Hall County officials have quietly decided to spare from taxes a development of hundreds of acres connected to Gov. Nathan Deal’s campaign chairman.
The Hall County Board of Assessors this month voted to make the Gateway Industrial Centre near Gainesville a tax-exempt property, which could save the property’s developers tens of thousands of dollars in taxes each year.
Deal’s campaign chairman, Philip Wilheit, is a partner in the roughly 518-acre industrial park where the state is placing a $13.6 million state poultry laboratory. State officials previously agreed to spend $690,000 to buy 10 acres for the lab, while Hall County will spend about $10 million in taxpayer funds to improve infrastructure around the site in what critics have called a government-backed bailout for a top Deal ally.
As part of the deal, Wilheit and his partners transferred control of the property to the Gainesville/Hall County Development Authority, which Wilheit heads as chairman.
Steve Watson, the county’s chief appraiser, said county tax officials gave the property tax-exempt status because the authority is considered a public entity. The property’s owners spent about $50,000 in taxes in 2012, tax records show, and that figure would have grown as the land’s value increased.
The deal also means that Wilheit and the other developers won’t have to pay capital gains on any parcels they sell, which could increase in value as a result of the taxpayer-funded improvements and the state’s decision to invest in the site.
Wilheit and other investors in the project spent almost $11 million in 2007 for the property, a largely empty site that sits along a busy road that runs through Hall County. County assessors valued the land at about $4.7 million in 2012, though that didn’t include any improvements the county pledged to make.
The property deal came together in late August. After the Hall County Commission voted to use taxpayer money for infrastructure, Wilheit and his partners transferred the property to the development authority. The next day, the State Property Commission, with Deal as chairman, voted to buy its 10 acres from the authority.
Deal did not vote, and his office has said the site was picked because it was the best deal for taxpayers, not because of who owned the land.
Under the deal, the owners would get their money back from the development as the lots in the industrial park are sold. It also calls for the county to be repaid its infrastructure costs through lot proceeds.
Wilheit didn’t return several calls and emails seeking comment, but he has said that he did not take part in discussions to sell the property to the state. He also said that he’s not expecting to recoup the full $11 million he and his partners have tied up in the land, though he’s hoping he’s wrong.
A spokesman for Deal, Brian Robinson, said only that the governor has no role in local tax matters.
Abit Massey, president of the Georgia Poultry Federation, said state officials selected the site in Gainesville, often viewed as the heart of Georgia’s powerful poultry industry, after an extensive search of about 20 sites.
At a poultry conference last week, he said the center is set to break ground in May, and he talked enthusiastically about its potential to spur more growth in the industry. Scientists at the lab, which is set to open in 2015 to replace an aging nearby facility, will monitor poultry disease, test samples and inspect hatcheries.
“This is an extremely important development for the poultry industry and to the agricultural industry throughout the state,” Massey said. “We think it will be a big plus for the Gainesville area and for Georgia.”
Wilheit is one of Deal’s most powerful allies. His family and businesses have contributed more than $50,000 to Deal’s election campaigns since 2010. He’s also a partner, with Deal’s private company, in the airplane that Deal used to fly across the state in 2010 for his election campaign.
Deal appointed Wilheit to the Board of Regents of the University System of Georgia, and he is likely to become its next chairman.
Doug Aiken, a Hall County government activist who has been critical of the deal, said the move amounted to “tax evasion.”
Said Aiken, “The taxpayers up here, and everywhere, will suffer for a group of good ol’ boys.”
Staff writer James Salzer contributed to this article.
The Atlanta-Journal Constitution reported in October that more than $10 million in planned taxpayer-funded improvements had substantially increased the value of land owned by Gov. Nathan Deal’s campaign manager and other investors. That included the state buying 10 acres in the Hall County industrial park, plus funding by the county for roads, sewers and other infrastructure on the land. The AJC now reports that Hall County officials recently awarded tax-exempt status to the property, saving developers hundreds of thousands of dollars a year.