HomeMy Public PortalAbout024-2019 - Tax Abatement - Purina - EquipmentCOMMON COUNCIL OF THE CITY OF RICHMOND, INDIANA
ORDINANCE NO. 24-2019
A SPECIAL ORDINANCE AUTHORIZING THE APPROVAL OF A
STATEMENT OF BENEFITS FORA PROPERTY OWNER
APPLYING FOR DEDUCTIONS UNDER I.C. 6-1.1-12.1
WHEREAS, Common Council has previously designated eight economic revitalization areas
within the City of Richmond; and
WHEREAS, I.C. 6--1.1-12.1 requires the Common Council as the designating entity to approve
all Statements of Benefits required to be filed by property owners applying for
deductions in assessed valuations for the installation of new manufacturing
equipment, research and development equipment, logistic distribution equipment,
or information technology equipment or for the redevelopment or rehabilitation of
real property; and
WHEREAS, An owner of real property located in an economic revitalization area is entitled to
deductions from the assessed value, pursuant to Indiana law and Richmond City
Ordinance, for a period of any number of years less than or equal to ten (10) years
(i.e. one to ten years); and
WHEREAS, -An owner of new manufacturing equipment, research and development
equipment, logistic distribution equipment, or information technology equipment
is also entitled to deductions from the assessed value, pursuant to Indiana law and
Richmond City Ordinance, for a period of any number of years less than or equal
to ten (10) years (i.e. one to ten years); and
WHEREAS, In order for Common Council to approve a Statement of Benefits to allow a
deduction, it must make the following findings, to -wit:
1. That the estimate of value of the redevelopment or rehabilitation, as to real
property, or the estimate of cost of the new manufacturing equipment,
research and development equipment, logistic distribution equipment, or
information technology equipment, as to personal property, is reasonable for
projects of that nature or equipment of that type.
2. That the estimate of number of individuals who will be employed or whose
employment will be retained can be reasonably expected to result from the
proposed described redevelopment or rehabilitation, or from the installation of
the new manufacturing equipment, research and development equipment,
logistic distribution equipment, or information technology equipment.
3. That the estimate of annual salaries of those individuals who will be employed
or whose employment will be retained can be reasonably expected to "'result
from the proposed described redevelopment or rehabilitation, or from the
installation of the new manufacturing equipment, research and development
equipment, logistic distribution equipment, or information technology
equipment.
4. That any other benefits about which information was requested are benefits
that can be reasonably expected to result from the proposed redevelopment or
rehabilitation, or from the installation of the new manufacturing equipment,
research and development equipment, logistic distribution equipment, or
information technology equipment.
5. That the totality of the benefits is sufficient to justify the deduction.
6. That installation of the equipment described in the SB-1 must be completed
within 36 months of the date the ordinance is signed by the designating body.
Further, the abatement is limited to the equipment listed in the SB-1.
7. That a prior deduction schedule was passed by Common Council pursuant to
Richmond City Amended ordinance Number 5-2019 and that said deduction
schedule is applicable to the deductions approved along with these findings.
NOW, THEREFORE, the Common Council of the City of Richmond, Indiana, now
makes the following findings:
1. That the estimate of value of the redevelopment or rehabilitation, as to real
property, or the estimate of cost of the new manufacturing equipment,
research and development equipment, logistic distribution equipment, or
information technology equipment, as to personal property, is reasonable for
projects of that nature or equipment of that type.
2. That the estimate of number of individuals who will be employed or whose
employment will be retained can be reasonably expected to result from the
proposed described redevelopment or rehabilitation, or from the installation of
the new manufacturing equipment, research and development equipment,
logistic distribution equipment, or information technology equipment.
3. That the estimate of annual salaries of those individuals who will be employed
or whose employment will be retained can be reasonably expected to result
from the proposed described redevelopment or rehabilitation, or from the
installation of the new manufacturing equipment, research and development
equipment, logistic distribution equipment, or information technology
equipment.
4. That any other benefits about which information was requested are benefits
that can be reasonably expected to result from the proposed redevelopment or
rehabilitation, or from the installation of the new manufacturing equipment,
research and development equipment, logistic distribution equipment, or
information technology equipment.
5. That the totality of the benefits is sufficient to justify the deduction.
6. That installation -of the equipment described in the SB-1 must be completed
within 36 months of the date the ordinance is signed by the designating body.
Further, the abatement is limited to the equipment listed in the SB-1.
