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HomeMy Public PortalAbout029-2006 - Tax Abatement Guidelines for IndustAMENDED ORDINANCE NO. 29-2006 AN ORDINANCE CREATING TAX ABATEMENTS FOR VACANT INDUSTRIAL FACILITIES WHEREAS, The Common Council of the City of Richmond, Indiana has previously established an Economic Development Plan for the City in Resolution 1-1984 which deemed it necessary and beneficial to stimulate private investment and to provide for the creation and/or retention of job opportunities; and WHEREAS, Pursuant to Indiana law, I.C. 6-1.1-12.1 et. seq., the Common Council for the City of Richmond has designated areas within the City as Economic Revitalization Areas, which provide as an economic development incentive certain property tax deductions for the redevelopment or rehabilitation of real property; and WHEREAS, For purposes of this Ordinance, a "vacant industrial facility" is defined as a tract of land on which there is located a plant that has at least Twenty Thousand (20,000) square feet of floor space; was placed in service at least twenty (20) years ago and has been vacant for two (2) or more years unless the tract and the plant are owned by the City of Richmond, in which case the two (2) year requirement does not apply. WHEREAS, A number of vacant industrial facilities exist in Richmond whose recovery would be economically beneficial to the City of Richmond; and WHEREAS, It is desirable to assist in any way reasonably possible with the economic development of vacant industrial facilities in Richmond; and WHEREAS, Pursuant to Indiana law, I.C. 6-3.1-11 et seq., the Industrial Recovery Tax Credit statute, certain vacant industrial facilities are eligible for an industrial recovery tax credit by the state of Indiana; and WHEREAS, It has become extremely difficult for normal development or rehabilitation of vacant industrial facilities due to cessation of growth, deterioration of improvements, and/or the character of occupancy and/or age of the buildings; and WHEREAS, The Department of Metropolitan Development of the City of Richmond has recommended that the City of Richmond create tax abatements for vacant industrial facilities as defined above and in the findings below; and WHEREAS, Common Council desires to now create tax abatements for vacant industrial facilities under criteria set forth in this Ordinance for vacant industrial facilities that are otherwise not eligible for tax abatement or tax credit under the state's Industrial Recovery Tax Credit statute. NOW, THEREFORE, be it ordained by the Common Council of the City of Richmond, Indiana, as follows: 1. Definitions as used in this Ordinance: a. "Floor space" means the usable interior floor space of a building. b. "Industrial recovery site" means an industrial recovery site designated under this Ordinance. c. "Placed in service" means that property is placed in a condition or state of readiness and availability for a specifically assigned function. In the case of a plant comprised of a complex of buildings, the entire plant shall be considered to have been placed in service as of the date that a building was placed in service if the building has floor space that, when aggregated with the floor space of all buildings in the complex placed in service on earlier dates, exceeds fifty percent (50%) of the total floor space of all building in a complex. d. "Plant" means a building or complex of buildings used, or designed and constructed for use, in production, manufacturing, fabrication, assembly, processing, refining or finishing. e. "Qualified investment" means the amount of the taxpayer's expenditures for rehabilitation of property located within an industrial recovery site under a plan contained in an application approved by Common Council. An expenditure for purposes or by persons not covered by such a plan may not be a qualified investment. f "Rehabilitation" means the remodeling, repair, or betterment of real property in any manner or any enlargement or extension of real property g. "Taxpayer" means any person, corporation, limited liability company, partnership, or other entity that has any tax liability and that is the owner or developer of an industrial recovery site. h. "Vacant" means with respect to a plant that at least seventy-five percent (75%) of the plant placed in service is not used to carry on production, manufacturing, assembly, processing, refining or finishing. i. "Vacant industrial facility" means a tract of land on which there is located a plant that: (1) Has at least Twenty Thousand (20,000) square feet of floor space; (2) Was placed in service at least twenty (20) years ago; and (3) Has been vacant for two (2) or more consecutive years immediately prior to the application for abatement unless the tract and the plant are owned by the City of Richmond or Wayne County, in which case the two (2) year requirement does not apply. 2. Tax abatements granted by the City of Richmond for personal property abatement and real property abatement for qualifying companies or businesses are hereby extended to a "taxpayers" of "vacant industrial facility". 3. For a taxpayer of a vacant industrial facility to receive a tax abatement in the City of Richmond, the taxpayer must file a Statement of Benefits (SB-1) form and SB-IA, City of Richmond supplemental form, before new equipment is installed or improvements are made to real property. 4. So long as the industrial recovery site is located in one of the City of Richmond's designated Economic Revitalization areas, a taxpayer of a vacant industrial facility may request a tax abatement from one (1) year up to ten (10) years. 5. Common Council has the sole discretion as to determining the number of years in which to grant a tax abatement to a taxpayer of a vacant industrial facility. The determination of the Common Council is based on the estimated value of the vacant industrial facility project, the number of jobs created or retained, the employees' annual salaries or wages and other benefits. 6. Once a taxpayer of a vacant industrial facility has been approved by Common Council for a tax abatement, the taxpayer of a vacant industrial facility must meet the following requirements in order to receive or continue to receive the tax abatement granted to the taxpayer: a. File an annual compliance with statement of benefits (CF-1) form with the City of Richmond's Department of Metropolitan Development and the Wayne County Auditor's Office to show the extent of compliance with the Statement of Benefits. b. Taxpayers of a vacant industrial facility receiving real estate and improvements deductions must file form CF-I with the initial deduction application and then annually by May 15, or by the due date for the real property owner's personal property return that is filed in the township. C. Taxpayers of a vacant industrial facility receiving deductions on new manufacturing equipment must file form CF-I with form 322 ERA/PP between March 1 and May 15 of each year. 7. Failure of a taxpayer of a vacant industrial facility to meet the requirements set forth in paragraph 6 above may result in their tax abatements being withdrawn by Common Council. The determination of Common Council to withdraw or keep tax abatements for a taxpayer of a vacant industrial facility who fails to comply with the requirements of paragraph 6 is by a majority vote of the members of Common Council. 8. This Ordinance shall take effect upon passage. Passed and adopted this _20th_ day of _March 2006, by the Common Council of the City of Richmond, Indiana. S/S Karl Sharp President (Karl Sharp) ATTEST: _S/S Karen Chasteen City Clerk (Karen Chasteen) PRESENTED to the Mayor of the City of Richmond, Indiana, this _21 st_ day of _March 2006, at 9:00 a.m. _S/S Karen Chasteen City Clerk (Karen Chasteen) APPROVED by me, Sarah L. Hutton, Mayor of the City of Richmond, Indiana, this _21 st day of March , 2006, at 9:05 a.m. S/S Sarah L. Hutton Mayor (Sarah L. Hutton) ATTEST: _S/S Karen Chasteen City Clerk (Karen Chasteen)