HomeMy WebLinkAboutReconfirming Tax Abatement - McCormick Co RESOLUTION
4082-11
Passed by the Common Council of the City of South Bend, Indiana
February 14 20 11
Attest: City Clerk
Attest� President of Common Council
Presented by me to the Mayor of the Ciry of South Bend, Indiana
February 1� 2011
City Clerk
Approved and signed by me 20 .
� �
RESOLUTION NO. �-���- -11
A RESOLUTION 4F THE COMMON COUNCIL OF THE
CITY OF SOUTH BEND RECONFIRMING AN
ECONOMIC REVITALIZATION AREA DEDUCTION FOR
MC CORMICK& COMPANY, INCORPORATED
WHEREAS, on July 2, 2010, McCormick and Company, Incorporated filed an
original Form SB-1 Statement of Benefits in connection with its application for personal
property tax abatement on proposed new investments in a building addition and new
manufacturing and logistical distribution equipment at its industrial location at 3425 West
Lathrop Drive in South Bend; and
WHEREAS, the Common Council of the City of South Bend approved that
Statement of Benefits, as revised on January 4, 2011, and designated the area commonly
known as 3425 West Lathrop Drive as an Economic Revitalization Area, all in
accordance and as more particularly described in Resolution No. 4076-11; and
WHEREAS,the Economic Revitalization Area continues in existence and will be
designated as such under that Resolution until July 25, 2012; and
WHEREAS, McCormick & Company is in the process of implementing its
project and has already met and exceeded the estimates for employment and wages and is
making a good faith effort to meet the estimates for the investment and as set forth in the
revised Statement of Benefits; and
WHEREAS, McCormick & Company is interested in making additional
investments in new manufacturing and logistical distribution equipment as more
particularly described in the Amended Statement of Benefits, dated February 3, 2011,
which has been filed with and submitted to the Common Council for its consideration of
five year personal property tax abatement on the new investments described therein.
NOW, THEREFORE, BE IT RESOLVED, by the Common Council of the
City of South Bend, Indiana, as follows:
SECTION I. In compliance with IND. CODE §§ 6-1.1-12.1-4.5(b), the Common
Council hereby finds that:
a. The estimate of the cost of the proposed new manufacturing equipment
and new logistical distribution equipment is reasonable for property of this type.
b. The estimate of the number of individuals who will be employed or whose
employment will be retained can be reasonably expected to result from the proposed
installation of the new manufacturing and logistical distribution equipment.
c. The estimate of the annual salaries of the individuals who will be
employed or whose employment will be retained can be reasonably expected to result
from the proposed installation of new manufacturing and logistical distribution
� equipment.
d. Any other benefits about which information was requested are benefits
that can be reasonably expected to result from the proposed installation of new
manufacturing and logistical distribution equipment.
e. The totality of the benefits is sufficient to justify the granting of the
requested deductions.
SECTION II. The Amended Statement of Benefits, dated February 3, 2011, is hereby
approved and the installation of new manufacturing equipment and new logistical
distribution equipment as described therein are eligible for deductions from assessed
value of the property as per I.C. § 6-1.1-12.1-1 et seq. for a period of five (5)years.
5ECTION III. Except to the extent amended as set forth herein,Resolution 4076-11 shall
continue in full force and effect.
SECTION IV. This Resolution shall be in full force and effect from and after its '
adoption by the Common Council and approval by the Mayor.
Member of the ommon Council
Filed in +�4�r�'� Office
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dO�iFk i�t?t7�°��1�
, . _�. .� �L—���� CITYCLERK,SOi3Y�"����,E�" ,
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TO THE COMMON COUNCIL OF THE CITY OF SOUTH BEND:
Your Committee of the Whole, to whom was referred:
BILL NO.
11-11 A RESOLUTION OF THE COMMON COUNCIL OF THE
CITY OF SOUTH BEND RECONFIRMING AN ECONOMIC
REVITALIZATION AREA DEDUCTION FOR MCCORMICK
& COMPANY, INCORPORATED
RespectFully report that they have examined the matter and that in their opinion,
this bill is being recommended to the full Council with a favorable
recommendation. This bill was heard by the Community and Economic
Development committee.
