Jekyll incentives questionable

July 25, 2007
Macon Telegraph

It's standard practice for cities and communities to give financial incentives and tax breaks to developers to entice corporate decision-makers to invest in a community. New business boosts the economy and creates jobs, providing growth that is so necessary for a healthy market economy. But this practice isn't as necessary, it would seem, when the entity seeking new business has all the trappings of a "red hot" property to begin with, as critics of a deal approved by the Jekyll Island Authority in June maintain.

The authority, which oversees development in the portions of the state park where commercial ventures are permitted, agreed to give a rent break and other incentives totaling some $10 million to a major developer, Trammell Crow Co. and partners, that plans to build a $90 million hotel and condominium complex on the Georgia barrier island. And, according to the Atlanta Journal-Constitution, one authority board member, Ed Boshears, describes the agreement as a "sweetheart deal" that is "fiscally irresponsible."

We are inclined to agree. Yes, Jekyll Island is cash-poor, but that's not because developers aren't interested in investing venture capital in projects on the island. Development is restricted by law - 65 percent of the Island must remain undeveloped. Granting $10 million in incentives is taking money that could have gone, the Journal-Constitution noted, to the authority for use in helping restore the historic district or refurbish the island's beaches. And now that Trammell Crow is getting hefty incentives, other developers, who will do millions of dollars of additional development, will be asking for the same handout.

Ben Porter, chairman of the Jekyll authority board, says the incentives were necessary to ensure that the developer move forward quickly with the $90 million project. Maybe, but there's reason to suspect otherwise. The authority must remember that these incentives, whatever they are called, give a break to high rollers while leaving the authority cash-poor to fund necessary improvements to the island. We suspect developers, given a golden opportunity to make big profits, will sign up without the added subsidies.