EATON — The Preble County Board of Commissioners met last week with officials from the Village of Lewisburg representing the village’s Community Reinvestment Area Tax Incentive Review Council, for an annual meeting to discuss continuance of CRA agreements with DM Tool & Plastics and Pratt (Lewisburg Corrugating) LLC.
The groups meet once per year to ensure companies are complying with what they promised to receive the tax abatements offered under the CRA agreements. The most recent meeting was held on Monday, March 15.
A CRA, according to Rick Faber, serving as Lewisburg’s housing officer, is a “geographically mapped area within a township or a municipality that has been sanctioned by the Ohio Department of Developmental Services to offer tax abatements to manufacturing industries who want to expand their factory, or set up a new factory, in the geographic area that is covered by the district. In return for the tax incentives given, a company makes a commitment to that community to build a factory, employ people, and engage in trade and manufacturing, as well as provide trade in the general vicinity — as a matter of people stopping at gas stations and banks and so forth.”
“Its goal is to add jobs, progress, manufacturing and trade to the entire state of Ohio.” Faber said. “To get these, a company has to be job oriented,” he added. “Creation of jobs is one major goal, and it cannot be a situation where they close down a factory in Springfield, and bring the people over here to, in this case, Lewisburg, Ohio, to do the job. That’s a no-no.
“Now, if they do it from Indianapolis to here, that’s okay, because Ohio is getting the jobs,” he explained.
According to Faber, the amount of the abatement Lewisburg can give a manufacturing plant is up to 15 years.
“And it is 50 percent maximum without the consent of the school district, and with the consent of the school district can be up to 100 percent,” he said.
The tax abatement is “against the ‘improved value’ of the real estate that was pre-existing prior to the agreement,” Faber noted.
Agreements are approved by the county commissioners, the Lewisburg Village Council, and then submitted to the Ohio Department of Development Services.
According to Faber, this year DM Tool has received an abatement of $14,782.81 and a running total, since approximately 2012 of about $109,000. “For Pratt Industries, their abatement for the current year is $172,481.53, and accumulative now, over a million — last year was just under a million,” he said.
Faber explained, in return for a 15 percent abatement, agreed to construct a 35,000 square foot addition to an existing industrial building. The price was $1,000,002. Construction had to be completed by February of 2013.
“They fulfilled that commitment — they constructed it and they completed it on time,” he said. The company did not agree to add any new jobs but did agree to retain 27 current jobs. The building expansion nearly doubled the company’s facility size, and the company has increased its full-time payroll.
Pratt Industries made more commitments than DM Tool, Faber continued, because it was a bigger project. Pratt made seven commitments, including constructing a 35,000 square-foot industrial building at a price tag of $15 million to be completed by Sept. 30, 2014 and purchasing new machinery and equipment with a price tag of $29 million.
“They agreed to purchase furniture and fixtures, at a price tag of $1 million, and they agreed to try to maintain an inventory of about $7 million,” Faber continued. Pratt also agreed to create 140 new full-time jobs by September 2015 and an additional 30 by September 2016. An additional $8 million in payroll was to be created. One goal, but not a CRA requirement, was to have 25 percent of the new jobs filled by residents of the Tri-County North Local School District.
The group approved two resolutions, one finding DM Tool & Plastics in compliance and continuing the CRA agreement, and one finding Pratt Industries in compliance and continuing its CRA agreement.
Later during their meeting on Monday, March 15, commissioners met with officials representing the Eaton Community Reinvestment Area Tax Incentive Review Council and approved continuance of a CRA agreement with TimkenSteel.
Joe Ferriell represented the city as its housing officer. According to Ferriell, TimkenSteel was to construct an $8.9 million facility and hire 11 people. The building was completed in 2018, he reported, and the company is meetings its employment goal.
“This year, their abatement is going to be $1,648.22, and they’ve accumulated over the three-year period so far, $5,138,” Ferriell said.
“The $2,000, momentarily might not make a lot of difference to TimkenSteel,” City Manager Brad Collins noted. “But this was a competitive project with some other areas within TimkenSteel, so for us to go through this effort, that sort of shows them that they’re important — for them to be here and grow here — so I think it’s more about us putting effort forward than it is $2,000.”
As with Lewisburg’s, the approved CRA agreement between Eaton and TimkenSteel will be taken before Eaton City Council and then submitted to ODDS.
Reach Eddie Mowen Jr. at 937-683-4061 of follow on Twitter @emowenjr