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Home My WebLink AboutConfirming Tax Abatement - 1827 North Bendix Drive - Mann + Hummel USA, IncorporatedRESOLUTION 3903-08 Passed by the Common Council of the City of South Bend, Indiana September 8, 08 Zo Attest: ~~ ~ City Clerk President of Common Council Presented by me to the Mayor of the City of South Bend, Indiana September 9, 20 08 Approved and signed by me September 10 , 20Q~_ ~~~"G.[.t~t-elf City Clerk RESOLUTION NO. 3 g d 3- o g A RESOLUTION CONFIRMING THE ADOPTION OF A DECLARATORY RESOLUTION DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 1827 NORTH BENDIX DRIVE TO BE AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A FIVE (5) YEAR PERSONAL PROPERTY TAX ABATEMENT FOR MANN + HUMMEL USA, INCORPORATED WHEREAS, the Common Council of the City of South Bend, Indiana, has adopted a Declaratory Resolution designating certain areas within the City as Economic Revitalization Areas for the purpose of tax abatement consideration; and WHEREAS, a Declaratory Resolution designated the area commonly known as 1827 North Bendix Drive, South Bend, Indiana, and which is more particularly described as follows: A parcel of land being part of the Northeast Quarter of the Southeast Quarter of Section 33. Township 38 North Range 2 East, in the City of South Bend, Portage Township, St. Joseph County, Indiana and which has Tax Key Number 018-500-299104 presently, as an Economic Revitalization Area; and WHEREAS, notice of the adoption of a Declaratory Resolution and the public hearing before the Council has been published pursuant to Indiana Code 6-1.1-12.1-2.5; and WHEREAS, the Council held a public hearing for the purposes of hearing all remonstrances and objections from interested persons; and WHEREAS, the Council has determined that the qualifications for an economic revitalization area have been met. NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of South Bend, Indiana, as follows: SECTION I. The Common Council hereby confirms its Declaratory Resolution designating the area described herein as an Economic Revitalization Area for the purposes of tax abatement. Such designation is for Personal property tax abatement only and is limited to two (2) calendar years from the date of adoption of the Declaratory Resolution by the Common Council: SECTION II. The Common Council hereby determines that the property owner is qualified for and is granted Personal property tax deduction for a period of five (5) years, and further determines that the petition complies with Chapter 2, Article 6, of the Municipal Code of the City of South Bend and Indiana Code 6-1.1-12 et sec SECTION III. This Resolution shall be in full force and effect from and after its adoption by the Common Council and approved by the Mayor. ~ .~ D Member of th ommon Council PRESENTED l `8-~8~ NOT APPROVED ADOPTED C(,-~ d~ Filc~r~ (l~ ~E~r~~'~ C,3~fiCe AUG 1 ? 2008 J0;~~1 VC7R^F CITYCLE K, S0. ~3E°!~, IN. 12OO COUNTY-CITY BUILDING 227 W. JEFFERSON BOULEVARD SOUTH BEND,INDIANA 46601-1830 PHONE 574/ 235-9371 FAx 574/235-9021 TDD 574/ 235-5567 CITY OF SOUTH BEND STEPHEN J. LUECKE, MAYOR COMMUNITY ~L ECONOMIC .DEVELOPMENT JEFFREY V. GIBNEY August 1, 2008 EXECUTIVE DIRECTOR Council Member Derek D. Dieter, Chairperson Community & Economic Development Committee South Bend Common Council 4th Floor, County City Building South Bend, IN 46601 RE: Personal Property Tax Abatement Petition for: MANN + HUMMEL USA, INC. Dear Council Member Dieter: Please find attached the Department of Community & Economic Development's report on a personal property tax abatement petition for the above-referenced petitioner. Also attached is a copy of the petition, Statement of Benefits form, and supporting information. The project calls for the acquisition and installation of machinery and equipment to be used for the manufacture of manifolds and