How did South Carolina rank counties for the 2006 job tax credit, and did any county qualify for the reduced fee-in-lieu investment threshold?

Plain-English summary

South Carolina published two different county-ranking lists for the 2006 job tax credit, depending on when the credit was first earned. Both lists apply to new full-time jobs created in tax years beginning in 2006 and to increases in those jobs:

• Ranking List #1 applies when the job tax credit was first earned after June 18, 2002. It uses five designations: distressed, least developed, under developed, moderately developed, and developed.
• Ranking List #2 applies when the credit was first earned after 1995 but before June 19, 2002. It uses four designations, beginning with least developed and ending with developed.

The Department says the rankings give equal weight to county unemployment rates and per-capita income, followed by statutory adjustments under § 12-6-3360.

For the fee in lieu of property taxes, the ordinary minimum investment under both the "Little Fee" and "Simplified Fee" was $5 million. That minimum could fall to $1 million for investment in a county whose average annual unemployment rate was at least twice the state average during each of the preceding 24 months. No county met that test for 2006.

The letter did not publish tax-moratorium rankings because the moratorium under § 12-6-3365 had been repealed effective July 1, 2005.

What this means for you

For a 2006 job-tax-credit calculation, first identify when the credit was initially earned; that determines which of the letter's two county lists applies. A company evaluating the 2006 reduced-investment fee-in-lieu rule could not use the $1 million threshold because the Department found that no county qualified.

Common questions

Q: Why are there two county rankings for the same year?
A: The letter says amendments to the job-tax-credit statute required separate lists based on whether the credit was first earned after June 18, 2002, or after 1995 but before June 19, 2002.

Q: Did any county qualify for the $1 million fee-in-lieu threshold?
A: No. For 2006, no county met the unemployment test for reducing the usual $5 million minimum to $1 million.

Q: Where are the 2006 tax-moratorium rankings?
A: The Department did not provide them because the moratorium statute, § 12-6-3365, had been repealed effective July 1, 2005.

Subject

Job Tax Credit - County Rankings for 2006 Fee in Lieu of Property Taxes – Reduced Investment Counties Tax Moratorium – Qualifying Counties 1

Source

• Landing page: https://dor.sc.gov/advisory-opinion-search
• Original PDF: https://dor.sc.gov/sites/dor/files/policies/IL06-1.pdf

Original ruling text

State of South Carolina

Department of Revenue
301 Gervais Street, P. O. Box 125, Columbia, South Carolina 29214
Website Address: http://www.sctax.org

SC INFORMATION LETTER #06-1

SUBJECT:

Job Tax Credit - County Rankings for 2006
Fee in Lieu of Property Taxes – Reduced Investment Counties
Tax Moratorium – Qualifying Counties 1

DATE:

January 13, 2006

SUPERSEDES:

All previous documents and any oral directives in conflict herewith.

REFERENCE:

S. C. Code Section 12-6-3360 (Supp. 2005)
S. C. Code Section 4-12-30 (Supp. 2003)
S. C. Code Section 12-44-30 (Supp. 2003)

AUTHORITY:

S.C. Code Ann. Section 12-4-320 (2000)
SC Revenue Procedure #05-2

SCOPE:

An Information Letter is a written statement issued to the public to
announce general information useful in complying with the laws
administered by the Department. An Information Letter has no
precedential value.

INTRODUCTION
The job tax credit and the reduction in the minimum required fee in lieu of property tax
investment are dependent, in part, on per capita income and unemployment rate data
received from the South Carolina Employment Security Commission and Budget and
Control Board.
The purpose of this Information Letter is to provide county rankings for purposes of the
job tax credit and counties qualifying for the reduced fee in lieu of property tax
investment.
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No county rankings are provided for the moratorium on corporate income taxes or
insurance premium taxes since the tax moratorium provided in South Carolina Code
Section 12-6-3365 was repealed effective July 1, 2005.

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JOB TAX CREDIT – County Rankings
South Carolina s 46 counties are ranked and designated annually for job tax credit purposes with
equal weight given to unemployment rate and per capita income and then adjusted in accordance
with special rules in South Carolina Code subsections 12-6-3360(B) and 12-6-3360(L), as
applicable. Because of amendments in the job tax credit statute, it is necessary to have two rankings
of South Carolina’s counties for purposes of the job tax credit.
Ranking List #1: For new, full time jobs created in tax years which begin in 2006, where the
job tax credit was first earned after June 18, 2002, and increases in such jobs.
The Department has ranked South Carolina’s counties as “distressed,” “least developed,” “under
developed,” “moderately developed,” and “developed” for computation of the new job tax credit.
Distressed

Least Developed

Allendale
Barnwell
Chester
Chesterfield
Clarendon
Dillon
Hampton
Lee
Marion
Marlboro
McCormick
Williamsburg

Abbeville
Bamberg
Cherokee
Fairfield
Greenwood
Jasper
Lancaster
Laurens
Union

Under
Developed
Calhoun
Colleton
Edgefield
Georgetown
Oconee
Orangeburg
Pickens
Saluda
Sumter

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Moderately
Developed
Anderson
Beaufort
Charleston
Darlington
Florence
Horry
Newberry
Spartanburg

Developed
Aiken
Berkeley
Dorchester
Greenville
Kershaw
Lexington
Richland
York

Ranking List #2: For new, full time jobs created in tax years which begin in 2006, where
the job tax credit was first earned after 1995 and before June 19, 2002, and increases in
such jobs.
The Department has ranked South Carolina’s counties as “least developed,” “under developed,”
“moderately developed,” and “developed” for computation of the new job tax credit.
Least Developed
Abbeville
Allendale
Bamberg
Barnwell
Cherokee
Chester
Chesterfield
Clarendon
Dillon
Edgefield
Fairfield
Greenwood
Hampton
Jasper
Lancaster
Laurens
Lee
Marion
Marlboro
McCormick
Saluda
Union
Williamsburg

Under Developed
Colleton
Georgetown
Horry
Oconee
Orangeburg
Pickens
Sumter

Moderately Developed

Developed

Anderson
Calhoun
Charleston
Darlington
Florence
Newberry
Spartanburg

Aiken
Beaufort
Berkeley
Dorchester
Greenville
Kershaw
Lexington
Richland
York

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FEE IN LIEU OF PROPERTY TAXES - Reduced Investment Counties
The minimum required investment necessary to qualify for the fee in lieu of property tax under
the “Little Fee,” provided in South Carolina Code Section 4-12-30(B)(3), and the “Simplified
Fee,” provided in South Carolina Code Section 12-44-30(14), is $5 million. This investment
amount, however, is reduced to $1 million for a company investing in a county with an average
annual unemployment rate of at least twice the State average during each of the last 24 months,
based on data available on November 1.
For 2006, no counties qualify for the $1 million minimum investment under the “Little Fee” and
the “Simplified Fee.”

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