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19-27 Catalyst Three Confirming Real Property Tax Abatement
Filed in R03�!�' :�-201i9 ificp } AP �t.`-.,,.. ►-.x/.ij ,S tI,tIA1-r TES�3�P�D,IN, ,, , iv CITY G�EBIC SC�� CITY OF SOUTH BEND COMvU\ ITY INVESTMENT Council Member Gavin Ferlic, Chairperson April 3,2019 Community Investment Committee South Bend Common Council 4th Floor, County City Building South Bend, IN 46601 RE: Real Property Tax Abatement Petition for: Catalyst Three,LLC Dear Council Member Ferlic: Please find attached the Department of Community Investment's report on a real property tax abatement petition for the above-referenced petitioner. Also attached is a copy of the petition, Statement of Benefits form,and supporting information. Catalyst Three,LLC is proposing to invest more than$16,000,000 in the construction of a new office building located in the Ignition Park, South Bend. The report contains the Department's findings relative to the above petition. The project meets the 1 qualifications for a(8)eight-year real property tax abatement and a representative from Catalyst Three will be available to meet with the Committee on Monday,April 8, 2019. 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 235-5823. Sincerely, Daniel Buckenmeyer Director Economic Resources &Business Development DANIEL J.BUCKENMEYER ALKEYNA ALDRIDGE PAMELA MEYER 'FIM CORCORAN BUSINESS DEVELOPMENT ENGAGEMENT&ECONOMIC EMPOWERMENT NEIGHBORHOOD DEVELOPMENT PLANNING&COMMUNITY RESOURCES EXCELLENCE ACCOUNTABILITY INNOVATION INCLUSION EMPOWERMENT 14005 County-City Building 227 W.Jefferson Blvd. South Bend,Indiana 46601 p 574.235.9371 www.southbendin.gov TAX ABATEMENT REPORT TO: South Bend Common Council FROM: Angelina Billo SUBJECT: Real Property Tax Abatement Petition For: Catalyst Three,LLC DATE: April 1, 2019 On March 29, 2019, a petition for real property tax abatement consideration for property located in the Ignition Park,South Bend was filed with the City Clerk by Catalyst Three,LLC. 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,investigated the area,and makes the following report. PROJECT SUMMARY • Catalyst Three, LLC is proposing to invest more than $16,000,000 in the construction of approximately 83,000 sq. ft.new office space in the Ignition Park, South Bend. • The new office building is intended to serve as an instrumental factor in retaining a highly valued employer within the City of South Bend. • Total project cost is approximately$16,000,000. • Petitioner is qualified for an eight-year real property tax abatement. • The estimated amount of taxes phased-in for the eight-year abatement is$2,373,722. Estimated paid taxes paid for the eight-year term are$418,898. Current annual taxes are under$1,500. EMPLOYMENT IMPACT As the developer,Catalyst Three,LLC will not have direct employees.However,this site/building is being built-to-suite a very important South Bend corporation that DCI has been working with for the last five years to retain and grow in South Bend.The benefits of this tax incentive will directly impact the retention of, at least, 500 full-time jobs in the City of South Bend. ABATEMENT QUALIFICATION 1. A review of the tax abatements previously granted finds that the Petitioner,Catalyst Three,LLC has not been granted or associated with any previous tax abatement. 2. The Area Plan Commission has reviewed the petition and finds the property to be properly zoned for the proposed project. 3. The Building Commission has reviewed the petition and finds no building permit was issued. 4. The property is located in the River West Development area. 5. 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E m C') 0 CO 5-00 O O Z 7 av hf.1,1....1.1,h h C K a -°)700) N M I:mQ of m d~ ONNNCNNN1: V m o N 1D 1n 10 Nr) Cr) 7) r]r0)C')ca)�C')fC')C')tr0) N y �° a N 2 g mho 0p 1i a0§)o moo g'X om mm o g d t m 10 r) v o to cm)_ co. 1 co r)c-)_..el cmr)_ r> d) m m UQ7 7 N� W~ o �ym 0 O g >0 --N(`)P to co hm o E 10 NydU > aO J N...-4 e o a a O O W CO o Ri O co OO O $ Z .a �O 81- 01 a0 pm 0 Y E z co 1�UW II v %1O'v• a o 2 •3> tNi N ,o o U ro To x0 0 >>T. 0) N 1%.,x10„ 0 0`) 0.1. 