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HomeMy WebLinkAbout12-09-91 Human Resources & Economic Development Mnttunf to Road coo the fdomnwn Qlountil of hr Q1tt of Onuill irud: MEETING OF THE HUMAN RESOURCES AND ECONOMIC DEVELOPMENT COMMITTEE The meeting convened at 4:45 p.m. , on December 9, 1991, with Chairperson Lee Slavinskas and all Council Members present. Bill No. : Petition for Personal Property Tax Abatement - Automatic Technologies John Fonash, of the City of South Bend' s Department of Economic Development, presented the petition of Automatic Technologies for 5-year personal property tax abatement. Mr. Fonash noted that no new jobs would be created but that 210 jobs would be retained. Mr. Fonash noted that Automatic Technologies was located in a TIF area, but not in a tax abatement area and that the Redevelopment Commission had approved the petition at its November 8, 1991, meeting. Mr. Fonash noted that the estimated tax to be paid without the personal property tax abatement over the 5-year period in question was $19,264.00. It was proposed that $15,237. 00 of that amount be abated for a total tax paid of $4,027. 00. Mr. Fonash noted that Automated Technologies was working together with Aquarius Tool and Die, which was also petitioning for tax abatement. Mr. Fonash noted that Aquarius makes molds which are used by Automated Technologies to make plastic injection parts. Mr. Fonash introduced Dick Parker and Larry Deskavich of both companies. Mr. Parker indicated that the new equipment in question was needed to upgrade the quality of the product of the plastic products being made. He indicated that Automatic Technologies was interested in getting into the medical field where the quality and precision of plastic parts, such as clear plastic syringes and other medical equipment, was crucial to the success of a supplier. Public Portion: No comments from the public. Council Portion: No comments from the Council Members. Motion to send the petition to the Common Council with a favorable recommendation made by Councilperson Niezgodski, seconded by Council Member Duda, and approved unanimously. II. Bill No. Petition for Personal Property Tax Abatement -- Aquarius Tool and Die Mr. John Fonash, of the City' s Department of Economic Development, presented the petition for personal property tax abatement filed by Aquarius Tool. Mr. Fonash noted that no new jobs would be created, but that 26 jobs would be maintained. He noted that Aquarius Tool was located in the TIF area but not in a tax abatement area. Mr. Fonash indicated that without tax abatement $11,063. 00 in personal property taxes would be paid over the 5-year period, that $8,750 in taxes was proposed to be abated, and that $2,313 in personal property taxes was proposed to be paid over the 5-year period. Public Portion: No comments. Council Portion:. Mr. Luecke asked how long the companies had been in business. Mr. Parker noted that Automatic Technologies has been in business approximately 26 years and that Aquarius Tool and Die has been in business approximately 12 years. Mr. Slavinskas questioned whether there was a sufficiently trained work force to work in this industry. Mr. Parker said that there was, but no over supply of such trained workers. Motion to send to Council with favorable recommendation made. by Council Person Duda, seconded by Council Person Niezgodski, and approved unanimously. III . Bill No. Petition for Personal Property Tax Abatement Lock Joint Tube Personal property tax abatement of Lock Joint Tube. Mr. John Fonash, of the. City's Department of Economic Development, presented. the petition of Lock Joint Tube for personal property tax abatement. Mr. Fonash indicated that the new equipment to be purchased would be used in the production of tubing and would improve the productivity, quality, and efficiency of production at Lock Joint Tube. Mr. Fonash noted that the predecessor owner, which had filed Chapter 11 Bankruptcy, had left the company in a situation that required the new owner to receive the petitioned tax abatement in order to be competitive. Mr. Fonash noted that the value of the equipment to be installed totalled $1,250,000, that ten ( 10) new permanent full-time jobs would be created, and that 154 jobs would be maintained. Mr. Fonash noted that the business was located in neither a TIF nor a tax abatement area. Mr. Fonash further noted that over the 5-year period in question $115,546 in taxes would be assessed; that it was proposed that $91,392 of the amount be abated for total tax payments of $24,155. Mr. Fonash introduced representatives of Lock Joint Tube, Mr. Greg Frehoef and Mr. Gerald Lehrman. Mr. Fonash noted that Mr. Lehrman was the owner of Steel Warehouse, which had recently purchased the assets of Lock Joint Tube. Public Portion: No comments. Council Portion: Mr. Luecke asked whether Lock Joint Tube was a 24-hour work day. Mr. Lehrman indicated that although the company sometimes was on a 24-hour work day, it was generally operating only two shifts. Mr. Luecke expressed his concern noted that if and when the company returns to a 24-hour work day it be sensitive to the noise concerns of the nearby North Shore Apartments residents. Mr. Luecke noted the cooperative efforts of Lock Joint Tube in the past with respect to this issue. Mr. Lehrman informed the Council that Lock Joint. Tube had filed bankruptcy and that Steel Warehouse had bought its assets. He noted, in response to a question from Mr. Slavinskas, that Lock. Joint Tube made 1/2" to 3/4" tubing to be used in the manufacture of office furniture and other similar items. He indicated that the tubing in question was not structural tubing. Mr. Slavinskas noted that Lock Joint Tube was a true manufacturing concern and expressed his appreciation for the willingness of the new owners to continue to invest in the company. Motion by Council Member Slavinskas to send the bill to the Council with favorable recommendation was seconded by Councilperson Duda and approved