Loading...
HomeMy WebLinkAboutConfirming Tax Abatement - 445 North Sheridan Street - TreadstoneRESOLUTION 3965-09 Passed by the Common Council of the City of South Bend, Indiana April 13, 2009 Attest: City Clerk President of Common Council Presented by me to the Mayor of the City of South Bend, Indiana April 14, 20 09 Approved and signed by me Ap r i 1 15, 20 0 9 City Clerk RESOLUTION NO. 3~ c~S' ©~ A RESOLUTION CONFIRMING THE ADOPTION OF A DECLARATORY RESOLUTION DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 445 North Sheridan Street TO BE AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF AFIVE (5) YEAR PERSONAL PROPERTY TAX ABATEMENT FOR Treadstone, 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 445 North Sheridan Street, South Bend, Indiana, and which is more particularly described as follows: 371.5 Ft on Linden Ave, Beginning 277 Ft West and 60 Ft North Southeast Corner of Southwest Section 4-37-2E and which has Tax Key Number 18-2193-725701 presently, 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, and further determines that the petition complies with Chapter 2, Article 6, of the Municipal Code of the City of South Bend and Indiana Code 6-1.1-12 et se . 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. ~ ~. Member of the Common Council PRESFNTFD ~1-13~~ NOT APPROVED ADOPTED. ~-~3_0~ r~AR - 6 2009 dOHPI ~OORDE CITY CLERK, ~0: BE'VD, IN. - 1200 COUNTY-CITY BUILDING 227 W. JEFFERSON BOULEVARD SOUTH BEND, INDLil3A 46601-1830 PHONE 574/235-9371 FAx 574/235-9021 TDD 574/ 235-5567 CITY OF SOUTH BEND STEPHEN J. LUECKE, MAYOR COMMUNITY HL ECONOMIC DEVELOPMENT JEFFREY V. GIBNEY EXECUTIVE DIRECTOR March 2, 2009 Council Member Timothy Rouse, Chairperson Community & Economic Development Committee South Bend Common Council 4th Floor, County City Building South Bend, IN 46601 RE: Personal Property Tax Abatement Petition for: TREADSTONE, LLC Dear Council Member Rouse: Please find attached the Department of Community & Economic Development's report on a personal property tax abatement petition for the above-referenced petitioner. Also attached is a copy of the petition, Statement of Benefits form, and supporting information. The project calls for the acquisition and installation of a new tire shredding machine to be located at 445 North Sheridan Street. The report contains the Department's findings relative to the above petition. The total cost for the equipment is estimated at $200,000. The project meets the qualifications fora (5) five-year personal property tax abatement and a representative from Treadstone, LLC will be available to meet with the Committee on Monday, March 23, 2009. 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 235-5835. Sincerely, 0 ~%.~~~/ Bob Mathia Assistant Director, Economic Development Attachments cc: South Bend Common Council Members Mayor Stephen Luecke Jeff Gibney Don Inks COMMUNITY DEVELOPMENT ECONOMIC DEVELOPMENT FINANCIAL ~ PROGRAM PAMELA C. MEYER DONALD E. INKS MANAGEMENT 574!235-9660 574/235-9371 ELIZABETH LEONARD FAx: 574/235-9697 574/235-9371 1200 COUNTY-CITY BUILDING 227 W. JEFFERSON BOULEVARD SOUTH BEND, INDIANA 46601-1830 PHONE 574/ 235-9371 FAx 574/235-9021 TDD 574/ 235-5567 CITY OF SOUTH BEND STEPHEN J. LUECKE, MAYOR COMMUNITY ~L ECONOMIC DEVELOPMENT JEFFREY V. GIBNEY EXECUTIVE DIRECTOR TAX ABATEMENT REPORT TO: SOUTH BEND COMMON COUNCIL FROM: BOB MATHIA SUBJECT: PERSONAL PROPERTY TAX ABATEMENT PETITION FOR: TREADSTONE, LLC DATE: March 2, 2009 On February 27, 2009, a petition for personal property tax abatement consideration for property located at 445 North Sheridan Street was filed with the City Clerk by Treadstone, 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 and Economic Development 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 and Economic Development has reviewed the petition ,investigated the area, and makes the following report. PROJECT SUMMARY Treadstone, LLC recycles solid rubber tires into rubber mulch of various sizes and weights depending on use. Ninety percent of their production is a large premium size that is used primarily for children's playgrounds and for landscaping. The equipment to be purchased is a tine shredding machine. The new machine will double the company's production capacity to recycle solid rubber tires into mulch. The company is relatively new. For the past two years it has been using three prototype machines to manufacture its product. These machines are not built to withstand the rigors of the company's current production schedule. The new machine is stronger and will ease the burden on the three