2 Y ,o V co °� Ea mrn I.9xmF x cinm w r N _ Of cc M� `as az a8 m 'z 0 505 N wV>- O . .co U m J a o 3 U i Filed in Clerk's Office BILL NO. 19-27 APR H�0 3 2019 KAREEKVIAOWLLER RESOLUTION NO. CITY CLERK,SOUTH REND,sN A RESOLUTION CONFIRMING THE ADOPTION OF A DECLARATORY RESOLUTION DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS Ignition Park, South Bend, IN 46601 AS AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF AN EIGHT (8) YEAR REAL PROPERTY TAX ABATEMENT FOR Catalyst Three, LLC 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 the Ignition Park, South Bend, Indiana, and which is more particularly described as follows: Lot 3 Ignitions Park Minor Sub #1 15/16NP#1101010-28-2014 and which has Key Number 018-8021-084916 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 Real property tax abatement only and is limited to three (3) 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 Real property tax deduction for up to a period of eight (8) years as shown by the schedule outlined below as well as 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. Year 1 - 100% Year 2 - 100% Year 3 - 100% Year 4 - 100% Year 5 - 95% Year 6 - 90% Year 7—80% Year 8-70% 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. Tim Scott, Council President South Bend Common Council City of South Bend /=�N Petition for Incentives :« � Petition must include a$250 filing fee payable to the City Clerk's Office or online via the City's website at r_ http://southbendin.gov/government/content/tax-abatement before processing con be complete General Information Project Name Press Ganey Project Number Legal name as registered with Secretary of CATALYST THREE, LLC State Business structure Indiana limited liability company Company website www.greatlakescapital.com Proposed Project Information Proposed project address I Ignition Drive(Ignition Park) Parent company name City,State,Zip South Bend, Indiana 46601 Legal owner Catalyst Three, LLC Site acreage or acreage required 6.91 Acres Is the real estate owned or Owned leased Square feet of facility Proposed—83,000 If leased by whom Primary Contact Information Primary company contact name Jeff Smoke title Director of Development Address of company contact 112 West Jefferson Blvd.,Ste 200 Phone 574 855-5700 city,State,Zip South Bend, Indiana 46601 Email jsmoke©greatlakescapital.com Senior Official Information Company senior official name Jeff Smoke Title Same Address of company contact(if different from Phone above) City,State,Zip Email Consultant Information/Agent Hired business consultant/agent name Richard Deahl,Barnes&Thornburg LLP Consultant release(Y/N) Y Address 100 N Michigan Street, Suite 700 Local economic development partners approval jY/N City,State,Zip South Bend, Indiana 46601 Email 1 rdeahl@btlaw.com Project Overview Brief description of your company,project,and why the Construction of proposed 83,000 square foot new office, as an property is necessaryfor enhancement for the Ignition Park development in South Bend. This economic growth g p project is intended to serve as an instrumental factor in retaining a highly valued employer within the City. Filed in Clerk's Office MAR 2 9 2019 KAREEMAH FOWLER Certified Technology Park appropriate CITY CLERK,SOUTH BEND, N Is the project in a Tax Incremental Financing Y 11-IF 1 area? If so,which? Certify that the Building Permit has not been No permit issue Number of residential units created by NIA issued IY/Nl oroiect If this Is a petition for personal property tax abatement,has i NIA the equipment been installed Investment Details Public Infrastructure needs(Off- Has any 504 funding been What is the value of any 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? No N/A N/A New Project Investments Calendar Year 2019 2020 2021 2022 2023 2024 2025 2026 Land Acquisition Building Lease Payments Building Purchase Costs New Building Construction S 6000,000 00 S10.000.000.00 Existing Building Improvements New Machinery&Equipment Special Tooling/Retooling New