The URL can be used to link to this page

Home My WebLink AboutSM 10-09-98SOUTH BEND REDEVELOPMENT COMMISSION SPECIAL MEETING October 9, 1998 11:00 a.m. Presiding: Robert W. Hunt, President 1. ROLL CALL 1308 County -City Building 227 West Jefferson Boulevard South Bend, Indiana Members Present: Mr. Robert W. Hunt, President Ms. Eugenia S. Schwartz, Secretary Mr. Philip J. Faccenda Mr. Hardie Blake Member Absent: Redevelopment Staff: Business Assistance: Others: 2. OLD BUSINESS Mr. Michael Donoho, Vice President Mrs. Ann E. Kolata, Director Mrs. Vangelean Urbanski, Recording Secretary Ms. Nancy VanScoyk, Economic Development Specialist Mr. Earl Hoff, Federal -Mogul South Bend, Inc. Mr. Dick Monagle, Federal -Mogul South Bend, Inc. a. Commission approval requested for Resolution No. 1640 approving an application for real property tax deduction for property at 3605 West Cleveland Road in the Airport Economic Development Area. (Federal - Mogul South Bend, Inc.) Federal -Mogul South Bend, Inc.'s petition for tax abatement was presented to the Commission for its consideration at the October 2, 1998, Commission meeting. There was a tie vote and Resolution No. 1640 was tabled at that meeting for consideration at today's meeting. HAWPDATATOMMSM100998.MIN -I- South Bend Redevelopment Commission Special Meeting - October 9, 1998 2. OLD BUSINESS a. continued.... The following staff report was presented to the Commission for its consideration. Federal -Mogul South Bend, Inc. is proposing to expand its existing business to include a 25,000 sf. addition. The expansion will include piston assembly equipment, additional piston coating and piston anodize equipment. The company manufactures automotive pistons from raw aluminum to a finished product for General Motors, Ford and others. The expansion will enable the company to do more in -house manufacturing rather than having it outsourced. The building addition will cost $1,300,000, and the equipment cost will be $3,685,000. The total estimated cost of this project is $4,985,000. It is estimated that the equipment will generate additional sales of $7,986,000 by the year 2000. Per the petition, it is estimated that this project will create 48 new, permanent jobs within the first year, representing a new annual payroll of $1,340,000 and will maintain 400 existing permanent full -time jobs with an annual payroll of $14,000,000. A review of the tax abatements previously granted, finds that Federal -Mogul South Bend, Inc. (formerly known as AE Piston Products, Inc. and AE Goetze, Inc.) has been granted several previous tax abatements and they are as follows: (1) A HAWPDATA \C0MMSN\100998.MIN -2- South Bend Redevelopment Commission Special Meeting - October 9, 1998 2. OLD BUSINESS a. continued.... 10 -year real property tax abatement in May 1986; (2) A five -year personal property tax abatement in May 1986; (3) A five -year personal property tax abatement in April 1991; (4) A 10 -year real property tax abatement in July 1993; (5) A five -year personal property tax abatement in July 1993; (6) A five -year personal property tax abatement in September 1994. Federal -Mogul South Bend, Inc. is in compliance with the reporting requirements for each of the previous abatements. The building commissioner has reviewed the petition and finds the property to be properly zoned for the proposed project. A review of the designated South Bend Redevelopment areas finds that the property is located in the Airport Economic Development Area, which is a Tax Incremental Allocation Area; therefore, the petitions for real and personal property tax abatement must first be approved by the South Bend Redevelopment Commission. The staff received information from Federal-Mogul South Bend, Inc. stating that a foundation permit was obtained prior to submission of the tax abatement petition. H: \WPDATA \C0MMSN\100998.MIN -3- South Bend Redevelopment Commission Special Meeting - October 9, 1998 2. OLD BUSINESS a. continued.... The staff investigated the site and visually confirmed that no concrete work or construction has begun. The staff also confirmed with the Building Department that no building permit has been issued. The staff has reviewed the Tax Abatement Ordinance and finds that Federal -Mogul South Bend, Inc. still meets the qualifications for a six -year real property tax abatement under Industrial Development Citywide because no building permit has been issued. CW Additionally, Federal-Mogul South Bend, Inc. meets the qualifications for a five -year personal property tax abatement under Tangible Personal Property Tax Abatement. Using the estimated project cost of $1,300,000, the taxes generated over the six -year period will be approximately $379,165. Taxes abated over the six -year period will be approximately $222,865. Taxes still paid with the abatement over the six -year period will be approximately $156,300. Ms. Schwartz stated that she voted against this resolution at the last meeting because she did believe there is a difference between a foundation permit and a building permit, and by obtaining the foundation permit, Federal -Mogul had HAWPDATA \C0MMSN\100998.MIN -4- South Bend Redevelopment Commission Special Meeting - October 9, 1998 2. OLD BUSINESS a. continued.... violated the requirements of the statute. Mrs. Kolata explained that she had spoken with Mr. Donoho, who planned to attend today's meeting but was called to another meeting at the last moment. He explained that he was also uncomfortable with the foundation permit having been obtained. Mrs. Kolata suggested that since some of the Commission members were uncomfortable with the foundation permit, the Commission should notify the Common Council to that effect because the Council has traditionally agreed to tax abatements for projects that had a foundation permit and differentiated between a foundation and building permit. The Commission agreed that the Council and staff needed to be informed of this position. Upon a motion by Mr. Blake, seconded by Mr. Faccenda and carried, the Commission adopted Resolution No. 1640 approving an application for real property tax deduction for property at 3605 West Cleveland Road in the Airport Economic Development Area. (Federal -Mogul South Bend, Inc.) Ms. Schwartz voted against Resolution No. 1640. HAWPDATATOMMSM100998.MIN -5- South Bend Redevelopment Commission Special Meeting - October 9, 1998 b. Commission authorization requested for the Redevelopment Commission's President to send a letter to the Common Council regarding the Redevelopment Commission's Policy on Obtaining a Foundation Permit. Mr. Hunt stated that he had drafted a letter to the Council concerning this issue. He asked that other Commissioners review the letter and make any suggested changes. Upon a motion by Ms. Schwartz, seconded by Mr. Faccenda and unanimously carried, the Commission authorized the Redevelopment Commission's President to send a letter to the Common Council regarding the Commission's Policy on obtaining a Foundation Permit. 8. NEXT COMMISSION MEETING: The next Regular Meeting of the Redevelopment Commission is scheduled for October 16, 1998 at 10:00 a.m. JEWMIX1141WWO UWN" There being no further business to come before the Redevelopment Commission, Ms. Schwartz made a motion that the meeting be COMMISSION AUTHORIZED THE REDEVELOPMENT COMMISSION'S PRESIDENT TO SEND A LETTER TO THE COMMON COUNCIL REGARDING THE COMMISSION'S POLICY ON OBTAINING A FOUNDATION PERMIT ADJOURNMENT adjourned. Faccenda seconded the motion and ing was adjo 1 30 a. m. Robert W. Hunt, President Ann E. Kolata, Director HAWPDATMCOMMSM100998.MIN -6-