HomeMy WebLinkAboutConfirming Tax Abatement - FedEx Ground System, Inc. 5115 Dylan Dr. (5 Year Personal Property) RESOLUTION
4498-15
Passed by the Common Council of the City of South Bend, Indiana
September 28, 15
20
Attest: l `AA✓ eL'iL- 1 City Clerk
Attest =a- President of Common Council
Presented by me to the Mayor of the City of South Bend, Indiana
September 29, 20 15
dr- nrili I City Clerk
Approved and signed by me 2p re" bei 2 7 � 20 15
Mayor
RESOLUTION NO. 1 —(r
A RESOLUTION CONFIRMING THE ADOPTION OF A DECLARATORY
RESOLUTION DESIGNATING CERTAIN AREAS WITHIN THE CITY OF
SOUTH BEND, INDIANA, COMMONLY KNOWN AS
5115 Dylan Drive, South Bend, IN 46628
AS AN ECONOMIC REVITALIZATION AREA FOR
PURPOSES OF A FIVE (5) YEAR PERSONAL
PROPERTY TAX ABATEMENT FOR
FedEx Ground System, Inc.
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 5115
Dylan Drive, South Bend, IN 46628 and which is more particularly described as follows:
Business Personal Property
and which has Key Numbers to be assigned be designated 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 as shown by the
attachment pursuant to Indiana Code 6-1.1-12.1-17 and further determines that the petition, the
Memorandum of Agreement between the Petitioner and the City of South Bend, and the Statement
of Benefits comply with Chapter 2, Article 6, of the Municipal Code of the City of South Bend
and Indiana Code 6-1.1-12 et seq.
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.
at's
o • - Common Council
Filed in Clark's Office
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NOT APPROVED
CITY CLERK,SOUTH 2END,6Pt
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227 W.JEFFERSON BOULEVARD 174.04• plij I�I;I���
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SUITE 1400 S. �� o FAX:574/235-9021
SOUTH BEND,IN 46601-1830 11y� ".fi��° 2;
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CITY OF SOUTH BEND PETE BUTTIGIEG,MAYOR
COMMUNITY INVESTMENT
SCOTT FORD,EXECUTIVE DIRECTOR
August 17, 2015
Council Member Gavin Ferlic, Chairperson
•
Community Investment Committee
South Bend Common Council
4th Floor, County City Building
South Bend, IN 46601
RE: Personal Property Tax Abatement Petition for: FedEx Ground Package System,
Inc.
Dear Council Member Ferlic:
Please find the attached information pertaining to a personal property tax abatement
petition for FedEx Ground Package System, Inc.:
> Department of Community Investment's summary report
➢ Copy of the petition
> Statement of Benefits form
> Supporting information.
The report contains the Department's findings relative to the above petition. FedEx
Ground System, Inc. will be purchasing and installing approximately$15,000,000 of new
material handling equipment. To accommodate their planned growth, FedEx will be
relocating the workforce from their Mishawaka based facility to the new, larger facility in
South Bend. The project meets the qualifications for a(5) five year personal property tax
abatement and a representative from FedEx Ground Package System,Inc.will be available
to meet with the Committee on Monday,August 24,2015.
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 235-9339.
Sincerely,
Brock Zeeb
Director of Economic Resources
PLANNING NEIGHBORHOOD ENGAGEMENT BUSINESS DEVELOPMENT ECONOMIC RESOURCES
JITIN RAIN PAMELA C.MEYER CHRIS FIELDING BROCK ZEEB
TAX ABATEMENT REPORT
TO: SOUTH BEND COMMON COUNCIL
FROM: BROCK ZEEB
SUBJECT: PERSONAL PROPERTY TAX ABATEMENT PETITION FOR:
FedEx Ground Package Systems,Inc.
DATE: August 17, 2015
i
a
On Tuesday, August 4, 2015, a petition from FedEx Ground Package System, Inc., was
o
received and subsequently filed with the City Clerk for personal property tax abatement
consideration for property to be located at 5115 Dylan Drive, South Bend, IN 46628.
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 Investment 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 Investment has reviewed the petition (a copy of which is $
attached),investigated the area, and makes the following report. €!
PROJECT SUMMARY
> Purchase new equipment to accommodate their anticipated growth. FedEx will be
relocating the workforce from their Mishawaka based facility to the new, larger
facility in South Bend.
> New project taxes over the five year abatement period—$1,286,801
> Estimated taxes being abated over the five year abatement period—$592,944 . p
> Total taxes to be paid on new and existing equipment over five year abatement !
period—$693,857
EMPLOYMENT IMPACT 1
Per the petition, it is estimated that the total project will: 1
> Create 6 permanent, full-time jobs within the five year abatement period,
representing a new annual payroll of$276,432
> 71 total jobs will be created(6 full time and 65 part time)with a total annual payroll
of$1,079,524
> 19 permanent full-time jobs will be relocated from Mishawaka to South Bend with
a total annual payroll of$875,216.