prototypes. In fact, the new machine is being built following a design that Treadstone developed and provided to the machine manufacturer. The design is based on Treadstone's experience with their prototypes. The estimated cost of the new machine is $200,000. COMMUNITY DEVELOPMENT ECONOMIC DEVELOPMENT FINANCIAL HL PROGRAM PAMELA C. MEYER DONALD E. INKS MANAGEMENT 574/235-9660 574/235-9371 ELIZABETH LEONARD FAX: 574/235-9697 574/235-9371 South Bend Common Council RE: Tax Abatement for Treadstone, LLC March 2, 2009 Page 2 Total taxes to be abated during the (5) five-year abatement period are estimated at $7,815. Total additional taxes to be paid as a result of the project during the five-year abatement period are estimated at $6,311. EMPLOYMENT IMPACT Per the petition, it is estimated that the project will create three (3) new, permanent full-time positions with an annual payroll $60,000. The project will also maintain four (4) existing permanent full-time positions and one (1) existing part-time position with a total annual payroll of $160,000. ABATEMENT QUALIFICATION 1. A review of the tax abatements previously granted finds that the Petitioner, Treadstone, LLC, has not been granted or associated with any previous tax 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 Airport Economic Development Area, which is a Tax Incremental Allocation Area; therefore, the petition for personal property tax deduction must first be approved by the South Bend Redevelopment Commission. 4. A review of the Tax Abatement Ordinance No. 9394-03 finds that the petitioner meets the qualifications fora (5) five-year personal property tax abatement under section 2-84.2, Tangible Personal Property Tax Abatement. 5 YEAR TREADSTONE, LLC. South Bend Portage Township Personal Property Tax Abatement Schedule* Tax Key Number Current Assessed Value: Estimated Project Cost: 18-2193-725701 0 200,000 2-Mar-09 40% 56% 42% 32% 24% Current 100% 80% 60% 40% 20% Assessed Value: AV & Tax Year 1 Year 2 Year 3 Year 4 Year 5 Current Assessed Value 100% 0 0 0 0 0 0 Base Assessed Value 80,000 112,000 84,000 64,000 48,000 Less Abatement Deduction (80,000) (89,600) (50,400) (25,600) (9,600) Net Assessed Value 0 0 22,400 33,600 38,400 38,400 Property Taxes: Assume constant tax rate of 4.3015% 4.3015% 4.3015% 4.3015% 4.3015% 4.3015% Gross Tax (tax rate x net assessed value) Less Circuit Breaker Credit Net Tax Circuit Breaker Cap Circuit Breaker Debt Service Circuit Braker Cap 0 0 964 1,445 1,652 1,652 0 0 0 0 0 0 0 0 964 1,445 1,652 1,652 3.0000% 0 2,400 2,400 2,400 2,400 2,400 0.5477% 0 0 123 184 210 210 0 2,400 2,523 2,584 2,610 2,610 New Combined Net Existing Project Existing ~ New Tax Tax Year Taxes Taxes Taxes Abated Paid 1 0 2,838 2,838 2,838 0 2 0 3,013 3,013 2,050 964 3 0 2,860 2,860 1,415 1,445 4 0 2,751 2,751 1,099 1,652 5 0 2,663 2,663 413 2,250 Totals 0 14,125 14,125 7,815 6,311 *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 PETITION FOR TANGIBLE PERSONAL PROPERTY TAX ABATEMENT CONSIDERATION The undersigned owner(s) of new manufacturing equipment, personal property, located within the City of South Bend, hereby petitions the Common Council of the City of South Bend for personal property (new manufacturing equipment) tax abatement consideration and pursuant to I.C., 6-1.1-12.1, et seg•, and South Bend Municipal Code Section 2-84.2, et seg•, for this petition states the following: 1. Describe the proposed project, including information about the new manufacturing equipment personal property (Aequipment@) to be installed, the amount of land to be used, if any, the proposed use of the equipment, and a general statement as to the value of the project to your business. New manufacturing equipment: Tire Shredding Machine - to be placed at existing location and to supplement existing equipment. This unit will_double our capacity to recycle solid rubber tires into rubber mulch. 99% of a used tire is recycled and put to use in various forms: rubber mulch for landscaping, curbing, tire derived fuel, pavement additive, etc. For every 40,000 pounds of tires that are recycled we save 1750 cubic feet of landfill space. 