Furniture/Fixtures New Computer/1T Hardware New Software Onsite Rail Infrastructure Onsite Fiber Infrastructure TOTAL $NaN $NaN $NaN $NaN $NaN $NaN $NaN $NaN Full-Time Permanent Indiana-Resident Positions by Calendar Year Calendar Year lobs retained Total hourly Cumulative it of net NEW full time Hourly average wage,w/o Total training Total p 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 2019 PIs See Exhibit 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Provide hourly wage information for new employees in the following positions. Full time Part time Laborers Technical Managerial Administrative Who will be the individual responsible for coordinating with WorkOne on recruiting? Does your company have an EEO hiring policy? Are you an EEO employer? 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 Year outreach and recruitment efforts for the last three years as well as current policies. Full Time Part Time Full Time Part Time Full Time Part Time Black Hispanic Asian Indian Female Other Complete below for Real or Personal Property Tax Abatement only. Please sign for all requested incentives. Public Benefit Item: Information is required on both the construction companies and the companies which will provide materials purchased for this project. Qualify Please complete the table below with the appropriate information. If Earned Points Available Points you qualify for the points,please enter the full amount of available (yes or No) points. 1 Construction Related(Contractors): A. Employ Local Companies(75%) Y 20 20 B. Purchase Materials from Local Companies(75%) Y 20 20 C. Require Employees vs.Independent Contractors Y 19 19 D Require Prevailing Wage(Davis Bacon) N 22 E. Require Health Benefits Y 22 22 F Require Pension Benefits Y 18 18 G. Maintain Affirmative Action Plan Y 20 20 Sub-total Construction Related: FI ./ 141 2 Wage&Benefit Related(Owner): J A. Pay Target Wage Levels Y 33 33 B. Provide Health Benefits Y 34 34 C. Provide Pension Benefits Y 29 29 D. Provide Training Y 28 28 E. Provide Child Care N 15 F. Provide Transportation Assistance N 14 G. Provide Employer Assisted Housing program N 9 Sub-total Wage&Benefit Related: r.::w . 162 3 Workforce Related: A. Create New Jobs Y 42 42 B. Retain Existing Jobs Y 41 41 C. Maintain Affirmative Action Plan 35 35 D. Provide Targeted Hiring Preference Y 34 34 Sub-total Workforce Related: 152 152 4 Support a Municipal Facility: Support a S8 Municipal Facility(donations to the A. Y 84 zoo,conservatory,museum,etc.,) 84 Name of Facility t 1 L l-- S't-q-f-Lr t_' 1' nc---k?Vv l'o/yy/ 2�1°' Sub-total Municipal Facility: 5. 84 Sub-total from Above: i/ 5 539 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 end t nigipa�Code Sec.2-76 et seq.,for this petition state the above. Submitted By: _7 Date: 3149//"7 For Staff Use Only Below This Line What Is the current assessed value? Real Property: / a (e,r) Personal Property: What is the projected assessed value? Real Pro PertY d0(" (fix�ersonai Property: i What Is the tax key number for this project? What is the six digit NAILS code? Please attach a Google map and street view of the location. 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 Year Two Year Three Year Four Year Five Please fill out the following Public Benefit Summary Information and add to total from above. Y or N1 Points Points Public Benefit Item: Prolect 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: 120 6 Super Size Projects(point values are cumulative): A. 100%to 199% 2 r 25 B. 200%to 299% jj iCc7 68 C. 300%to 399% � 65 D. 400%and Over 5 52 Sub-total Super Size Projects: '-t6-7 210 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 S2 Sub-total Infrastructure Related: 131 Total from Applicant Section: /.79 539 Total from Staff Section: /D 461 Total Public Benefit Points: ,� 1000 Filed in Clerrkk'ss-Office I STATEMENT OF BENEFITS LIAR 2 9 2019 l 2020 PAY 2021 ` '"'"'f"fj REAL ESTATE IMPROVEMENTS __ State Form 51767(R6/10-14) I KAREEMAH FOWLER FORM SB-1/Real Property Prescribed by the Department of Local Government Finance C�j1Y CL