Newberry City Commission Backs Tax Exemption, Fee Credits for Project Hydro

NEWBERRY – Newberry City Commissioners addressed a full agenda Monday night, Nov. 10, 2025, turning their focus to economic development initiatives including a proposed ad valorem tax exemption and an impact fee mitigation agreement tied to Project Hydro. The actions advance a multilayered incentive package designed to support investment, job creation and long-term growth within the city.

Project Hydro Ad Valorem Tax Exemption

Commissioners voted unanimously to approve Ordinance No. 2025-73, authorizing a structured ad valorem tax exemption for Project Hydro based on improvements and tangible personal property associated with its planned facility. The exemption applies only to City of Newberry taxes and does not affect taxes levied by the county, school district or other authorities.

The approved schedule spans nine years and provides the following phased reductions:

• Years 1–2: 100% exemption
• Years 3–4: 80% exemption
• Years 5–6: 60% exemption
• Years 7–8: 40% exemption
• Year 9+: 0% exemption

The exemption period is set to begin Jan. 1, 2027, and conclude Dec. 31, 2034, contingent on Project Hydro’s continued compliance with employment and wage commitments. If those requirements are not met, the City may revoke the exemption and recover taxes that were abated.

The ordinance notes that the incentives are intended to support significant private-sector investment and job creation within Newberry, consistent with established economic development goals. Assistant City Manager and CFO Dallas Lee confirmed that all applicable statutory requirements and existing city ordinance provisions have been met.

Although specific business details remain exempt from public disclosure at this stage, Project Hydro has represented that the new operation will employ at least 50 full-time equivalent workers, provide average annual wages at or above 115 percent of the regional average and make major capital investments in its new facility.

Impact Fee Mitigation Agreement

The Commission’s approval of the tax exemption transitioned into the second part of the Project Hydro discussion: impact fee mitigation. This related measure expands on the City’s economic development policy framework and is designed to complement the goals established in the ordinance.

In 2023, the City Commission adopted a resolution creating the Economic Development Impact Fee Mitigation Program. The program allows the City to reduce or waive portions of impact fees for new or expanding businesses that generate substantial economic benefits through job creation, investment and above-average wages.

Harvest Singularity Newberry Farm I, LLC, developer of Project Hydro, submitted an application seeking impact fee mitigation under this program. The proposal involves construction of a state-of-the-art hydroponic greenhouse facility within City limits. According to staff review, the project meets eligibility requirements outlined in Resolution 2023-48.

Under the proposed Impact Fee Mitigation Agreement, Project Hydro may receive up to $73,000 in impact fee credits based on verified hiring and wage achievements:

• 10 new jobs paying at least 115% of the average annual wage
• 7 new jobs paying at least 150% of the average annual wage
• 3 new jobs paying at least 200% of the average annual wage

Any remaining impact fees beyond the credit amount will be paid directly by the developer.

To remain eligible for the credits, the developer must complete the planned capital investment and create the 20 new jobs within three years of receiving the first Certificate of Occupancy. Annual documentation—including payroll summaries and RT-6 wage reports—must be submitted to verify compliance.

The agreement remains in effect for four years following issuance of the Certificate of Occupancy. Should the developer fall short of performance obligations, the City may recapture fees on a pro rata basis. Enforcement measures, including lien foreclosure, remain available to the City if needed.

Commissioner Tony Mazon moved to approve the agreement, with Commissioner Farnsworth seconding the motion. The measure passed as recommended by staff.

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