The Palmetto Insider

The blog of the South Carolina Policy Council

Fresh Off Massive Bailout, JP Morgan Looks to SC for More Breaks

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The good folks of Florence County appear poised to get a second opportunity to give their hard-earned tax dollars to one of the world’s largest financial services companies.

Florence County Council is scheduled to hold a public hearing tonight regarding fee-in-lieu-of-tax agreements with JP Morgan Chase, a $2 trillion operation which received a $25 billion taxpayer bailout from the federal government last year.

JP Morgan is planning an undisclosed project that would be located in a multi-county park jointly operated by Florence and Williamsburg counties, according to Florence County documents, the Lake City News & Post reported.

The project would be a taxable investment of at least $2.5 million and create at least 250 new full-time jobs within five years, the documents state.

The fees would be determined by applying a 6-percent assessment ratio to the economic development property’s fair market value and using a fixed millage rate for 20 years.

Fee-in-lieu agreements allow companies to freeze their millage rates. With fee-in-lieu, applicable Florence County property tax assessment ratios can be negotiated down from 10.5 percent to 6 percent.

Of course, as the Policy Council has pointed out before, if South Carolina and its counties lowered taxes, incentives would not be needed. Real economic growth would take place naturally as companies gravitated toward low-tax areas.

And there is something particularly disturbing in the idea that some South Carolinians could, for the second time in a little more than year, see their tax dollars go to benefit a company with $2 trillion in assets and operations in 60 countries.

The U.S. Treasury Department transferred $25 billion to JP Morgan in October 2008 via the Troubled Asset Relief Program (TARP). In June 2009, JP Morgan repaid $10 billion of TARP money it had received.

JP Morgan came under fire this year for paying out large bonuses despite having to take bailout funds just a few months earlier.

In July, New York Attorney General Andrew Cuomo told the Wall Street Journal that, after having received its TARP bailout in late 2008, JP Morgan paid hundreds of millions of dollars in bonuses to more than 1,800 employees.

This included $1 million bonuses to each of more than 1,000 employees, and $3 million bonuses to each of more than 200 employees.

Tonight’s meeting will take place at the community building in Lynches River County Park, between Coward and Effingham.


Written by Cotton Boll Conspiracy

December 10, 2009 at 1:45 pm

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