Economic development team reviews incentives
A minimum salary of $10.50 an hour is one issue that is being given a long look.
A minimum salary of $10.50 an hour is one issue that is being given a long look.
Ben McElrath, president of Marglen Industries where these plastic bottles await processing, wants the local economic development team to think long and hard about all of the ramification of an increase in the minimum pay a company must offer to be eligible for a variety of tax incentives.
What is the appropriate minimum salary for a company to pay its employees before receiving significant incentives from local economic developers for putting a new industry in Rome or Floyd County? That’s an issue members of the Rome-Floyd County Development Authority feel needs to be addressed in the short-term future.
Currently a company must pay at least $10.50 an hour, $3.25 an hour above minimum wage, to qualify for incentives which could typically include job tax credits and property tax abatements.
Greater Rome Chamber President Al Hodge reminded members of the authority that the salary figure is just one part of a larger formula that companies need to meet before becoming eligible for an incentive package. Other factors include the specific level of capital investment a company is going to make in bringing jobs to the community, a company must also pay some health insurance and offer some sort of retirement plan to be eligible for job tax credits and/or a tax abatement package.
Development Authority Chairman Pete McDonald, Al Hodge
County Commission Chairwoman Rhonda Wallace (left) listens as Marglen Industries President Ben McElrath questions whether Rome should raise the minimum salary that an industry would have to pay to qualify for incentives to locate or expand in Rome. The figure is currently $10.50 an hour, and McElrath, chairman of the Greater Rome Existing Industries Association, told the Rome-Floyd County Development Authority that most companies pay well over that now.
president of Georgia Northwestern Technical College, told the panel that it has been 10 years since the salary figure was last adjusted.
“There have been some suggestions to move that to $11 an hour,” McDonald said. “We have talked about allowing maybe up to 20 percent of the jobs below that.”
Floyd County Commission Chairwoman Rhonda Wallace, a member of the authority, said she felt like increasing the minimum would be a good move.
“If we’re going to give our resources to them we should ask more,” Wallace said.
Ben McElrath, who sits Pete McDonald
on the authority by virtue of his position as chairman of the Greater Rome Existing Industries Association, said that as a representative of the manufacturing sector he didn’t think companies should be put into a box as it relates to salary requirements.
“Most of them pay higher than that rate anyway,” McElrath said. “But if somebody was going to come to town and invest $20 million and their average rate was $10.50, I would think we would want that company in Rome.”
McElrath also suggested to the authority that Rome gets pretty excited when a new restaurant or retail store comes to town, but they don’t pay anywhere near the $10.50 an hour figure. Hodge responded to McElrath saying that restaurants don’t receive property tax incentives. Doug Walker / RN-T
He said there has never been a requirement that a manufacturer pay more than the federal minimum wage.
“There is however, after previous discussions, the question of where is the win-win when the community puts incentives on the table,” Hodge said.
Authority member Doc Kibler said he doesn’t know where the sweet spot is for a minimum salary and still keeping Rome and Floyd County competitive with other communities, which are frequently trying to attract the same company.
McElrath said if the authority was concerned about good press, it should take steps to point out all of the industries across the Doc Kibler File, Doug Walker / RN-T community that are paying well above the $10.50 an hour wage. He said the authority should take a hard look at what adjacent communities, such as Bartow and Gordon counties, require to qualify for incentives. Hodge said that communities are “all over the place” in the way they do their incentives. He explained that some even go so far as to stipulate pay levels for each of the various occupations within the company.
“We don’t want to get that bureaucratic,” Hodge said. “We have lost companies to other communities where they wanted to pay $8.50 an hour but yet they wanted major incentives. One of those companies that went to another community is having a very difficult time finding employees and not having turnover while paying $8.50.”
An examination of data from the Bureau of Labor Statistics at some of the mean hourly wages for trades in Rome and Floyd County shows that team assemblers earn about $13.51 an hour; cut, punch and press machine operators make about $16.50; textile winders and twisters get $13.56 an hour; while extrusion and forming machine setters receive about $13.26 an hour.
Hodge said it was not unusual for prospects of site selection consultants to ask where the compensation threshold is for a company to attract the appropriate labor pool.
The Chamber president said it was obvious that more discussions need to take place because if a change to the salary requirement is made it needs to have unanimous support.
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