air intake systems for automobiles. The machinery and equipment will be located at 1827 North Bendix Drive. The report contains the Department's findings relative to the above petition. The total cost for the equipment is estimated at $2,000,000. The project meets the qualifications fora (5) five-year personal property tax abatement and a representative from Mann + Hummel USA, Incorporated will be available to meet with the Committee on Monday, August 25, 2008. Should you or any of the other Council members have any questions concerning the report, or need additional information, please feel free to call me at 235-5835. Sincerely, G'./4' " / ~ -/rte/ Bob Mathia Assistant Director, Economic Development Attachments cc: South Bend Common Council Members Mayor Stephen Luecke Jeff Gibney Don Inks Filed In Cter'{'~ Office AUG 1 ~~~~ ao~arl voo I;3 alo, iN. CITY CLERK, .. COMMUNITY DEVELOPMENT ECONOMIC DEVELOPMENT FINANCIAL & PROGRAM PAMELA C. MEYER DONALD E. INKS MANAGEMENT 574/235-9660 574/235-9371 ELIZABETH LEONARD FAX: 574/235-9697 574/235-9371 1200 COUNTY-CITY BUILDING 227 W. JEFFERSON BOULEVARD SOUTH BEND, INDIANA 46601-1830 PHONE 574/235-9371 FAx 574/235-9021 TDD 574/ 235-5567 CITY OF SOUTH BEND STEPHEN J. LUECKE, MAYOR COMMUNITY HL ECONOMIC DEVELOPMENT JEFFREY V. GIBNEY EXECUTIVE DIRECTOR TAX ABATEMENT REPORT TO: SOUTH BEND COMMON COUNCIL FROM: BOB MATHIA SUBJECT: PERSONAL PROPERTY TAX ABATEMENT PETITION FOR: MANN + HUMMEL USA, INC. DATE: August 1, 2008 On July 31, 2008, a petition for personal property tax abatement consideration for property located at 1827 North Bendix Drive was filed with the City Clerk by Mann + Hummel USA, Incorporated. Pursuant to Chapter 2, Article 6, Section 2-84.2 of the Municipal Code of the City of South Bend, this petition was referred to the Department of Community and Economic Development for purposes of investigation and preparation of a report determining whether the area qualifies as an Economic Revitalization Area pursuant to I.C.6-1.1-12.1 and whether all zoning requirements have been met. The Department of Community and Economic Development has reviewed the petition (a copy of which is attached), investigated the area, and makes the following report. PROJECT SUMMARY Mann + Hummel USA, Inc. plans to install machinery and equipment costing approximately $2,000,000. The machinery and equipment will be used to manufacture manifolds and air intake systems for General Motors and Toyota. The Petitioner manufactures various products for the automotive industry. The products are made of nylon and plastic and are manufactured using injection molding processes. Total taxes to be abated during the (5) five-year abatement period are estimated at $18,329. Net new tax revenue resulting from the project is estimated to total $122,922 over the five year abatement term while total taxes to be ~ during the (5) five-year abatement period are estimated at $585,294. COMMUNITY DEVELOPMENT ECONOMIC DEVELOPMENT FINANCIAL HC PROGRAM PAMELA C. MEYER DONALD E. INKS MANAGEMENT 574/235-9GG0 574/235-9371 ELIZABETH LEONARD FAX: 574/235-9697 5741235-9371 South Bend Common Council RE: Tax Abatement for Mann + Hummel USA, Inc. August 1, 2008 Page 2 EMPLOYMENT IMPACT Per the petition, it is estimated that the total project will create four (4) new, permanent, full-time jobs within the first year representing a new annual payroll of $120,000. The project will retain one hundred fifty-four (154) existing permanent, full-time jobs (of which 46 are minority employees) with an annual payroll of $4,500,000. ABATEMENT QUALIFICATION 1. A review of the tax abatements previously granted, finds that the petitioner has been granted or associated with the following five (5) previous tax abatements: Term/Type 5 year personal property 5 year personal property 5 year personal property 5 year personal property 5 year personal property 2. The Building Commissioner has reviewed the petition and finds the property to be properly zoned for the proposed project. 