2. The project will create 3 new, permanent jobs within the first year, representing a new annual payroll of $ 60,000 and will maintain _ 4 existing permanent full-time and 1 existing part- time jobs representing an annual payroll of $ 160,000 The projected annual salaries for each new position created are estimated to be as follows: Production worker: $8.00 hour start, $8.50 after 30 day probation, with monetary reviews thereafter at 6 months and then annually. Overtime is at 1.5 Maintenance: $12.00+ per hour start, DOE 3. Estimate the total cost of the Equipment: $200,000 4. (a) The Equipment is owned or to be owned by the following individuals or corporations (if the business organization is publicly= held, indicate also the name of the corporate parent, if any, and the name under which the corporation has filed with the Securities and Exchange Commission): (Revised 8/2/02) 1 NAME ADDRESS INTEREST Treadstone LLC 445 N Sheridan St 100% (Revised 8/2/02) (b}The following other persons lease, intend to lease, or have an option to buy this Equipment (include corporate information as required in (4)(a) above, if applicable): N/A NAME ADDRESS INTEREST N/A 5. Give a brief description of the overall nature of the business and of the operations occurring at the location for which tax abatement is requested: Recycle solid rubber tires into rubber mulch of various sizes and weights depending upon use. 90% of our rubber produces +4, large premium size mulch that is primarily used in chilidren's playgrounds and landscaping. 6. The commonly known address of the property where the Equipment is to be located is: 445 N Sheridan St South Bend, In 46619 7. The Key Number of said property is: 18-2193-725701 8. Attach the legal description of the property where the equipment is to be located, marked AExhibit A,@ and is hereby incorporated herein. 9. Attach a map and/or plat describing the property where the equipment is to be located, marked AExhibit B,@ and is hereby incorporated herein. 10. Attach photographs of the property, taken within 30 days of filing of this petition, marked AExhibit C,@ and hereby incorporated herein. 11. The current assessed valuation of the tangible personal property to be replaced by the new manufacturing equipment is $ n/a -equipment will 6e addition to exisiting (This information may be obtained from the St. Joseph County Assessors office 235-9523) (Revised 8/2/02) 3 12. The current use of the real property where the Equipment is to be installed is GI -General Industrial and the current zoning is N/A (use) and N/A (height and area). (This information may be obtained from the Building Department 235-9553) 13.List the real and personal property taxes paid at the location during the previous five years, whether paid by the current owner or a previous owner: YEAR REAL PROPERTY TAXES PERSONAL PROPERTY TAXES 2008 18,046.24 2007 36,092.48 2006 11,910.16 2005 18,810.96 2004 17.396.59 (This information may be obtained from the St. Joseph County Treasurers office 235-9531) 14. Describe the commitment made within the past five years by your firm to hiring minority individuals, including number of minorities employed during each of the past five years, specifying whether full time or part-time and whether permanent or temporary employees. The Petitioner shall also list the current number of total employees (full and part-time) and the current number of minority individuals (full and part-time). Current employees: 4 Ft/1Pt 2ft Hispanic/1 at hispanic. Supervisor is Hispanic. In the past year of current ownership we have participated in Govenor Bayh's annual iob fair held at IUSB and all of our openings are posted with Work One 15. Describe on-site child care or day care facilities, services or benefits currently offered or proposed to be offered by the Petitioner for children of employees. B_y year end of 2009 we are planning on offering family health insurance (Revised 8/2/02) 4 16. What is your best estimate of the market value of the new Equipment after installation?$ 200,000 17. What is your best estimate of the amount of taxes to be abated during each of the five years after installation? $ As per Mr. Mathia - ok to leave blank 18. What is the commitment your firm will make to minority employment during the five years of tax abatement? We will post all positions with Work One and are committed to hiring qualified candidates through their process. 