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HomeMy WebLinkAboutWaiver Tax Abatement - 5102 Dylan Drive - Huron Partners, L.P. RES�LUTION 4116-11 Passed by the Common Council of the City of South Bend, Indiana August 8, 2011 °��'1 Attest: City Clerk .,, � Attest� � esident of Common Council Presented by me to the Mayor of the City of South Bend, indiana August 9, 2011 _.� � � � , ' "� � �--------> City Cierk Approved and signed by me Au g u s t 9 20 11 ���1� u,c G���- .�_ M� � RESOLUTION NO. ����—�_- A RESOLUTION OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA CONFIRMING THE GRANT OF CERTAIN REAL PROPERTY TAX ABATEMENT DEDUCTIONS AND WAIVING NONCOMPLIANCE FOR PROPERTY COMMONLY KNOWN AS 5102 DYLAN DRIVE, SOUTH BEND, INDIANA FOR HURON PARTNERS, L.P. WHEREAS, on August 14, 2006, the Common Council of the City of South Bend (the "Common Council") adopted Resolution No. 3622-06 (the "2006 Resolution"), approving a nine (9) year real property tax abatement for the proposed construction of a new light industrial facility containing approximately 150,000 square feet (the "Building Project"), to be constructed by Huron Partners, L.P., a Holladay Properties entity ("Huron Partners" or "Taxpayer"), within an area located in the City of South Bend that had been designated an economic revitalization area in accordance with ItvD.CoDE § 6-1.1-12.1-1, et seq.; and WI-�REA5, as part of the Building Project, Huron Partners described for the Common Council that (a) the Building Project (also known as the Huron Building) would be the first improvement scheduled for construction within the Portage Prairie project, (b) the Huron Building would be a speculative building containing approximately 150,000 square feet for single or multi-tenant use, (c) the construction of the Building Project would commence in late 2006 and be completed at an estimated cost of approximately $5,000,000, and(d) the success of the Building Project would be helpful to spur further private investment in the Portage Prairie area; and WHEREAS, as contemplated as part of the Building Project, Huron Partners (a) successfully completed constructed of the Huron Building which consists of approximately 150,00 square feet, (b) met its proposed investment in construction and tenanting costs for the Huron Building, and(c)has entered into agreements with separate tenants to occupy 100% of the Huron Building (which tenants have reported their headcounts to Huron Partners during 2009 and 2010 of more than 40 employees); and WHEREAS, the (a) Building Project was first assessed for real property tax purposes as 100% complete for the March 1, 2009 assessment date for taxes payable in 2010 (the "First Tax Year"), and (b) notice of such assessment was provided in the form of a tax bill, as opposed to separate notice of assessment,received in 2010; and 1 WHEREAS, as a result of an employee's departure from Holladay Properties, the Taxpayer (through an inadvertent oversight) did not timely file a Fortn 322 ERA/RE "Application for Deduction from Assessed Valuation of 5tructures in Economic Revitalization Areas" (the "Application Form") on the Huron Building which was to be filed within thirty (30) days after receiving notice of an assessment for the First Tax Year (as contemplated under ItvD. CoDE § 6-1.1-12.1-5); and WHEREAS, this oversight was an unusual occurrence for Holladay Properties, which pays significant annual real property taxes and has made diligent efforts in good faith to make all required Indiana tax filings (including abatement filings) on a timely basis; and WHEREAS, the Taxpayer filed a belated Application Form to claim benefits of the property tax abatement for the First Tax Year(together with its filing of an Application Form to preserve the benefit of property tax abatement for subsequent years) with the St. Joseph County Auditor,which Application Form was denied due to the belated nature of the filing; WHEREAS, the Common Council recognizes that (a)the Taxpayer fulfilled its pledge to build a new light industrial facility in the City of South Bend and thereby to enhance the tax base and support employment in the City; (b) the Taxpayer has requested a waiver of its inadvertent oversight for late filing of the Application Form to claim benefits of the tax abatement for the First Year, which the Common Council has the power and authority to approve under Indiana law, and (c) the Taxpayer would have been entitled to receive the tax abatement benefits for the First Year had no noncompliance event occurred; and W��EREA5, the Indiana General Assembly has expressed the policy of this State by enacting laws that expressly permit tax abatement noncompliance events such as the untimely filing of an Application Form to be waived; and VVHEREAS, the noncompliance event has been corrected, and a public hearing of the Common Council has been held on the subject of this Resolution. NOW, THEREFORE, IT IS HEREBY RESOLVED BY THE COMMON COUNCIL OF THE CITY OF SOUTH BEND,A5 FOLLOWS: SECTION 1. The Taxpayer has presented testimonial and documentary evidence supporting the Taxpayer's (a) fulfillment of its obligations detailed in its original Statement of Benefits and its application for