3. A review of the South Bend Redevelopment designation areas finds that the property is located in the Airport Economic Development Area, which is a Tax Incremental Allocation Area; therefore, the petition for personal property tax deduction must first be approved by the South Bend Redevelopment Commission. 4. A review of the Tax Abatement Ordinance No. 9394-03 finds that the petitioner meets the qualifications fora (5) five-year personal property tax abatement under section 2-84.2, Tangible Personal Property Tax Abatement. ~l1~!~$ ~~a i~~~3',5'~ (3iflGe A.UG 1 2008 Mai ^^ Resolution No. Date 1882-91 7/22/1991 2098-93 9/13/1993 3005-01 5/14/2001 3231-03 8/25/2003 3523-OS 9/26/2005 5 YEAR Mann + Hummel USA, Inc. South Bend Portage Township Personal Property Tax Abatement Schedule* Tax Key Number Current Assessed Value: Estimated Project Cost: ~~18-507-299104 2,606;600 2,000,000 5-Aug-08 40% 56% 42% 32% 24% Current 100% 80% 60% 40% 20% Assessed Value: AV & Tax Year 1 Year 2 Year 3 Year 4 Year 5 Current Assessed Value 100% 2,606,600 2,606,600 2,606,600 2,606,600 2,606,600 2,606,600 Base Assessed Value 800,000 1,120,000 840,000 640,000 480,000 Less Abatement Deduction (800,000) (896,000) (504,000) (256,000) (96,000) Net Assessed Value 2,606,600 2,606,600 2,830,600 2,942,600 2,990,600 2,990,600 Prooerty Taxes: Assume constant tax rate of 4.3015% 4.3015% 4.3015% 4.3015% 4.3015% 4.3015% Gross Tax (tax rate x net assessed value) Less Circuit Breaker Credit Net Tax Circuit Breaker Cap Circuit Breaker Debt Service Circuit Braker Cap ,'t ; ra ; .~, -: i -~ ~ G7 ~~ ~~U IV i7 ~ d ~ 112,123 112,123 121,758 126,576 128,641 128,641 (19,649) 0 (4,057) (8,261) (10,063) (10,063) 92,474 112,123 117,701 118,315 118,578 118,578 3.0000% 78,198 102,198 102,198 102,198 102,198 102,198 0.5477% 14,276 14,276 15,503 16,117 16,380 16,380 92,474 116, 474 117, 701 118, 315 118 , 578 118, 578 New Combined Net Existing Project Existing & New Tax Tax Year Taxes Taxes Taxes Abated Paid 1 92,474 28,382 120,856 8,733 112,123 2 92,474 30,134 122,609 4,907 117,701 3 92,474 28,601 121,075 2,760 118,315 4 92,474 27,505 119,980 1,402 118,578. 5 92,474 26,629 119,103 526 118,578 Totals 462,372 141,251 603,623 18,329 585,294 schedule is for estim ion purposes only and assumes constant tax rates. The true tax values rtttnla'[a?T2TR1 d by the actual assessed valuation and the then current tax rates. CITY OF SOUTH BEND PETITION FOR • TANGIBLE PERSONAL PROPERTY TAX ABATEMENT CONSIDERATION -The undersigned owner(s) of new manufacturing equipment, personal property, located within the City of South Bend, hereby petitions the Common Council of the City of South Bend for personal property (new manufacturing equipment) tax abatement consideration and pursuant to I.C., 6-1.1-12.1, et se and South Bend Municipal Code Section 2-84.2, et seq., for this petition states the following: 1. Describe the proposed project, including information about the new manufacturing equipment personal property (Aequipmeat@) to be installed, the amount of land to be used, if any, the proposed use of the equipment, and a general statement as to the value of the project to your business. The project involves the installation of machinery and equipment costing approximately $2.0 million. The machinery and equipment will be used to manufacture manifolds and air intake systems for General Motors and Toyota. 