19. The Equipment has not been installed as of the date of filing of this petition. (The signature at the end of this Petition is verification of this statement) 20. The standard Industrial Classification Manual major group within which the proposed project would be classified, by number and description: 5093 -Scrap & Waste Material 21. The Internal Revenue Service Code of Principal Business Activity by which the proposed project would be classified, by number and description: 339100 22. The real property where the Equipment will be installed is located in the following Allocation Area, if any, declared and confirmed by the South Bend Redevelopment Commission: None 23. Other anticipated public financing for the project including, if any, industrial revenue-bonding to be sought or already authorized, assistance through the United States Department of Housing and Urban Development funds from the City of South Bend, Small Business Association Sections 503 and 504 financing through the Business Development Corporation of South Bend, Mishawaka, and St. Joseph County, Indiana; or other public financial assistance, including but not limited to public works improvements. (Revised 8/2/02) S and St. Joseph County, Indiana; or other public financial assistance, including but not limited to public works improvements. Proiect financed commercially through local bank which did access funding via SBA underwriting 24. Describe how and why the manufacturing equipment to be replaced or the facility in which Equipment will be added is currently technologically, economically or energy obsolete and how and why that obsolescence may lead to a decline in employment and tax revenues: No equipment is bein replaced. This is a start up business and for the past 2 years manufacturing has been running off prototype equipment which is not built to withstand the rigors of a 2 shift daily production schedule. This new equipment will run alongside the prototypes and will double production as well as ease the burden on the 3 existing machines. Without this equipment we will not be able to maintain our current level of production due to the wear on the prototypes which would mean a layoff of second shift. With this equipment we will hire 3 more people for our existing operation and may open a 3~d shift in the future. 25. The new manufacturing equipment will be used in the direct production, manufacture, fabrication, assembly, extraction, mining, processing, refining, or finishing of other tangible personal property and that the equipment was never before used by its owner for any purpose in Indiana. The signature at the end of this Petition is verification of this statement. 26. The following person(s) should be contacted as Petitioner=s agent regarding additional information and public hearing notifications: Name: Kenn Andrews & Mark Sanderson Address: 445 N Sheridan St City, State, Zip Code: South Bend, In 46619 Telephone: 574-234-9520 WHEREFORE, Petitioner requests that the Common Council of the City of South (Revised 8/2/02) 6 Bend, Indiana, adopt a declaratory resolution designating the area described herein to be an economic revitalization area for purposes of tangible personal property taz abatement consideration, and after publication of notice and public hearing, determine qualifications for an economic revitalization area have been met, and confirm such resolution. Petitioner herein hereby verifies that the required $250.00 filing fee to cover processing and administrative costs pursuant to Section 2-84.7 of the Municipal Code of the City of South Bend has been paid in full. Name of Property Owner(s): Kenn Andrews & Mark Sanderson By: (Signed Name) !~e_.~r A `"~~+RCaP f' ~('M- ~y'f1tY1f~~'ic.-~-~ ~ (Typed or printed name and capacity of signor if signed by an agent or representative of the owner) (Revised 8/2/02) Filed In Clerk's office FEB 2 7 20C9 ,~ JONII VgtC? RBE ~D, IN. CT[Y CLERK, EXHIBIT A LEGAL DESCRIPTION Description: 371.5 Ft on Linden Ave, Beginning 277 Ft West and 60 Ft North Southeast Corner of Southwest Section 4-37-2E Tax Key No.:18-2193-75701 Address: 445 North Sheridan Street South Bend, IN 46619 a...~ i agc Page 1 of 1 City of South Bend Online GIS 18-2193-725701 ll C~anterbUry r I _._ ..-_.L-____ Ardmore ~ - ~. U -_,~__,__ ~ -_----Prast (f ~'I It w p ~~ s 11 ~I _. .N'. , o_ QoS~mo~~ch f--_.:.: C~ i m . _ i ~ ! ~-•'- iry!Ridgew ay - --- L' f1 (f of N~ ~ 't'i ~~ ,,~:~ d~ W, Q~ . J ~ ~ :: I 4. '••.3~ '-._1Vindsor Gdrgren .cl --- ~~^ ~ - ---- I`----i - Iv1approvided by The City of South Bend GIS - 2007 ""Set .. i Property 18-2193-725701 445 N Sheridan Owner MICHIGAN COMPOSITES INC South Bend IN 46619 ~~~ v' C i ~. ..`l° ~~ ~.~~~'t~e~e FEB 2 ~ 2009 Prast ! WestrnooK : ~ ; ~ ~ ~ - _ ~ ~ I ~~ ~, yi ~~ C, C O' ~~ ~~ - E! "' ~ Y o ~ _~ LaSa//e Park ;i _~, ~~~ ~; ~~~ i f Washin ton; ~;-- -9----------------`_--- --______--- ~ ~ 833 Feet ! -~ ~ ~°' _ ~; o ~; i Author. Kenn Andrews Copyright 2007 The City of South Bend Bureau of GIS Online Mapping ~ ~~ ~,Ot Tt1IlF,1,J ~` . _ •r. ^-.,Y ..~ r s IS65 ,~„ U •,,, ,' ~ ~'' n - Ci7`! ~? d Jv;~iTdc ~:~. _ ,r http://southbend,in.schneidercorp.com/gis/print/41.asn?nRTAn =vnr o_,,,-,.T , „ .. _ .. _ .. CI+