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REGULAR MEETING April 8, 2019
<br /> DESIGNATING CERTAIN AREAS WITHIN THE
<br /> CITY OF SOUTH BEND, INDIANA,
<br /> COMMONLY KNOWN AS 1545 S. OLIVE
<br /> STREET, SOUTH BEND, IN 46619 AN
<br /> ECONOMIC REVITALIZATION AREA FOR
<br /> PURPOSES OF A (5) FIVE-YEAR PERSONAL
<br /> PROPERTY TAX ABATEMENT FOR
<br /> MOLDING PLASTICS, LLC
<br /> Councilmember Gavin Ferlic, chair of the Community Investment Committee, reported that they
<br /> met this afternoon and send this bill forward with a favorable recommendation.
<br /> Dan Buckenmeyer, Director of Business Development for the Department of Community
<br /> Investment with offices located on the 14th floor of the County-City Building, South Bend, IN,
<br /> served as the presenter for this bill. Mr. Buckenmeyer stated, If it pleases the Council, we have
<br /> seven (7) tax abatements coming before you all. I will give a very brief overview of all of those
<br /> and then come back and do each one(1)individually. We have seven(7)projects coming forward
<br /> today and I just wanted to present a little bit of the whole picture of what is happening here and
<br /> explain, again,tax abatements. There is a tendency for some folks to think, oh my goodness,we're
<br /> giving something away when,really,it is purely upside.We are looking at properties,as the second
<br /> (2'')bullet point denotes(referencing a slide in a presentation which is available in the City Clerk's
<br /> Office), with a current tax contribution of about $147,000 a year. With the approval of these
<br /> abatements, these same properties would, within a decade's time, begin contributing an estimated
<br /> $1.3 million per year to the tax rolls. This is how tax abatements work. We give businesses an
<br /> incentive and a bit of a break for a few years in their property taxes that allows them to invest and
<br /> invest heavily. Again, we have seven (7) tax abatements that total over $60 million of private
<br /> investment coming into our community. We have six hundred and six (606)jobs being retained in
<br /> our community. We are adding over sixty (60) jobs. Now, again, as I noted this afternoon, that
<br /> doesn't feel like a lot but those are only the direct jobs associated directly with these projects. A
<br /> few of these projects are spec projects, in other words, buildings being built for a future tenant.
<br /> Our history is good with these. Our last three (3) spec buildings garnered about seven hundred
<br /> (700) employees for the City. So, when you look at them globally, it's a great investment and
<br /> opportunity for South Bend to provide these incentives for these individuals. Again, as it shows
<br /> from bottom to top (referencing a slide in the presentation),the 2018pay2019, our current tax base
<br /> is lower than $200,000 a year. It's going to escalate approaching $2 million a year as we go into
<br /> the next decade with that.
<br /> Mr. Buckenmeyer continued, With that, Molding Plastics LLC is a wonderful company that has
<br /> been around for forty (40) some years in the City of South Bend. They are looking to expand.
<br /> They've already done the real property side of their investment.They've invested about$5 million
<br /> in land and building which will house the equipment,which is the topic of this tax abatement. This
<br /> is a personal property tax abatement, giving them a break on personal property taxes on capital
<br /> equipment. It is expected to be about a $5 million investment in order to, again, increase their
<br /> production capacities. By increasing that production capacity, they are adding twenty (20) new
<br /> jobs,retaining forty-five(45), and they are good paying jobs that average eighteen dollars per hour
<br /> ($18/hour)wages.As an interesting side note,again,this company is a plastics manufacturer.Their
<br /> raw materials find their way to end use in everything from bathtubs to my favorite Corvettes. This
<br /> is a great legacy company here in the City and I am happy to support them. Troy and Tim are here
<br /> as petitioners as well.
<br /> Councilmember Karen White stated, I would first(1St)like to thank you for your development and
<br /> your support in terms of working with the City and the Administration, but I would like to hear
<br /> about the role this incentive has played to help make your decision to expand your business here
<br /> within the City of South Bend.
<br /> Troy Wade, 1545 South Olive Street, South Bend, IN, stated, I'm the Vice President and General
<br /> Manager of Molding Plastics LLC. I would say that we had plans in doing it, but the plans might
<br /> have been delayed until we could come up with the funds to pay for it. We would have done it in
<br /> stages. So, employing twenty (20) new people would come later. More production would come
<br /> later. My hope is that we would have done it anyway, but it would have taken much longer.
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