03-22-04 Community & Economic Development

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South Bend Common Council Community and Economic Development Committee Minutes from Meeting of March 22, 2004 The March 22, 2004 meeting of the Council's Community and Economic Development Committee was called to order by its Chairperson,Council Member Roland Kelly,at 3:30 p.m.in the Council Informal Meeting Room. Persons in attendance included Council Members Dieter, Pfeifer, Kelly, Puzzello, Varner, Kuspa,Coleman,Kirsits and White. Among those also present were City Clerk John Voorde,Attorney Kenneth Fedder, Attorney Randy Rompola, Michael Beitzinger (Community and Economic Development), Jim Frick (South Gateway Association), Terry Bland (South Bend Tribune), and Aladean M. DeRose substituting for Kathleen.Cekanski-Farrand, Council Attorney. A full quorum of the Committee existed in that all members were present, namely, Council Members Kelly, Kirsits, Coleman, and Kuspa. A. Presentation on Bills Numbered 04-35 (Waiver) and 04-36 - Tax Abatement for real property located at 3310 William Richardson Court- Trinet Essential Facilities X, Inc.,for the benefit of Cequent Towing Products,Inc. The Committee Chair called for a presentation of Substitute Bills 04-35 and 04-36. Mike Beitzinger from the City Division of Economic Development informed the Committee that the tax abatement is for real property located at 3310 William Richardson Court owned by Trinet Essential Facilities and leased to Cequent Towing Products,Inc. Cequent Towing Products is a subdivision of Cequent Accessories Design Group located in the Goshen,Elkhart area,and the location of the South Bend facility is part of its strategy to consolidate its operations. The amount of improvements is in the range of$860,000(which assumes$54,000 of tax abatement). The new business will provide 83 new jobs in the City and create an annual payroll of$1.9 million dollars. Mr.Beitzinger further added that. this owner has had no prior abatement,however,the building was originally constructed and approved in 1994 for a ten year tax abatement. The real estate is located in the Airport Economic Development Area, a Tax Incremental Allocation Area. Accordingly,the petition for property tax abatement must first be approved by the South Bend Redevelopment Commission which passed a resolution approving the tax abatement on Friday,March 19, 2004. Mr. Beitzinger pointed out that the tax abatement petition technically does not meet the requirements of Indiana Code § 6.1-1-12.1-3 because the owner obtained a building permit and proceeded with a portion of the project representing about $12,800 in construction value. This is contrary to I.C.6.1-1-12.1-11.3(a)(3). For this reason,the petitioner has requested,and the Council is required to approve a waiver of non-compliance in order for the project to be qualified for tax abatement. Council Chair Kelly asked whether Council's rejection of the requested waiver would prevent the grant of benefits and Council Member Puzzello asked why the owner's pulling of a building permit could result in loss of tax abatement qualification. Aladean DeRose advised the Committee that Indiana Code prohibits an owner from commencing development or rehabilitation before an area is designated as an economic revitalization area,that is,before the Common Council approves the petition for designation as an economic revitalization area. Council Member Coleman asked the owner to explain why the building permit was pulled.