2. The project will create 4 new, permanent jobs within the first year, representing a new annual payroll of $120,000 and will maintain 154 existing permanent full-time and 0 existing part-time jobs representing an • annual payroll of $ 4,500,000. The projected annual salaries for each new position created are estimated to be as follows: Hourly: Four (4) (x,14.33 per hour = $120,000 3. Estimate the total cost of the Equipment: $2,000,000 4. (a) The Equipment is owned or to be owned by the following individuals or corporations (if the business organization is publicly= held, indicate also the name of the corporate parent, if any, and the name under which the corporation has filed with the Securities and Exchange Commission): NAME ADDRESS MANN+HUMIVIEL USA, INC 1827 N. BENDIX DR. SOUTH BEND, IN 46628 • INTEREST (Revised 8/2/02) 1 • (b)The following other persons lease, intend to lease, or have an option to buy this Equipment (include corporate information as required in (4)(a) above, if applicable): NAME ADDRESS INTEREST N/A 5. Give a brief description of the overall nature of the business and of the operations occurring at the location for which tax abatement is requested: MANN+HUMMEL USA, INC manufacturers various products for the automotive industry. The products are made of nylon and plastic and are manufactured using injection molding processes. 6. The commonly known address of the property where the Equipment is to be located is: 1827 N. Bendix Dr., South Bend, IN 46628 7. The Key Number of said property is: 18-2184693802 • 8. Attach the legal description of the property where the equipment is to be located, marked AExhibit A,@ and is hereby incorporated herein. 9. Attach a map and/or plat describing the property where the equipment is to be located, marked AExhibit B,Q and is hereby incorporated herein. 10. Attach photographs of the property, taken within 30 days of filing of this petition, marked AExhibit C,@ and hereby incorporated herein. 11. The current assessed valuation of the tangible personal property to be replaced by the new manufacturing equipment is $ N/A (This information maybe obtained from the St. Joseph County Assessors office 235-9523) 12. The current use of the real property where the Equipment is to be installed is Manufacturing and the current zoning is E (use) and A (height and area). (This information maybe obtained from the Building Department 235-9553) • (Revised 8/2/02) 2 • 13. List the real and personal property taxes paid at the location during the previous five years, whether paid by the current owner or a previous owner: YEAR REAL PROPERTY TAXES PERSONAL PROPERTY TAXES 2007 64,499.97 106,974.58 2006 66,937.56 188,279.60 2005 57,543.50 123,288.84 2004 56,776 123,288.84 2003 57.758 292,080 (This information may be obtained from the St. Joseph County Treasurers office 235-9531) 14. Describe the commitment made within the past five years by your firm to hiring minority individuals, including number of minorities employed during each of the past five years, specifying whether full time or part-time and whether permanent or temporary employees. The Petitioner shall also list the current number of total employees (full and part-time) and the current number of minority individuals (full and part-time). MANN+HUMMEL USA, INC is an equal opportunity employer. Minority Mull-time) employment has been: 2007 - 46, 2006 - 46, 2005 - 38, 2004 - 38, 2003 - 42 15. Describe on-site child care or day care facilities, services or benefits currently offered or proposed to be offered by the Petitioner for children of employees. None currently offered or proposed. 16. What is your best estimate of the market value of the new Equipment after installation? $ 2.0 Million 17. What is your best estimate of the amount of taxes to be abated during each of the five years after installation? $47,900 year 1, $41,214 year 2, $23,183 year 3 $11,775 year 4, $4,415 year 5 18. What is the commitment your firm will make to minority employment during the five years of tax abatement? As evidenced in #14 above, MANN+HUMMEL USA, INC has made firm commitment to minority employment in the past, and is dedicated to its commitment to minority employment in the future. 