Officials Say Deal For Motorcycle Dealership To Move To East Ridge's Exit 1 Is Windfall For It, City

Thursday, October 11, 2018

Officials said a deal that brings a motorcycle dealership to Exit One under the Border Region Act should be a windfall for both it and the city.

Southern Honda Powersports plans to move from a site on Workman Road near the Georgia line to a new highly visible spot on Ringgold Road near I-75.

Since the location at Scruggs Road is within the designated Border Region District, both the dealership and the city will get sizable payments from the state on sales tax the state would normally retain. All the rebates first go to the city, then a portion is passed on to the dealer.

It was computed that Southern Honda Powersports over the 22-year life of the agreement should have enough sales to pay off its investment in land, construction, interest and other expenses of over $6 million at the site.

East Ridge City Manager Scott Miller said the benefit to the city would be almost $6 million if the firm's projections of $243.2 million in sales for the 22 years holds true. That includes $2.5 million in Border Region sales tax rebates, $2.73 million in local sales taxes and $626,000 in property taxes. He said the city now receives nothing in property taxes since the property is owned by a church - Community Baptist.

The church has over eight acres. It is selling about six acres to the dealership and will continue holding services in the church building on its remaining property.

Mr. Miller said there is some indication that the firm's sales projections may go even higher than the stated amount, which he said would further sweeten the pot for East Ridge.

Doug Hoyt, chief financial officer of Southern Honda Powersports, said the firm is now "in the middle of nowhere" and will welcome the high traffic off the freeway. He said 70 percent of its customers are not local. 

He said the building will be eco-friendly with a solar component and collection of rainwater. The 35,000-square-foot sales area will be near Ringgold Road and there will be a rear shop near Scruggs Road.

In the agreement, Southern Honda Powersports gets 90 percent of the rebated Border Region taxes the first six years, 80 percent for years 7-12; 70 percent for years 13-18, and 60 percent for years 19-22.

Tim Kelly is the owner of Southern Honda Powersports, which opened in 2004.


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