The Garnet Spy

Greenvilleonline.com has an article by Curtis Loftis, outgoing Director of the Office on Aging, about the “gray wave” about to hit South Carolina. The article notes:

Currently, there are approximately 770,000 South Carolinians over the age of 60. By 2025, that number is projected to swell to more than 1.3 million.

In what may seem an exacerbation of that growth, The Spy suggests the state undertake a vigorous effort to INCREASE that population.

The spate of hurricanes over the last several years along with other – primarily economic – factors are driving retirees out of Florida [or fewer are settling there]. The nation’s other retirement haven, Arizona, is too far for East Coast-based retirees, so the alternative is to go up the coast. Georgia and the Carolinas are good choices because of the weather and lower cost of living, but is South Carolina doing enough to attract these folks?

No.

Although South Carolina exempts Social Security benefits from state income taxes, no exemptions are available for other retirement income. Curiously, this is also the case for retired military. Given the state’s history with and dependence upon the military, this is really odd.

The Tampa Tribune article cited above also notes that there are some negatives to a large retiree population:

Being a retiree haven hurts Florida’s schools, some state economic development leaders say, because some seniors oppose tax increases to fund education. … retirees also create a demand for low-paying service jobs – with the exception of health care workers – and create less demand for high-paying scientists, engineers and managers. That’s because those highly-paid professionals often work for companies that serve national and international markets, not local markets.

There is, however, a … “however”

Still, retirees are a plus for state economies. Retirees cost states money for Medicaid, but generally require less in state and local services. Generally, retirees provide $4 in revenue for every $3 they cost in government services.

With that in mind, neighboring state governments and private developers are aggressively courting Baby Boomers. For example:

•In Georgia. Gov. Sonny Perdue has been pushing the state’s legislature to exempt income from retirement plans from Georgia’s state income tax. Starting next year, the first $35,000 in retirement income will be exempt from the tax. Perdue wants the legislature to exempt all retirement income, said Bert Brantley, the governor’s press secretary. “It’s certainly meant to help attract retirees to the state,” Brantley said. “The governor sees it as a revenue-positive idea.”

•In Tennessee, the state’s economic development department has a new initiative called “Retire Tennessee.” The state has chosen nine largely-rural communities that have amenities and lifestyles for retirees and is helping them market themselves as retirement destinations. Among them is Chattanooga. The state also is sending representatives to retirement-related trade shows nationwide and is advertising in Southern Living magazine.

•In North Carolina one of the hottest retirement destinations is the Asheville region. Richard Lutovsky, president of the Asheville Area Chamber of Commerce, estimated his area has up to 30 planned communities under development, half of which are estimated to have golf courses. Retirees may buy many of the homes, he said.

Herein an outstanding opportunity for South Carolina and it relates not only to revenue, but to community development and revitalization.

TAX EXEMPTION

Exempt ALL retirement income – federal (to include military), state and local from state taxes. This immediately puts the state on the short list of those that do not tax. Yes, it will reduce revenue from those sources, but the economic impact of that population will more than make up for it.

COMMUNITY DEVELOPMENT/REVITALIZATION

As noted in the Tribune article, “some seniors oppose tax increases to fund education.” That certainly seems contradictory for a state whose educational integrity is as bankrupt as South Carolina’s. But it doesn’t have to be.

Ride through any number of small South Carolina towns (like The Spy’s homestead) and you’ll see two things: shuttered downtowns and extraordinary potential. Herein the opportunity. Since there is so much flight from these locales anyway and since the economic infrastructure has already collapsed, why not “recondition” these towns as retirement zones? Refurbish them specifically to accommodate (and attract) retirees. The retail and community services would be developed specifically with that demographic in mind and, since the school system would not be as much of a necessity (at least not in the immediate area), property taxes could be directed to those services most required by that population.

For instance, pick any small town you can think of that has deteriorated over the years. Store fronts are boarded, businesses that are left are barely surviving … you can see it in your mind if not out your window. The Interstate and/or big box stores have stolen the community’s lifeblood like a vampire. There just isn’t much left.

Now, redevelop that community as a retirement location – possibly in collaboration with nearby towns that have suffered the same fate. It’s a retirement “community” on a grander scale – it’s a retirement “town.”

Build/rebuild libraries, medical facilities, movie theaters and, yes, golf courses. Encourage specialty stores and restaurants to locate there. Provide technological enhancements like high-speed internet and digital television access. Recreational facilities designed for this age group can be offered – swimming, tennis, parks, etc. The types of retail services required are easily identified by existing surveys and studies.

The attraction is not only small town living with peers, but an environment much more conducive to seniors than loud, dirty cities.

Such an approach not only reconditions communities that are in disrepair, it creatively establishes a new presence and one that also reconditions the economy. These folks will buy those old houses because that’s what they grew up in and they want room for their grandkids to visit. For others, condominiums would be available for housing that requires less work.

Granted, some retirees will contribute minimally, but many others will bring a fairly large pension income to the area.

There is green in the gray and South Carolina is not only a great place for the retirees, the retirees would be great for South Carolina.