unanimously. Iv. Resolution. No. Consolidation of the. St. Joseph County and South. Bend Building Departments Patricia DeClercq, Director of the Department of Code Enforcement for the City of South Bend, presented the bill for the Committee's consideration. Mrs. DeClercq indicated that. Mayor Kernan would appear before the. Council at its meeting that evening to present the bill. Mrs. DeClercq also introduced Kathy Dempsey, of the Department of Code Enforcement, Mary Mueller, of the City' s Legal Department, and Don Fozo, County Building Commissioner and proposed County/City Building Commissioner under the joint County/City Building Department. Ms. Mueller informed the committee that the resolution presented to them for their consideration approved the concept of the joint Building Department and authorized the Mayor to sign the Interlocal Agreement creating the joint Building Department. . Public Portion: No comment. Council Portion Mr. Slavinskas spoke in favor of the idea of a Consolidated. Building Department. He noted that every projection he had seen suggested a cost savings. However, in light of the concerns raised by the County Council when it first considered the proposal, Mr. Slavinskas questioned why the joint Building Department would not be operated as a County Department, as opposed to a City Department, and why Mishawaka was not included in the joint operation. In response to Mr. Slavinskas' s questions, Ms. Mueller indicated that. Mishawaka was taking a "look and see" approach to the idea. She expressed her opinion that if the joint County/City Building Department worked out well, it was likely that Mishawaka would consider joining forces at a later date. Mrs. DeClercq noted that the building codes throughout the State are uniform. Consequently, South. Bend, St. Joseph County, and Mishawaka implement the same building codes.. However, she did note that there are some differences in how Mishawaka operates on an administrative level. For example, Mishawaka does not avail itself of the Area Plan Commission as do the City of South Bend. and St. Joseph County. Mrs. DeClercq also noted that with the consolidation of the City and County operation, the City and. County were taking steps to bring their building ordinances into conformity with each other. Councilperson Niezgodski noted that the building ordinances and. codes are and have been uniform. Mrs. DeClercq concurred, but noted that there is some discretion as to Code Enforcement interpretation. and hence, there are some differences. However, Mrs. DeClercq noted. that the joint efforts would result in more uniform enforcement. Mrs. DeClercq also noted that the zoning ordinances of the County and the City of South Bend are different and will remain different. Finally, Mrs. DeClercq noted that the consolidation would result in a cost savings as three positions would be eliminated. She also noted. that these positions would be eliminated through retirement and attrition and not layoff. Mr. Slavinskas expressed his opinion that if Mishawaka would, eventually to vote to join the consolidated department, the budget should be with the County and not the City of South. Bend. Mrs. Duda noted that the question of why the Building Department was going to be a City department and not a County department had not been answered. Ms. Mueller noted, in response, that the City was willing to "take the bull by the horns" to get the consolidation accomplished. She also noted that there was a salary discrepancy between the. City and County and that the City salaries were slightly higher. She indicated that was determined that it would be wiser to raise the few County employees' salaries up to the level of the City salaries than vice versa. Mr. Slavinskas asked who would comprise the Consolidated Building Board. Ms. Mueller responded that the Mayor of the City of South Bend, the President of the County Council, the City Controller, and the County Auditor would comprise the Board. Mr. Niezgodski asked why two elected officials were representing the County while one elected official was representing the City. He asked why the City' s second representative was the Controller and not an elected official such as a Council Member. Ms. Mueller suggested that she was not present when that decision was made but assumed that since the City Controller was the City equivalent of the County Auditor that is why the Controller was designated. Mr. Slavinskas questioned the ability of the Board members to appoint designees. Councilman Ladewski asked about the proposed cost savings, in light of the concerns raised by the County Auditor. Mr. Fozo responded that there was no real dispute. Ms. Mueller noted that the start up costs would eat into the County budget in the first year in a way that would not occur in succeeding years. Kathy Dempsey, of the City's Department of Code Enforcement, presented financial objections to the Committee for its consideration. Councilman Soderberg pointed out that neither department pays for itself. Mr. Niezgodski raised the concerns previously raised by the County officials that this might be a step towards Unigov. Mr. Fozo responded that it was not proposed as such. He further noted that the similar functions undertaken by the separate building departments made it a natural arena to consolidate and attempt to save costs. Ms. Mueller pointed out that the consolidation contract was in effect for one year with an automatic renewal clause and an opt out provision. Mr. Fozo pointed out that Allen County, Indiana, operates a county wide building department with a great deal of success. Ms. Mueller pointed out that the City' s financial contribution for 1992 is a dollar for dollar match of the County's contribution. Motion to send the bill to the Council with a favorable recommendation made by Council Person Slavinskas, seconded by Council Person Duda, and approved unanimously. The meeting of the Human Resources and Economic Development Committee adjourned at approximately 5:45 p.m.