Timothy A. Rouse
Chairperson, Committee of the Whole
�SpU TH g�,�
� ���Il�il�l�/��� p
iZOO COUNTY-CITY BUILDING ..�, ����\ /��d PHOrre 574/235-9371
v ��\� ,�„ .� �
Z27 W.JEFFERSON BOULEVARD Fa�c 574/235-9021
(aJ, ��\\HACE�/ a
$OUTH BEND,INOUrrn 46601-1830 �r!•`��r �-,��a�
'l�
1865
CITY OF SOUTH BEND STEPHEN J. LUECKE,MAYOR
COMMUNITY HL ECONOMIC DEVELOPMENT
,JEFFREY V. GIBNEY
EXECUTIVE DIRECTOR
February 4, 2011
Council Member Timothy A. Rouse, Chairperson
Community& Economic Development Committee
South Bend Common Council
4th Floor, County City Building
South Bend, IN 46601
RE: Personal Property Tax Abatement Designation Increase for:
McCormick & Company, Incorporated
Dear Council Member Rouse:
Please find attached a letter from Ms. Deidre Cassidy, Director of State and Local Tax for
McCormick&Company, Incorporated. The letter contains a request for an increase in the amount
of the company's five year personal property tax abatement granted by the Common Council through
resolution #4076-11on January 24, 2011. The original amount requested, as amended, was
$1,362,173.They are planning to move an existing brand of products from a co-packer to a company
owned facility. The estimated cost in equipment to set up the new operation is$6,774,426. They are
considering their South Bend facility for this move. As a result,they are asking that the amount of
their personal property abatement by increased by $6,744,426 to a new total of$8,136,599. The
abatement's Economic Revitalization Area designation has an expiration date of July 25, 2012,
which allows time for the move to be carried out.
With this increase the total taxes abated and paid will increase from $10,073 and $103,084
respectively to $125, 205 and $550,707. It should also be noted that the company had planned to
increase employment by five positions under its abatement as currently approved. However, it has
already increased total employment by 10 positions to a new total of 133 jobs and total wages have
gone from $6,288,988 to $6,718,833 for an increase of $429,845 (the projected increase was
$177,247). With the proposed move the company would add an additional 14 positions and increase
wages by another$483,101.
The request requires a reconfirming resolution from the South Bend Common Council. In addition
to Ms. Cassidy's letter,I have attached a copy of a revised Statement of Benefits(Form SB-1)and a
COM�tUNITY DEVELOPMENT ECONOMIC DEVELOPT4ENT FINANCIAL SL PROGRAM
PAMELA C.MEYER DONALD E.INKS MANAGEMENT
574/235-96G0 574/235-9371 ELIZABETH LEONAAD
Fnx: 574/235-9�69 574I235-9371
South Bend Common Council
RE: Tax Abatement for McCormick and Company, Inc.
February 4, 2011
Page 2
copy of the estimated Personal Property Tax Abatement Schedule for your review. Copies of the
original staff report and tax abatement petition are available upon request. A representative of
McCormick&Company will be available to meet with the Committee and answer any questions on
Monday, February 14, 201 l.
Should you or any of the other Council members have any questions concerning the request or need
additional information, please feel free to call me at 235-5835.
Sincerely,
��� ��!-�t�•ys✓
Bob Mathia
Assistant Director,
Economic Development
Attachments
cc: South Bend Common Council Members
Mayor Stephen Luecke
Jeff Gibney
Don Inks
co
McCORMICK&COMPANY INC. �$LOVETON CIRCLE,SPARKS,MD 27152-6000 USA/TEL(410)771-7301 FAX(410)771-7462
February 3,2011
To Whom It May Concern:
McCormick and Company would like to request a confirming resolution from the
Common Council to increase the dollar amount approved for their personal property tax
abatement. McCormick is considering increasi�g the size of their investment in personal
property located at 3425 West Lathrop Drive; South Bend, Indiana 46628 from
$1,362,173 to $8,136,599. The total amount of the increase is$6,774,426.
