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REGULAR MEETING JANUARY 24, 2011
<br /> Mr. Michael Calhoun, McCormick and Company, Inc., 3425 West Lathrop Drive, South
<br /> Bend, Indiana, made the presentation for these bills.
<br /> Mr. Calhoun advised that on July 26, 2010, the Common Council approved Designating
<br /> Resolutions for real and personal property tax abatements for the subject firm. The
<br /> property will be located at 3425 West Lathrop Drive. At the time the Designating
<br /> Resolutions were considered they had not completed the list of construction contractors
<br /> and suppliers for its proposed project as called for in the real property petition forms. In
<br /> approving the Designating Resolution for real property it was noted that they could
<br /> qualify for up to a nine-year abatement term. He noted that they agreed to provide the
<br /> required information prior to the Council considering its real property confirming
<br /> Resolution. Consideration of the Confirming Resolutions for both tax abatements was
<br /> held in abeyance pending receipt of the required information. Mr. Calhoun stated that
<br /> they have now completed the list of contractors and suppliers for construction of the
<br /> addition and submitted it. He stated that after review by the Department of Community
<br /> & Economic Development it was determined that the project qualifies for an eight (8)
<br /> year real property tax abatement. Mr. Calhoun stated that however, due to an increase in
<br /> customer demand they had to enlarge the project. The project originally entailed the
<br /> construction and equipping of a 50,000 square foot addition to the manufacturing facility.
<br /> The cost of construction was estimated at $5,010,913 and equipment procurement was
<br /> estimated at $875,173 for a total project cost of$5,886,086. The equipment includes fork
<br /> lifts, coolers, racking, computers and furniture and fixtures. The addition is intended to
<br /> house a distribution operation for the products McCormick makes. The products include
<br /> condiments (ketchup, mustard, salad dressing, etc.) for major restaurant chains. During
<br /> initial discussions the company was also considering alternate sites in Michigan Illinois
<br /> and other states to locate the distribution operation. After the Designating Resolutions
<br /> were approved McCormick selected South Bend. Since then an increase in business
<br /> volume from their main customers has caused the company to increase the size of the
<br /> project by adding 25,000 more square feet to the addition at a cost of $884,071 and
<br /> providing more equipment at a cost of$487,000. The revised cost of construction is now
<br /> estimated at $5,894,984 and the equipment procurement is estimated at $1,362,173 for a
<br /> new total project cost of $7,257,157. However, the goals and objectives of the project
<br /> remain the same as those originally presented for the Designating Resolutions. Based on
<br /> an eight-year term the total estimated real property taxes to be abated on the revised
<br /> project are $784,181. Total additional real property taxes to be paid as a result of the
<br /> revised project during the eight-year abatement period are estimated at $868,820. For the
<br /> equipment, the total estimated personal property taxes to be abated on the revised project
<br /> during the personal property five-year abatement term are $10,073. Total additional
<br /> personal property taxes to be paid as a result of the revised project during that same term
<br /> are estimated at $103,084. Mr. Calhoun stated that the total project will create five (5)
<br /> new, permanent, full-time jobs within the first year of the project representing a new
<br /> annual payroll of approximately $177,247. The project will retain one hundred twenty-
<br /> three (123) existing permanent, full-time jobs (of which 30 are minority employees) with
<br /> an annual payroll of$6,288,998.
<br /> A Public Hearing was held on the Resolutions at this time.
<br /> There was no one present wishing to speak in favor of the Resolutions at this time.
<br /> The following individuals spoke in opposition to the Resolutions:
<br /> Mr. Murray Miller 1201 Priscilla Drive, South Bend, Indiana, spoke in opposition to the
<br /> Resolutions. Mr. Miller advised that they were not using a local construction company.
<br /> Mr. Kevin Wildes, representing the Plasterers, Masonry Union, stated that the materials
<br /> being used are coming from Michigan and not Indiana. He also questioned why they
<br /> were not using local people for the construction.
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