Wednesday, March 30, 2022

Oconee County Commissioners Agree To Tax Refund For Caterpillar After Confirming Error In Tax Filings

***Comment Period Opened For Cole Springs Road Closing***

Oconee County commissioners gave tentative agreement on Tuesday night to a settlement that will result in a nearly $1.1 million refund to Caterpillar for taxes it mistakenly paid on personal property at its plant in Bogart.

Consistent with an agreement between Oconee and Clarke counties signed in 2012 when Caterpillar decided to move to the site, all tax revenue from the firm is split evenly between the two counties.

As a result, Oconee County and Clarke County each will refund $538,405 to Caterpillar.

Oconee County Schools will lose $384,289 as a result, with the county giving up the remaining $154,116. The payment to Caterpillar will be made no later than Dec. 15 of this year.

County Attorney Daniel Haygood told the Board that Caterpillar submitted amended tax returns for 2018, 2019, and 2020, as is allowed by state law, indicating it erroneously paid taxes on certain personal property assets.

According to the agreement presented to the Board on Tuesday, an independent audit for Athens-Clarke County government established the final amount owed to Caterpillar.

In other action on Tuesday, the Board agreed to a Public Comment Period through April 30 before moving forward with the planned permanent closing of Cole Springs Road from Snows Mill Road to Hog Mountain Road.

The Board also received an update on the planned upgrade to Calls Creek Wastewater Treatment Plant and on construction of the new administrative building on the northern edge of Watkinsville.

Tax Agreement

Oconee and Clarke counties granted Caterpillar a tax abatement in 2012 on both real and personal property taxes to entice the firm to locate its manufacturing plant on the approximately 838-acre Orkin tract on the Oconee and Clarke county line.

Board Of Commissioners Meeting Screen Shot 3/29/2022

The site, building and equipment in the Caterpillar plant are owned by the development authorities of the two counties. Only the leases are taxed, and then at a reduced rate for up to 30 years.

County Attorney Daniel Haygood said in a telephone conversation on Wednesday that Caterpillar has been paying the full amount of taxes on some of its personal property, that is, the contents of the building, since it opened its plant here in late 2013.

On April 29, 2021, Caterpillar, with the assistance of Ernst and Young LLP, a global accounting firm, submitted amended tax returns for 2018, 2019, and 2020, as allowed by state law, saying that it overpaid its taxes.

According to the agreement given tentative agreement by the Board on Tuesday, Tax Management Associates, hired by Athens-Clarke County government, conducted an independent audit of the Caterpillar request.

Tax Management Associates is a Charlotte, N.C., firm with offices in Georgia that assists state and local governments with revenue initiatives and audits.

The “independent audit review included reviewing furniture, fixtures and equipment sections of the 2018 through 2021 Business Personal Property tax returns and amended returns, a reconciliation of trial balances and fixed asset detail, and a site inspection of the business,” according to the agreement.


Roughly two-thirds of the Caterpillar property is in Oconee County, and $614,689 of the money owed Caterpillar is from taxes collected in Oconee County, with the remaining $462,122 from taxes collected in Clarke County, according to a spreadsheet attacked to the agreement.

Since the two counties agreed to split revenue, Oconee County will be responsible for refunding only half of the total amount collected, or $538,405. This split is done at the end of the year taxes are collected, and the actual agreement uses the unadjusted figures.

According to the analysis performed by Tax Management Associates, Caterpillar had originally paid $754,120 to Oconee County for the three years 2018 to 2020, and it paid $563,287 to Clarke County.

Haygood told the Board on Tuesday night that Caterpillar had been overpaying its taxes since it opened, but the settlement only covers the three years allowed by state law for refunds for erroneously filed tax returns.

“Caterpillar acknowledges and understands that this Agreement is the final disposition of any and all claims it may have against ACCGov and Oconee County related to their obligation to refund Caterpillar for overpaid taxes in years 2018, 2019 and 2020,” the agreement states.