➢ 127 total jobs will be relocated from Mishawaka to South Bend (19 full time and
108 part time)with a total annual payroll of$2,209,665
PLANNING NEIGHBORHOOD ENGAGEMENT BUSINESS DEVELOPMENT ECONOMIC RESOURCES 1
JITIN KAIN PAMELA C.MEYER CHRIS FIELDING BROCK ZEES
ABATEMENT QUALIFICATION
1. A review of the tax abatements previously granted, finds that the petitioner has not
been granted or associated with any previous abatements.
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 River West Development Area.
4. A review of the Tax Abatement Ordinance No. 9394-03 finds that the petitioner
meets the qualifications for a (5) five-year personal property tax abatement under
section 2-84.2, Tangible Personal Property Tax Abatement.
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5 YEAR
30-Jul-IS
Fed Ex
South Bend German Township
Personal Property Tax Abatement Schedule*
Tax Key Number 025-1010-016902
Current Assessed Value: 0
Estimated Project Cost: 15,000,000
40% 60% 55% 45% 37%
100% 80% 60% 40% 20%
Year1 Year2 Year3 Year4 Years
Current
Assessed Value: AV&Tax Pay 2016 Pay 2017 Pay 2018 Pay 2019 Pay 2020
Current Assessed Value 100% 0 0 0 0 0 0
Base Assessed Value 6,000,000 9,000,000 8,250,000 6,750,000 5,550,000
Less Abatement Deduction (6,000,000) (7,200,000) (4,950,000) (2,700,000) 1
Net Assessed Value ) ( ,410,000)
0 0 1,800,000 3,300,000 4,050,000 4,440,000
Property Taxes:
Assume constant tax rate of 5.4628% 5.4628% 5.4628% 5.4628% 5.4628% 5.4628%
Gross Tax(tax rate x net assessed value) 0 0 98,330 180,271 221,242 242,547
Less Circuit Breaker Credit 0 0 0 0 0 (48,532)
Net Tax 0 0 98,330 180,271 221,242 194,014
Circuit Breaker Cap
Circuit Breaker 3.0000% 0 180,000 270,000 247,500 202,500 166,500
Debt Service 0.6197% 0 0 11,154 20,450 25,098 27,514
Circuit Braker Cap 0 180,000 281,154 267,950 227,598 194,014 '
New Combined Net
Existing Project Existing&New Tax Tax
Year Taxes Taxes Taxes Abated Paid
Pay 2016 0 217,182 217,182 217,182 0
Pay 2017 0 325,772 325,772 227,443 98,330
Pay 2018 0 298,625 298,625 118,354 180,271
Pay2019 0 244,329 244,329 23,088 221,242
Pay 2020 0 200,893 200,893 6,879 194,014
Totals 0 1,286,801 1,286,801 592,944 693,857
*This schedule is for estimation purposes only and assumes constant tax rates. The true tax values "
• will ultimately be determined by the actual assessed valuation and the then current tax rates.
City of South Bend °t
Petition for Incentives
Petition must Include a$250 filing fee payable to the City Clerk's Office before processing can be complete r'1s6
General Information Project Name Project Number
Legal name as registered with Secretary of FedEx Ground Package System,Inc
Stitt
Business structure C Corporation
Company website www.fedex.com
Proposed Project Information
Proposed project address 5115 Dylan Drive Parent company name FedEx Corporation
City,State,Zip I South Bend,IN 46628 Legal owner Westco South Bend,LLC
Site acreage or acreage required
26.1180 IS the real estate owned or Leased
leased
Square feet of fadllty 208,361 If leased by whom Fedex Ground Package System,Inc.
Primary Contact information
Primary company contact name Debbie Dillinger Pile Tax Advisor-FedEx Services
Address of company contact 1000 FedEx Drive Phone (412)859-5089
City,State,Zip Moon Twp.,PA 15108 Email debbie.dillinger@fedex.com
Senior Official Information
Company senior official name Title
Address of company contact(if different from Phone
above)
City,State,Zip Email
Consultant Information/Agent
Hired business consultant/agent name Duff&Phelps/Greg Myers Consultant release(Y/N) Yes
Address 39555 Orchard Hill PI Local economic development partners I Yes
approval(Y/N
City,State,Zip Novi,MI 48375 Email gregory.myers@dduffandphe.ps.com
Project Overview
Brief description of your FedEx Ground(FXG)provides cost-effective,small-package shipping throughout North America.including dependable
company,project,and why the business-to-business delivery and convenient residential service.