tax abatement related to the construction of a 150,000 square light industrial facility in the City of South Bend at 5102 Dylan Drive, South Bend, Indiana (the "Property"), and (b) inadvertent oversight leading to a belated filing of the Form 322 ERA/RE "Application for Deduction from Assessed Valuation of Structures in Economic Revitalization Areas" to claim the benefits of tax abatement for the March 1, 2009 assessment date on the Property. SECTION 2. The foregoing facts, taken together, lead the Common Council to conclude that the Taxpayer has fulfilled its projected plans to construct new improvements contemplated as part of the 2006 Resolution (the "Abatement") and that its belated filing of an application 2 required to claim the benefits of the Abatement as of March 1, 2009 (for taxes due and payable in ZO10)was inadvertent. SECTION 3. The Common Council hereby waives all matters of noncompliance that may be waived under State and local law regarding the late filing of applicable deduction applications in order for the Taxpayer to claim and receive the benefit of tax Abatement on its investment in new building improvements contemplated as part of the 2006 Resolution as of the March 1, 2009 assessment date, all as is permitted under IND.CoDE § 6-1.1-12.1-11.3 (including specific waiver of any and all nonconformities relating to the requirement, under IND. CODE § 6- 1.1-12.1-5 that economic revitalization area deduction applications be timely filed with the county auditor to claim property tax abatement deductions for the 2009-Pay-2010 tax year). SECTION 4. The Common Council incorporates herein by reference, and hereby ratifies and reaffirms: (a) the 2006 Resolution; (b) the t� abatement application and statements of benefits of the T�payer; and(c)the recitals of this Resolution. The Common Council and the Clerk of the City of 5outh Bend are authorized to take all such further acts and execute and deliver all such further documents for the St. Joseph County Auditor or otherwise as may be reasonably necessary to give effect to this Resolution, all without further application to or formal action by the Common Council. 5ECTION 5. This Resolution shall be in full force and effect from and after its passage and approval by the Mayor. Member of t Common Council �ig�d in Cl�rk'� ��fi�� „ �.,�. PRESENTED ���'� ��� � � ��� ( � NOT APPROVED 3 JO�t� ��R'3!�}�?�r�. CITY Ci.��;�.���k�'�&3�idD,IN ADOPTED g��I TO THE COMMON COUNCIL OF THE CITY OF SOUTH BEND: Your Committee of the Whole, to whom was referred: BILL NO. 11-51 A RESOLUTION OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA CONFIRMING THE GRANT OF CERTAIN REAL PROPERTY TAX ABATEMENT DEDUCTIONS AND WAIVING NONCOMPLIANCE FOR PROPERTY COMMONLY KNOWN AS 5102 DYLAN DRIVE, SOUTH BEND, INDIANA FOR HURON PARTNERS, L.P. 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 Rouse Chairperson, Committee of the Whole BARNES�LTHORNBURG LLP 600 1 st Source Bank Center 100 North Michigan South Bend,IN 46601-1632 U.S.A. (574)233-1171 Fax(574)237-1125 Richard J.Deahl (574)237-1240 www.6tlaw.com richard.deahlQbtlaw.com August 3,2011 VIA HAND DELIVERY Mr. John Voorde City Clerk, City of South Bend 455 County-City Building 227 West Jefferson Boulevard South Bend, IN 46601-1830 RE: Huron Partners. L.P. . Resolution for Waiver of Non-Compliance(Tax Abatement) Dear Mr. Voorde: As you know, we are pleased to represent Holladay Properties and its affiliate, Huron Partners, L.P., with certain real estate matters. On behalf of Huron Partners, we kindly request the Common Council's consideration of the enclosed Resolution to formerly waive Huron Partners' technical non-compliance with a filing requirement to claim the benefits of certain tax abatement. More specifically, in 2006, the Common Council granted a nine (9) year tax abatement on Huron Partners' proposed investment to construct a 150,000 square foot light industrial facility in Portage Prairie (City of South Bend). Huron Partners successfully completed construction of this facility, met its investment target and now leases the entire facility to a few tenants (who employ 40+ employees). The building was first assessed as of March 1, 2009 (for property taxes which became due and payable in 2010). Due to employee turnover, Huron Partners inadvertently missed the 30- day window to claim the benefits of the abatement for the 2009-pay-2010 tax year. The enclosed resolution kindly requests waiver of this non-compliance in order to restore the tax abatement benefits to which Huron Partners would have received had it timely filed the application. We are happy to meet with the Communit� and Economic Development Committee of the Council and the full Council on Monday, August 8` , or at such other date as the Council may prefer. Please feel welcome to contact me, at any time, if I can provide any additional information. We greatly appreciate your professional assistance. Very truly yours, ES &THORNBU �KC;LLP ,: , �t J. �.9.�.. � .-�.. ._ .--� � AUu i�3 2011 `� Richard J. Deahl ;___ . . ....� RJD:sIr �is�'`�'C.�..,w.... _ . ..���q,:a. '-5 Enclosure �"°�`"°° ssnsoz x.rD a2za���� Adanta Chicago Delaware Indiana Los Angeles Michigan Minneapolis Ohio Washington,D.C.