ERK,c ' �U r BEND, IN PRIVACY NOTICE This statement is being completed for real property that qualifies under the following Indiana Code(check ohe boxy- Any information concerning the cost Redevelopment or rehabilitation of real estate improvements(IC 6-1.1-12.1-4) or the property and specific salaries p p paid to individual employees by the ❑Residentially distressed area(IC 6-1.1-12.1-4.1) property owner is confidential per IC 6-1.1-12.1-5.1. INSTRUCTIONS: 1. This statement must be submitted to the body designating the Economic Revitalization Area prior to the public hearing if the designating body requires information from the applicant in making its decision about whether to designate an Economic Revitalization Area. Otherwise,this statement must be submitted to the designating body BEFORE the redevelopment or rehabilitation of real property for which the person wishes to claim a deduction. 2. The statement of benefits form must be submitted to the designating body and the area designated an economic revitalization area before the initiation of the redevelopment or rehabilitation for which the person desires to claim a deduction. 3. To obtain a deduction,a Form 322/RE must be filed with the County Auditor before May 10 in the year in which the addition to assessed valuation is made or not later than thirty(30)days after the assessment notice is mailed to the property owner if it was mailed after April 10. A property owner who failed to file a deduction application within the prescribed deadline may file an application between March 1 and May 10 of a subsequent year. 4. A property owner who files for the deduction must provide the County Auditor and designating body with a Form CF-1/Real Property. The Form CF-1/Real Property should be attached to the Form 322/RE when the deduction is first claimed and then updated annually for each year the deduction is applicable. IC 6-1.1-12.1-5.1(b) • 5. For a Form SB-1/Real Property that is approved after June 30, 2013, the designating body is required to establish an abatement schedule for each deduction allowed. For a Form SB-1/Real Property that is approved prior to July 1, 2013, the abatement schedule approved by the designating body remains in effect. IC 6-1.1-12.1-17 SECTION 1 TAXPAYER INFORMATION Name of taxpayer CATALYST THREE LLC Address of taxpayer(number and street,city,state,and ZIP code) 112 WEST JEFFERSON BLVD., SUiTE 200 Name of contact person Telephone number E-mail address Jeff Smoke,Director (574 ) 251-4400 JEF jsmoke(d!greatlakescapital.cam SECTION 2 LOCATION AND DESCRIPTION OF PROPOSED PROJECT Name of designating body Resolution number Common Council of City of South Bend Location of property County DLGF taxing district number Ignition Park Description of real property Improvements,redevelopment,or rehabilitation(use additional sheets it necessary) Estimated start date(month,day,year) November 2019 Proposed investment of over$16,000,000 for new construction of office building in Ignition Park Estimate dcompletion date(month,day,year) Feb.20121 SECTION 3 ESTIMATE OF EMPLOYEES AND SALARIES AS RESULT OF PROPOSED PROJECT Current number Salaries Number retained Salaries Number additional Salaries SECTION 4 ESTIMATED TOTAL COST AND VALUE OF PROPOSED PROJECT REAL ESTATE IMPROVEMENTS COST ASSESSED VALUE Current values I Plus estimated values of proposed project 16,000.000 Less values of any property being replaced Net estimated values upon completion of project 516.000.000 SECTION 5 WASTE CONVERTED AND OTHER BENEFITS PROMISED BY THE TAXPAYER Estimated solid waste converted(pounds) Estimated hazardous waste converted(pounds) Other benefits SECTION 6 TAXPAYER CERTIFICATION I hereby certify that the represent(o In i statement are true. Signature of authorized representativ I Date sig ed( 'th,day.year) 3/ 1 Ii9 Printed name of authorized representa'ye C Title ejtC Page 1 of 2 FOR USE OF THE DESIGNATING BODY We find that the applicant meets the general standards in the resolution adopted or to be adopted by this body. Said resolution,passed or to be passed under IC 