property is necessary for
economic growth As part of FedEx Ground's North American network expansion plan,FedEx Ground proposes to have a new 208,000 square
feet distribution center built on Dylan Drive(Ameriplex Park)in South Bend to allow for business rowth. The ro would
result in the relocation and significant expansion of its existing Mis ka,I {(h ich outda too s A(just
under 55,000 SF)to accommodate planned growth In addition ,yktret Ur.IMO t
approximately$15 million in material handling equipment at the roposed G will tate-of- e-art
distribution facility via a long-term lease of 10+years
AUG 17 2015
JOHN VOOFIDE
CITY CLERK,SOUTH BEND,IN
Certified Technology Park appropriate No
Community Revitalization Enhancement No
District
Certify that the Building Permit has not been No Number of residential units created by
issued WINS oroieci N.k
if this is a petition for personal property tax abatement,has
the equipment been installed \o
Investment Details
Public Infrastructure needs(Off- Has any 504 funding been what is the value of a,y equipment being purchased In What is the value of any equipment being
site of project in dollars) received? Indiana for the project? purchased from out of state for the project?
Noon No $800,000 514.200.000
New Project Investments
Calendar Year 2014 2015 2016 2017 2018 2019 2020 2021
Land Acquisition 51,500,000 -----_-
Building Lease Payments ----_---
Building Purchase Costs
New Building Construction S 1q8CC::00 ------
Existing Building Improvements
New Machinery&Equipment S 15.000.000 --_--
Special Tooling/Retooling
New Furniture/Fixtures
New Computer/IT Hardware
New Software -----_--
On-site Rail Infrastructure ------_-
On-site Fiber Infrastructure --------
TOTAL
Full-Time Permanent Indiana-Resident Positions by Calendar Year
Calendar Year Jobs retained Total hourly Cumulative t!of net NEW full time Hourly average wage,w/o Total training Total n to be
wage w/o permanent jobs created at project benefits or bonuses,of expenditure- trained-not
fringe or cumulative net new jobs not cumulative
bonuses cumulative
2014 19 $22.15
2015
2016
2017 4 $22.15
2018 2 S22.15
2019
2020
2021
2022
2023
2024
2025
Provide hourly wage information for new employees in the following positions.
Full time Part time
Laborers
$11.'2
Technical
Managerial $3111 S26.89
Administrative S18.43 $14.94
rr owi •e t ein•ivi.ua responsi•e or coor.inating wit
WorkOne on recruitin-?
Not applicable
Does your company have an EEO hiring policy? Are you an EEO employer?
Yes Yes
Please list the number of full time and part time minority and/or female employees for each of Please describe your commitment to
the last three years: diversity and inclusion by detailing your
outreach and recruitment efforts for the last
Year 2012 2013 2014
three years as well as current policies.
Full Time Part Time Full Time Part Time Full Time Part Time
Black 23 33 26 FedEx's diversity mission statement
Hispanic says"we value the contributions and
p 1 10 perspectives of all employees
Asian __- -- regardless of race.gender,culture.n
religion.age,nationality,disability,or
Indian sexual orientation." For detailed
information about diversity and inclusion
Female 29 38 2 33 at FedEx,please refer to the
_-__-- company's se at http://about.van.
Other
fedex.com/diversity.
Complete,below for Real or Personal Property Tax Abatement only.
Please sign for all requested incentives.
Public Benefit It em:
Information is required on both the construction companies and the
companies which will provide materials purchased for this project.
Please complete the table below with the appropriate information. If Qualify Earned Points Available Points
(Yes or No)
you qualify for the points,please enter the full amount of available
points.
1 Construction Related(Contractors):
A. Employ Local Companies(75%) ''es 20 20
B. Purchase Materials from Local Companies(75%)f M. 0 20
C. Require Employees vs.Independent Contractors No 0 19
O Require Prevailing Wage(Davis Bacon) No 0 22
F Require Health Benefits No 0 22
r Require Pension Benefits No 0 18
Maintain Affirmative Action Plan No 0 20
IISub-total Construction Related: 20 141
2 Wage&Benefit Related(_Owner):
A. Pay Target Wage Levels Yes 33 33
B. Provide Health Benefits Yes 34 34
C. Provide Pension Benefits Yes 29 29
D. Provide Training Yes 28 28
E. Provide Child Care No 0 15
F. - Provide Transportation Assistance No 0 14
6. Provide Employer Assisted Housing program No 0 9
ISub-total Wage&Benefit Related: 124 162
3 Workforce Related:
A. Create New Jobs Yes 42 42
B. Retain Existing Jobs Yes 41 41
C. Maintain Affirmative Action Plan Yes 35 35
No 0
D. Provide Targeted Hiring Preference 34
Sub-total Workforce Related: 118 _ 152
4 Support a Municipal Facility:
Support a SB Municipal Facility(donations to the
A. No 0
zoo,conservatory,museum,etc.) 84
Name of Facility
I !Sub-total Municipal Facility: o $4
Sub-total from Above: 262 1 539
The undersigned owner(s)of real property,located within the City of South Bend,herby petition the Common Council of the City
of South Bend for a real and/or personal property tax abatement consideration and pursuant to I.C.,6-1.1-12.1-1,et seq.,and
South Bend Municipal Code Sec.2-76 et seq.,for this petition state the above.