The Board agreed to put the final vote on the settlement on the consent agenda for its meeting on April 5.

The Board votes on consent agenda items without further discussion unless a commissioner asked to remove the item from the consent agenda.

Cole Springs Road

The Board of Commissioners in September of 2020 authorized the temporary closing of Cole Springs Road between Snows Mill Road and SR 53 (Hog Mountain Road).

Commission Chair John Daniell told the other members of the Board on Tuesday night that he wanted to move forward with consideration of the permanent closing of the road.

Daniell said “Cole Springs Road has got a very unfavorable skew, 30 to 35 degree coming in,” Daniell said. “The best design is for that to be 90 degree.”

The county also is doing design work for a roundabout at Snows Mill Road, Rocky Branch Road, and Hog Mountain Road, Daniell said.

“I believe the closure has been a big success,” Daniell said, “and my recommendation would be that we permanently close the road.

“I know there’s different opinions,” he continued, “so before we make that final decision, the suggestion is that we open up a 30 day comment period.”

Daniell suggested people could register those comments at the Town Hall meeting scheduled for 6 p.m. tomorrow (Thursday) at the Civic Center. The meeting also will be held virtually.

In addition, persons can make a comment about the closure on a form on the county web site.

Calls Creek

Tim Durham, Water Resources Department Director, presented the Board with a bid of $6.5 million from Crowder Construction of Charlotte, N.C., for the upgrade of the Calls Creek Wastewater Treatment Plant from 1.5 million gallons per day to 3 million gallons per day.

The bid included upgrades to the existing influent pump station, new UV disinfection equipment, and a new solids dewatering screw press system.

The money for the upgrade will come from capacity fees and Special Purpose Local Option Sales Tax revenue, Durham said.

County Administrator Justin Kirouac said this work represented only Phase I of the upgrade.

Phase II would involve a discharge line from the plant on the northeast of Watkinsville along U.S. 441 and Rockinwood Drive to the Middle Oconee River.

Phase III would involve reuse irrigation pipes from the plant to county park facilities on Hog Mountain Road.

Kirouac recommended that the Board take no action on the bid until further discussion with Crowder was completed. The Board followed that advice.

Commission Chair Daniell also told the Board that discussion at the Upper Oconee Basin Water Authority is progressing that would lead to a doubling of the output from the water treatment plant from 21 million gallons per day to 42 million gallons per day.

Oconee is a partner with Jackson and Barrow counties on the treatment plant, but Clarke County, which withdraws water from the Bear Creek Reservoir for treatment at its own plant, is a fourth partner in the Authority.

Administrative Building

County Administrator Kirouac said he was moving toward getting a final price for the new Administrative Building at the intersection of North Main Street and U.S. 441 Bypass.

Rendition of New Administrative Building

The county has $14.8 million from its bond sales in hand, he said, and he anticipated the final figures will be “on budget.”

The planned groundbreaking date is June 6 of this year, Kirouac said, and he anticipates submitting a building permit application to the county Planning and Code Enforcement Office next week.

The county also is planning a roundabout on North Main Street at the entrance to the facility, he said. The Georgia Department of Transportation currently is reviewing the proposal, he said.

The building will be 44,000 square feet in size, he said, and the county is looking at building a Facility Shop at the time of construction of the new Administrative Building.

Kirouac said he expected to have a final cost figure and contract ready for the May 3 meeting of the Commission.

The building should be completed in June of 2023, Kirouac said.


The video below is from the March 29 meeting of the Board of Commissioners and is on the county YouTube channel.

The meeting starts at 3:47 in the video.

Discussion of the Caterpillar settlement begins at 5:57 in the video.

Discussion of the Calls Creek plant upgrade is at 8:35 in the video.

The update on the county Administrative Building is at 12:03 in the video.

Upper Oconee Water Basin discussion begins at 16:30 in the video.

The update on the Cole Spring Road closing is at 17:35 in the video.

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