The increase is due to the fact that we are considering moving an existing brand of
products from a co-packer to a company owned facility. The investment would include
additional packaging equipment allowing us,to sort, fill,wrap and palletize plastic bottles
for liquid mazinades. This in-sourcing of manufacturing is expected to create
approximately 14 additional jabs in the state of Indiana with estimated annual salazies of
$483,101.
Thank in advance for your support on this project. If you have questions,please feel free
to contact me at 410-771-73 81.
Sincerely,
���C���
Deidre Cassidy
Director of State and Local Tax
t+� �+s
,� �� STATEMENT OF BENEFITS FORM SB-1 /PP
�� � PERSONAL PROPERTY AMENDED
� � State Form 51754(R/1-os) PRIVACY NOTICE
''• Prescribed by the Department of Local Govemmeni Finance
The cost and any specific individual's
salary information is confidenUal;the
balance oi the filing is public record
per IC&1.1•72.7-5.1(c)and d).
INSTRUCTIONS:
1. This statemeni must be submitied to the body designafing ihe Economic Revitalization Area prior to the public hearing il the designating body requires
information from the applicant in making its decision about whether to designate an Economic Revitalization Area. Othenvise this statement must be submitted
to the designating body BEFORP a person installs the new manufacturing equipment and/or resear�h and development equipment,and/or IogisGcaf disfribution
equipment and/or information fechnology equipment for which the person wishes lo cfaim a deduction. `Projects"planned orcommitted lo aRerJufy 1, 1987,
and areas designated afterJuly 1.1987,require a STATEMENT OF BENEFlTS. (IC 6-1.1-12.f)
2. Approva/of the desigrtating body(Ciry Councif,Town 8oard,Counfy Council,efc.) must be obtained prior to installation of the new manufacturing equipment
and/or research and development equipment and/or Iogistical distributlon equipment and/or information technology equipment,BEFORE a deduciion may
be approved
3. To o6tain a deduction,a person must file a certified deduction schedule with the person's personal property retum on a certified deduction schedule(Form
?03-ERA)with the fownshlp assessor of the township where ihe property is situated. The 103-ERA must be frled befiveen Ma�ch 1 and May f5 of the
assessment year in which new manufacturing equipment andJor research and development equipment and/or logistical drstribution equipment and/or
in/ormation technology equipment is installed and fully funcUonal,unless a filing extension has treen obtained. A person who o6tains a filing extension must
file the form between Maroh 1 and the exfended due date of that year.
4. PropeRy owners whosa Statement of Benefits was approved afte�June 30, 1991,must su6mrt Form CF-1/PP annually to show compfiance wiih the
Statementof8enefits. (106-1.1-12.1-5.6J
5. The schedules estabffshed under 1C 6-1.1-12.1-4.5(d)and(e)appfy fo equipmenf insfalfed aRer March 1,2001. For equipment installed prior to March 2,
2001,the schedules and statufes in effect at the time shall oontinue to apply. (IC 6-1.1-12.1-4.5(n and(g))
• .• .
Name of taxpayer
McCormick and Company, Inc.
Address of taxpayer(number and streel,crty,state,and Z1P code)
18 Loveton Circle,Sparks,MD 21152
Nama of contact person Telephone number
Deidre Cassidy (410)771•7381
• • . � . . . -.•. . •••
Name of designating body Resolution number(s)
LocaGon of property Counry DLGF taxing district number
3425 West Lathrop Drive,South Bend,IN St.JosePh
Description of manufacturing equipment andlor research and development equipment ESTIMATEO
and/or lo9istical distribution eqwpment andlor information technology equipment. START OATE COMPLETioN DaTE
(use add�tional sheefs if necessary)
We are expanding the investment in personal property Manufacturing Equipment os�o��zo�o o�io�i2o�z
through the purchase of additional packaging equipment R 8 D Equipment
allowing us to sort, fill,wrap and palletize plastic bottles Logist Dist Equipment
for liquid marinades. IT Equipment
. . . � . -.•. . ••.