19. The Equipment has not been installed as of the date of filing of this petition. . (The signature at the end of this Petition is verification of this statement) (Revised 8/2/02) 3 • 20. The standard Industrial Classification Manual major group within which the proposed project would be classified, by number and description: SIC code 3089, plastic manufacturing 21. The Internal Revenue Service Code of Principal Business Activity by which the proposed project would be classified, by number and description: 3070 22. The real property where the Equipment will be installed is located in the following Allocation Area, if any, declared and confirmed by the South Bend Redevelopment Commission: Airport economic development area 23. Other anticipated public financing for the project including, if any, industrial revenue-bonding to be sought or already authorized, assistance through the United States Department of Housing and Urban Development funds from the City of South Bend, Small Business Association Sections 503 and 504 financing through the Business Development Corporation of South Bend, Mishawaka, and St. Joseph County, Indiana; or other public financial assistance, including • but not limited to public works improvements. Not applicable 24. Describe how and why the manufacturing equipment to be replaced or the facility in which Equipment will be added is currently technologically, economically or energy obsolete and how and why that obsolescence may lead to a decline in employment and tax revenues: Not applicable 25. The new manufacturing equipment will be used in the direct production, manufacture, fabrication, assembly, extraction, mining, processing, refining, or finishing of other tangible personal property and that the equipment was never before used by its owner for any purpose in Indiana. The signature at the end of this Petition is verification of this statement. 26. The following person(s) should be contacted as Petitioner=s agent regarding • additional information and public hearing notifications: (Revised 8/2/02) 4 • Name: Christina Carroll-Gose Address: 6400 S. Sprinkle Rd. City, State, Zip Code: Portage, MI 49002 Telephone: (269) 329-3947 WHEREFORE, Petitioner requests that the Common Council of the City of South Bend, Indiana, adopt a declaratory resolution designating the area described herein to be an economic revitalization area for purposes of tangible personal property tax abatement consideration, and after publication of notice and public hearing, determine qualifications for an economic revitalization area have been met, and confirm such resolution. Petitioner herein hereby verifies that the required $250.00 filing fee to cover processing and administrative costs pursuant to Section 2-84.7 of the Municipal Code of the City of South Bend has been paid in full. Name of Property Owner(s): By: . (Sigj~ned a e) 2J2~~/~~ ~ ~~d/~ (Typed or printed name and capacity of signor if signed by an agent or representative of the owner) J U L ~ ~~ ~~08 ,~n .6~ CITY r . ..:_.. ':, • (Revised 8/2/02) 5 MANN+HUMMEL MANN+HUMMEL AUTOMOTIVE, Inc. 1827 North Bendix Drive South Bend, Indiana 46628 Telephone: (574) 232-6911 Fes; (574) 289-9435 Exhibit A A parcel of land being part of the Northeast Quarter of the Southeast Quarter of Section 33. Township 38 North, Range 2 East, in the City of South Bend, Portage Township, St. Joseph County, Indiana. • A 1114.~n~~ ~~J G TY ~' ~ _. _.. iwl:._.._~ ~ • i`, ~ lr~; jr .. i t : G ~y '~' _~u . ~ ~ =~ , .. .. ~, ; ~ : ~ ' ~~ ~., . ,:; . ono ~~ J 1 ' ~ ~ ! 1 .. i'l: y,, 11~~ \ a . r- LJ I JC ~'~._. .. _ _ . ' 1. ~ REI7CWAC ~:::• { '•''t ~ A/RPOR t ~ O~ ? i R ~ coy ~, . Oo; -. ~ LEGEND OfF1CE PARK .HOTEL OFiTCE PARK/COIF COURSE ~ RE9DENTIAL ® CORPORATE HANGERS ~•~ , RECREATION GENERAL COMUERCIAL ® EK INDUSTRIAL PARK ^ HIGHWAY COOUERdAL ®EX COYI+IERdAL INOUSIRIAL PARK ®EX RECREATION ®AIRPORT DEVELOPUENT ®EX. 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