HomeMy WebLinkAbout2007-R-25
RESOLUTION NO. 2007-R- ~6
RESOLUTION APPROVING STATEMENT OF BENEFITS FOR
PURPOSES OF PERSONAL PROPERTY TAX ABATEMENT
WHEREAS, Becker Acroma, haspetitioned the Common Council of the City of
Jeffersonville, Indiana, for a deduction in real property taxes to be assessed on a proposed
new facility to be located in the Bridgeport Business Center located in the City of
Jeffersonville, Clark County, Indiana; and
WHEREAS, Becker Acroma, has submitted a Statement of Benefits on the form
prescribed by the Indiana State Board of Tax Commissioners for such purpose, which
statement includes a description ofthe proposed redevelopment, an estimate of the
number of individuals who will be employed as a result of the redevelopment, an
estimate of the annual salaries of these. individuals, and an estimate of the value of the
redevelopment; and
WHEREAS, the Common Council of the City of Jeffersonville has previously
determined that the area in which the proposed redevelopment project is located in the
City of Jeffersonville qualifies as an economic revitalization area pursuant to Indiana
Code 6-1.1-12.1-5, et seq., and Resolution 97-R-10, and confirming Resolution 97-R-14;
WHEREAS, the Common Council has reviewed the Statement of Benefits and its
attachment "A" submitted herein, and attaches and incorporates the Statement of Benefits
submitted herein, and attaches and incorporates the attachment "A" to this Resolution.
NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of
Jeffersonville, Indiana, that it specifically and affirmatively finds as follows:
1. That the estimate of the value of qualifying manufacturing equipment of
$1,592,245 is reasonable for projects of the nature described in the Statement of
Benefits submitted by the company.
2. That the estimate of the number of38 individuals who will be additionally
employed can reasonably be expected to result from the proposed described
redevelopment or rehabilitation.
3. That the estimate of the annual s~laries of$1,387,000 of those individuals who
will be added can be reasonably expected to result from the proposed described
redevelopment or rehabilitation.
4. That the purchase and installation of the qualifying manufacturing equipment~~st
... J1~9ompleted wi thin. thiee.(3)"ygats'-ttBtrFt1ie(f(lieQ.fJb~ granted abateme)Jt~;f"
5. That the taxes lessened from the granting of this abatement shall be used for
manufacturing equipment utifir:5;!hep:urchasepriceof$1,592,245...
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6. That all other information requested from Becker Acroma, has been submitted,
and the benefits described in sUyh information can be reasonably expected to result
from the proposed described redevelopment.
7. That the totality of benefits for said redevelopment is sufficient to justify the
deduction.
8. That Becker Acroma has agreed to the payment of a fee of 10% of the annual
benefit of the abatement to the Jeffersonville City Council annually as described in
IC 6-1.1-12.1-14.
BE IT FURTHER RESOLVED, that the Common Council of the City of
Jeffersonville, Indiana, hereby approves the application for deduction presented
by the Statement of Benefits filed by Becker Acroma, and that said company
shall be entitled to deductions for a period of five (5) years on qualifying personal
property pursuant to the provisions ofIC 6-1.1-12.4 for personal property, with
the timely filing and perfection thereof with the Clark County Assessor's office
Passed and adopted thisJb day of~u..t, 2007, by the Common Council of
the City of Jeffersonville, Clar~~
President, Common ~ncil
ATTEST:
Q~/O ~
Peggy Wilder, Clerk-Treasurer
Presented by me as Clerk-Treasurer to the Mayor of the City of Jeffersonville,
Indiana, this ;1 yvlv day of a::oA-d-t ,2007
(2/ffd ~
Peggy Wilder, Clerk-Treasurer
This
, 2007
Robert L. Waiz, Jr., Mayor
ATTACHMENT "A"
ATTACHMENT TO 1;'HE STATEMENT OF BENEFITS
FOR Becker Acroma
August 6, 2007
The council will grant 5-year abatement on an amount not to exceed $1,592,245 in
personal property as allowed by state statute. This applies to qualifying new
manufacturing equipment purchased and installed after the abatement is granted and is
subject to the dollar limit specified above. This abatement will only apply to personal
property purchased and installed in the first 36 months following the granting of
abatement, whose purchase price does not exceed $1,592,245. The abatement period
of five years will begin in the first year used for any personal property abatement and
will continue for four additional years. Personal property, subject to abatement,
installed in later years will receive abatement for the remaining years of the original
five year period.
The company will provide at least 38 jobs with at least $1,387,000 in salaries as
specified in the Statement of Benefits and any attachment thereto. The "salaries" on
the SB-I is agreed to mean base hourly wages, without overtime or benefits, times
2050 hours per year for the number of employees as indicated in Section 3 of the SB-.
1. It is the expectation of the Coun<;il that the company will reach the number of
employees and average wages specified within three years of the date of the granting
of the abatement. The company, Becker Acroma, understands that this abatement is
being offered based upon those jobs and wages promised by the company. If the
company fails to reach those numbers or fails to maintain those numbers over the life
of the abatements, the company agrees and understands that the Council will, unless
prohibited by Indiana law, rescind these abatements and require the company to pay
back, at a pro-rata rate the real and personal property taxes that have been abated.
The company agrees to make availahle any and all information the council deems
necessary to verify compliance.
The company agrees to pay an annual fee of 10% of the amount of real property taxes
abated during each year of the abatement as described in Indiana Code 6-1.1-12.1-14.
Becker Acroma
Tax Abatement Advisory Review
Department of Redevelopment
Firm:
Date:
Becker Acroma Corporation
August 6, 2007
1.
All information .as required in 37.01(B)(1)-(12) has not been submitted.