Current number Salaries Number retained Selaries Number addiGonal Salaries
133 6,718,833.00 133 6,7'i 8,833.00 14 483,101.00
. � . . . . -.•. . •-.
MANUFACTURING R$0 EQUIPMENT LOGIST DIST �7'EQUIPMENT
NOTE:Pursuant to IC 6-1.1-12.1-5.1 (d)(2)the EQUIPMENT EQUIPMENT
COST of the property is confidential. COST �ESSEO COST �SESSED COST ASSESSEA COST �SESSED
Please see attachment UALUE �ALUE VA�UE VALUE
Current values 20,809,992.00 7,439,430.00 685,405.00 228,674.00
Plus estEmated values of proposed project �,950,655.00 �es,saa.00
Less values of any property being replaced o.00
Net estimated valUes upon comple6on of project 28.760,647.00 e��,3as.oa •
• • � . • -. .
Estimated solid waste converted(pounds) Estimated hazardous waste conveAed(pounds)
Other beneflts:
None wifh current project. Wast water facility previously built to treat H20
. ,
I hereby certity that the representations in this statement are true.
Si uthor�ed represeMati TiUe Date slgned(month,day,}rea�
/
Oirector-State&Local Tax a� j�
•• • � :..
We have reviewed our prior actions relating to the designation of this economic revitalization area and find that the applicant meets the general standards
adopted in the resolution previously approved by this body. Said resolution,passed under IC&1.1-12.1-2.5,provides for the following limitations as
authorized under IC 6-1.1-12.1-2.
A.The designated area has been limited to a period of time not to exceed calendar years•(see belowJ. The date this designation expires
is
B.The type of deduction that is allowed in the designated area is limited to:
1. Installation of new manufacturing equipment; ❑Ye s ❑N o
2. Installation of new research and development equipment: ❑Ye s �N o
3. Installation of new logistical distribution equipment. ❑Ye s ❑N o
4. InstallaGon of new information technology equipment; ❑Ye s �N o
C. The amount ot deduction applicable to new manufacturing equipment is limited to $ cost with an essessed value of
S
0. The amount of deduction applicable to new research and development equipment is limited to $��__ cost
with an assessed value oi$__�_ __
E.The amounl of deduction applicable to new Iogistical distribution equipment is limited to$ cost with an assessed value of
$
F. The amount of deduction applicable to new information technology equipment is limited to$ cost with an assessed value of
$
G Other limitations or conditions(specify)
H. The deduction for new manufacturing equipment and/or new research and development equipment andlor new logistica!distribution equipment andlor
new information technology equipment installed and first claimed eligible for deduction on or after July 1,2D00,is allowed for:
❑1 year �6 years "'For ERA's established priorto July 1,2000,�nl,y a
❑2 years ❑7 years 5 or 10 year schedule may be deducted.
❑3 years ❑8 years
❑4 years ❑9 years
❑5 years" ❑10 years"
Also we have reviewed the information contained in the statement of benefits and find that the eslimates and expectations are reasonable and have
determined that the totality of benefits is su�cient to justify the deduction described above.
Approved:(slgnature and tifle of authonzed member) Telephone number Date signed(month,day,year)
Attested by: Oesignated body
'If the designating body limits the time period during which an area is an economic revitalization area,it does not limit the length of time a faxpayer is
entitled to receive a deduction to a number of years designated under IC 6-1.1-12.1-4.5
McCormick and Company, Inc.
Attachement to SB-1 Statement of Benefits-Personal Property
Section 4-Estimated Ttotal Cost and Value of Proposed Project
Current Values have been estimated as follows:
Value on origina!SB-1 21,495,397 7,668,104
Estimated value of proposed project on Original SB-1 1,362,173
Estimated value of proposed project on Amended SB-1 6,774,426
8,136,599
Total Estimated Current Vafue 29,631,996 7,668,104
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