Submitted By: Date: I ,
What is the current assessed value? Real Property: $28,200 Personal Property: SO
What is the projected assessed value? 'Real Property: 514.600.000 Personal Property: $15.000.000
What is the tax key number for this project? 025-1010016902
What is the six digit NAICS code?
492110
Please attach a Google map and street view of the location.
See Attachment A
Please list the amount of real and personal property taxes Real Property Taxes: Personal Property Taxes:
paid for the last five years when applicable.
Year One
S1,502_58 N/A
Year Two
S1,396.01 NiA
Year Three $1,261.54 N/A
Year Four $1,004.65 N/A
Year Five
5889.06 N.'A
Staff Use Only
Please fill out the Public Benefit Summary Information and add to the total from above.
IYorNI Points Points
Public Benefit Item:
Project Related:
5 A. Redevelop a Site that has Special Needs 49
B. Develop Based on Local University Research 35
C. Achieve a Physical Element of a Plan 36
Sub-total Project Related: 0 120
Super Size Projects(point values are cumulative):
A. 100%to 199% 25
B. 200%to 299% 68
C. 300%to 399% 65
D. 400%and Over 52
Sub-total Super Size Projects: 0 210
7 Pay for Municipal Infrastructure:
A. Pay for Oversizing or Upgrading 14
B. Pay for 26-50%of Extension Cost 26
C. Pay for 51-75%of Extension Cost 39
D. Pay for 76-100%of Extension Cost 52
Sub-total Infrastructure Related: C
Total from Applicant Section: 262 639
Total from Staff Section: 3
Total Public Benefit Points: 262 1,J-1,
Supplement to Petition for Incentives
Frequently Asked Questions
We are frequently asked to explain the following questions,in an effort to clarify we are providing answers
below.
1)How do I pay my petition filing fee?
Your petition filing fee can be paid either in person or via mail to:
City Clerk's Office
Attn:Deputy City Clerk
227 West Jefferson Blvd. •Suite 400 S
South Bend,Indiana 46601
2)Certified Technology Park appropriate?(Page one,under project overview)
In the South Bend area there are only two Certified Technology Parks,Innovation Park and Ignition
Park. If your property is not located in either then the answer would be no.
3) Community Revitalization Enhancement District?(Page one,under project overview)
The map below outlines the CRED area,please check to see if you fall within the boundaries.
_ CREeD District Boundary
Grace __'_South South
Ford e'er p� /l-.
A
-.. Y
W .
Poland c
iDunham i
Fither a 1 Tuft Tuft
Sample
SKerr Onn
5 1 Gant
LL
ref grJ6on Stet 1 1
l 1
1 Broadway
Edward g Haney•Legend M N
Qcne.oau,a romans 2
Indiana r
I I South Band Patna'.
4) Has any 504 funding been received? (Page one,under investment details)
504 Funding is a loan that come from the Small Business Administration. This funding must be applied
for to be received.
5)Total training expenditure-not cumulative(Page two,under full time Indiana resident positions)
The amount of money to be spent per year on training over the course of the project.
6)Total number to be trained-not cumulative(Page two,under full time Indiana resident positions)
The amount of people that you will train per year over the length of the project.
If you have any additional questions that are not addressed by this document,please contact Sarah Heintzelman in the
Department of Community Investment at 574.235.5842 or email at<heint;.c a c uth'en I ,1, -
-
-d in Clerk's Office
f','!I 1 r. ?.01
1
JOHN VOOfDE
CITY CLERK,SOUTH BEND,IN
Attachment A—Google Map and Street View
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Council Member Gavin Ferlic, Chairperson
Community Investment Committee
South Bend Common Council
4th Floor, County City Building
South Bend, IN 46601
Dear Mr. Ferlic:
Community Investment has received a request from the petitioner, FedEx Ground Package System,to
continue consideration for tax abatement until the September 14, 2015 Committee meeting. The
petitioner's representative is not available to meet with the Committee due to a scheduling conflict.
Thank you,
Brock Zeeb
Director of Economic Resources
Community Investment
Filed in CiPoes Office
An 2 4 2015 I
JOHN Vo, -
CITY CLERK,SO ;'- :itND,IN