Oconee, Clarke Memo of Understanding with Caterpillar Provides Tax Reduction Details, Penalties for Company Nonperformance

The industrial development authorities of Oconee and Clarke counties signed a 51-page Memo of Understanding with Caterpillar in February that spells out the tax abatement procedures used to entice the manufacturer as well as the penalties Caterpillar will pay if it does not meet its hiring and investment commitments.

The documents details how much money the counties have to borrow through bond sales, stipulates that the property, building and equipment will be owned by the industrial authorities, and tells how the lease that Caterpillar signs for use of the plant and its equipment will be assessed.

It also sets hiring and investment goals for Caterpillar and the penalties that Caterpillar will have to pay if it fails to meet those goals.

The hiring goals in the MOU are lower than those used in the company’s news release, and the penalties for not meeting them are modest.

Caterpillar is obligated to move quickly on the project.

The two counties already have purchased the land for the plant, paying out $9.4 million for the 265 acres.

For details on the MOU and on the land purchase, go to Oconee County Observations.