6-1.1-12.1,provides for the following limitations: A. The designated area has been limited to a period of time not to exceed calendar years*(see below). The date this designation expires Is B. The type of deduction that is allowed in the designated area is limited to: 1.Redevelopment or rehabilitation of real estate improvements 0 Yes ❑No 2.Residentially distressed areas ❑Yes 0 No C. The amount of the deduction applicable is limited to$ D. Other limitations or conditions(specify) E. Number of years allowed: 0 Year 1 ❑Year 2 ❑Year 3 0 Year 4 ❑ Year 5 (`see below) ❑Year6 ❑Year 7 ❑Year 8 ❑Year [] Year10 F. For a statement of benefits approved after June 30,2013,did this designating body adopt an abatement schedule per IC 6-1.1-12.1-17? ❑Yes 0 N If yes,attach a copy of the abatement schedule to this form. If no,the designating body is required to establish an abatement schedule before the deduction can be determined. • We have also reviewed the information contained in the statement of benefits and find that the estimates and expectations are reasonable and have determined that the totality of benefits is sufficient to Justify the deduction described above. Approved(signature and title of authorized member of designating body) Telephone number Date signed(month,day.year) Printed name of authorized member of designating body Name of designating body Attested by(signature and title of attester) Printed name of attester If the designating body limits the time period during which an area is an economic revitalization area,that limitation does not limit the length of time a 1 taxpayer is entitled to receive a deduction to a number of years that is less than the number of years designated under IC 6-1.1-12.1-17. A. For residentially distressed areas where the Form SB-1/Real Property was approved prior to July 1,2013,the deductions established in IC 6-1.1-12.1-4.1 remain in effect.The deduction period may not exceed five(5)years. For a Form SB-1/Real Property that Is approved after June 30, 2013,the designating body is required to establish an abatement schedule for each deduction allowed. The deduction period may not exceed ten (10)years. (See IC 6-1.1-12.1-17 below.) B. For the redevelopment or rehabilitation of real property where the Form SB-1/Real Property was approved prior to July 1,2013,the abatement schedule approved by the designating body remains In effect.For a Form SB-1/Real Property that is approved after June 30,2013,the designating body is required to establish an abatement schedule for each deduction allowed.(See IC 6-1.1-12.1-17 below.) IC 6-1.1-12.1-17 Abatement schedules Sec.17.(a)A designating body may provIde to a business that is established in or relocated to a revitalization area and that receives a deduction under section 4 or 4.5 of this chapter an abatement schedule based on the following factors: (1) The total amount of the taxpayer's investment in real and personal property. (2) The number of new full-time equivalent Jobs created. (3) The average wage of the new employees compared to the state minimum wage. (4) The infrastructure requirements for the taxpayer's investment, (b) This subsection applies to a statement of benefits approved after June 30,2013. A designating body shall establish an abatement schedule for each deduction allowed under this chapter. An abatement schedule must specify the percentage amount of the deduction for each year of the deduction, An abatement schedule may not exceed ten(10)years. (c) An abatement schedule approved for a particular taxpayer before July 1,2013,remains In effect until the abatement schedule expires under the terms of the resolution approving the taxpayer's statement of benefits. Page 2 of 2 Jat f � rl J • 3 i - — W is 1 i H _ Q H ace ___2-AO 0 aa1Qi.tit9i Z !( Cs _ el• o —, N O N a4 el d o -n c 0) c I� C 4:t u a vo v Z 00 cm r410 ,0 a R - Co d A co .4., a Ca ; ce 0 Ela.Z_ d 5 It o .,8 4.i `.ter `Q N F+ cal c.I V N �--1 7) Z e C . Nt o W U rco .+CL > d _. __� c rn 4) `c o� C: PO > — c? v� o x c -1 a. 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