grant through the state Commerce Department. That money, which comes from a pool of money collected from utilities, is marked for site improvements.

The grant is the largest of its kind for the county, said Steve Dykes, the county's economic development director.

Separately, Berkeley Electric Cooperative Inc. has agreed to give the county a $100,000 grant for improvements near the Boeing site even though the Moncks Corner utility won't provide power for the assembly plant.

County officials also have requested $150,000 to pay for a traffic study around Boeing's North Charleston site, where construction crews are clearing land for the massive new plant.

The assembly line is expected to open next year with roughly 1,000 workers, gradually adding another 2,800 workers during the next seven years.

John McDermott contributed to this report. Reach Katy Stech at 937-5549 or kstech@postandcourier.com.