(5) Requires the amount of real and personal property taxes paid during
previous three years. This is a new construction, and no taxes have been
paid on this property.
(9) Requires certification no building permit has been issued. No
statement has been provided. Through conversations with John Walling,
the Project Manager from Koetter Construction/Real Estate, he assures
me Becker Acroma is well aware the abatement must precede any
construction and/or installation.
2. The information in the petition indicates all requirements have been met
with the two above exceptions. I would not consider them to be material.
3. The project area is in a TIF.
4. The project area is in an Economic Revitalization Area.
5. The project is not in an Economic Development Target Area.
6. The Department of Redevelopment supports the approval of Becker
Acroma's petition based on the following criteria:
6(b)-(c). The number of jobs and the annual salaries can be reasonably
expected to result. The amount of abatement per job would be
$6,864.04 or an average of $686.80 per job per year.
The total amount abated on Real Estate over ten years would be
$203,784.04. The total amount abated on Personal Property over
five years would be $57,201.61.
The average hourly rate (per worker) would be $17.80 or $36,500
annum.
The $1,387,000 payroll would produce $138,700 in CAGIT, and
$34,675.00 in EDIT. The Real Estate taxes paid over ten years
would be $207,900.89, and Personal Property taxes paid would be
$35,399.36.
The Council's established guidelines indicate the maximum total
abatement for $30,000 per year jobs is $10,000 per job. This abatement
proposal is for $6,868.04 per job, and meets the Council's criteria.
The fee paid to the Jeffersonville City Council will be 10% of the total
taxes abated, and will amount to approximately $2,609.86 per year. This
fee is based on a fee schedule tied to total investment, and approved by
the City Council Abatement Committee in 2006.
The Department of Redevelopment recommends a ten year abatement on
real estate.
Incentive to Business
Per 38 jobs
10 year Real is
$203,784.04
$160,557.12
$5,362.74
$4,225.19
5 year Real is
The Department of Redevelopment recommends a five year abatement on
personal property.
Incentive to Business
Per 38 jobs
5 year PP is
$57,201.61
$47,277.29
$1,505.31
$1,244.14
3 year PP is
City of Jeffersonville Tax Abatement Worksheet
Firm: Becker Acroma
TEN YEAR REAL PROPERTY
Cost
A V @ 80% $2,100,000
Gross Rate
PTRC
Net Rate
0.019604044
Year's Tax
$
41,168.49
FIVE YEAR PERSONAL PROPERTY
Pool Life
Cost
PP PTRC
NET RATE
Wages Per Job
WIO OT Average Hourly Rate
$36,500.00 $17.80
Current Yr TTV
% from Form Assessed Value
Taxes Paid Taxes Abated 103 Schedule A or TTV
Year 1 $ $ 41,168.49 40 $636,898.00
Year 2 $ 2,058.42 $ 39,110.07 60 $955,347.00
Year 3 $ 8,233.70 $ 32,934.79 55 $875,734.75
Year 4 $ 14,408.97 $ 26,759.52 45 $716,510.25
Year 5 $ 20,584.25 $ 20,584.25 37 $589,130.65
Year 6 $ 24,701.10 $ 16,467.40
Year 7 $ 28,817.94 $ 12,350.55
Year 8 $ 32,934.79 $ 8,233.70
Year 9 $ 37,051.64 $ 4,116.85
YearlO $ 39,110.07 $ 2,058.42
$ 207,900.89 $ 203,784.04
Fee Table
Total Investment Base
$
$ 500,001.00
$ 1,000,001.00
$ 10,000,001.00
$ 50,000,001.00
Total Taxes Abated Abatement Per Job Total Investment
$ 260,985.65 $ 6,868.04 $ 4,217,245.00
Real Property Personal Property CAGIT
$ 207,900.89 $ 94,007.57 $
% Paid to
City Council
15%
12%
10%
7.5%
5%
Fee %
10%
Taxes Paid
Taxes Abated
$0.00
$4,688.66
$8,595.87
$10,549.48
$11,565.35
$15,628.86
$18,754.63
$12,893.81
$7,032.99
$2,891.34
$35,399.36
$57,201.61
Total Fee Paid
to Council . .Fee per year
~$ 2,609.86
EDIT Ten Years Yearly Thereafter
138,700.00 $ 34,675.00 $ 475,283.46 $ 70,227.63
ATTACHMENT "A"
ATTACHMENT TO T;HE STATEMENT OF BENEFITS
FOR Becker Acroma
August 6, 2007
The council will grant 10-year abatement on an amount not to exceed $2,625,000 in
real property as allowed by state statlJ.te. This applies to qualifying new construction
after the abatement is granted and is subject to the dollar limit above. This abatement
will only apply to real property constructed in the first 36 months following the
granting of abatement.
The company will provide at least 38 jobs with at least $1,387,000 in salaries as
specified in the Statement ofBenefit~ and any attachment thereto. The "salaries" on
the SB-1 is agreed to mean base hourly wages, without overtime or benefits, times
2050 hours per year for the number qf employees as indicated in Section 3 of the SB-
1. It is the expectation of the Council that the company will reach the number of
employees and average wages specified within three years of the date of the granting
of the abatement. The company, Becker Acroma, understands that this abatement is
being offered based upon those jobs and wages promised by the company. If the
company fails to reach those numbers or fails to maintain those numbers over the life
of the abatements, the company agrees and understands that the Council will, unless
prohibited by Indiana law, rescind these abatements and require the company to pay
back, at a pro-rata rate the real and personal property taxes that have been abated.
The company agrees to make available any and all information the council deems
necessary to verify compliance.
The company agrees to pay an annual fee of 10% of the amount of real property taxes
abated during each year of the abatement as described in Indiana Code 6-1.1-12.1-14.
Becker Acroma