7. That a prior deduction schedule was passed by Common Council pursuant to
Richmond City Amended Ordinance Number 5-2019 and that said deduction
schedule is applicable to the deductions approved along with these findings.
NOW THEREFORE, be it ordained by the Common Council of the City of Richmond,
that the following property owner meets the requirements for property tax assessed valuation
deductions, as follows:
MANUFACTURING EQUIPMENT —10 YEARS
Purina Mills, LLC
Current Jobs: 80
Jobs Retained: 80
Jobs Created: 5
Estimated New Value: $ 10,000,000.00
Dated: April 28, 2019
Passed and adopted this day o 2019, by the Common Council of the
City of Richmond, Indiana.
ATTEST:
Chasteen, IAMC, MMC}
President
PRESENTED to the Mayor of the City of Richmond, Indiana, this day 20195
at 9:00 a.m.
/�' Clerk
(Karen Chasteen, IAMC, MNIC)
APPROVED by me, David M. Snow, Mayor of the City of Richmond, Indiana, this 4day of
2019, at
ATTE S
(Karen Chasteen, IAMC, MMC)
Mayor
Form SB-lA
City of Richmond, Indiana
Taxpayer Wage &Benefit Information
Company Name, Address & Contact Person: Purina Animal Nutrition, LLC
Scott Crittenden, Sr. Plant Manager
505 N. 4th and 1700 Industries Dr.
Richmond, IN 47374
The information requested on this supplement to form SB- 1 must be completed and submitted
along with your SB-I in order for your tax abatement request to be considered by Richmond
Common Council. Please retain your records and calculations used to arrive at the information
requested on this form. It is subject to review as a part of our monitoring process.
1. Average hourly wage for existing employees $ 23.56
2. Average hourly wage for projected new positions $ 22.68
3. Average hourly health insurance benefit
$ 5.55
1. The length of the abatement you are requesting 10
(A 1--10 year abatement may be requested for real estate improvements and manufacturing equipment.)
2. If purchasing equipment, please attach a list that includes the following:
• brief description of each piece of equipment being purchased
• the projected useful life of each piece of equipment
• the state(s) in which the equipment is being brought into Indiana from if purchasing used
equipment
• the cost of each piece of equipment
• state if the machinery is being purchased or leased
• if the machinery is being leased, provide information from the lease that explains which
party is responsible for paying the property taxes
3. If making real estate improvements, please provide a list that includes the following:
• brief description of the real estate improvement (new construction, rehab, expansion, etc.)
• size of the proposed real estate improvements
• costs of the proposed real estate improvements
DEFINITIONS
1. Average hourly wage for existing employees: for your most recent pay period please provide the
average base wage per hour for all current full time, non -supervisory employees. Do not include the
following groups:
A. part time employees;
P. management, supervisors, foremen, or any other supervisory personnel;
C. owners, stockholders, or partners if they own 2% or more of the business, and their
family members.
2. Average hourly wage for projected new positions: Use the same definition of employees to be included
as in number one above.
3. Average hourly health insurance benefit: Please provide the current company paid health insurance
benefits provided to hourly employees (as defined above) and family members. Please present in the
form of an hourly ra4e computed using the annual east per eligible employee divided by 2080 hours.
� ---w- Marcia H. Droeg e, Director of Real Estate & Facilities 04/29/2019
(Authorized Signature and Title) (Date)
Attachment Made Part of RICHMOND Form S13-1A
Purina Animal Nutrition, LLC
Purchase
Asset Description
Useful Life
Used?
Lease
Estimated Cost
2019
North Extruder Dryer Install
5--8 yr
New
Purchase
$
1,810,000
South Pellet Dryer
5-8 yr
New
Purchase
$
800,000
Warehouse MCC Replacement
5-8 yr
New
Purchase
$
501000
Finished Product Warehouse Ventilation & Pest Control
5-8 yr
New
Purchase
$
20,000
Pellet Packer Meal Grinder rebuild
5-8 yr
New
Purchase
$
15,000
North Extruder Rebuild parts
5--8 yr
New
Purchase
$
120,000
North Pellet Mill Partial Rebuild
5-8 yr
New
Purchase
$
15,000
Liquids Renovation for Extruder Packer Blenders
5--8 yr
New
Purchase
$
37,500
2019 Total
$
2,867,500
2020
South Pellet Dryer
5-8 yr
New
Purchase
$
1,800,000
Pellet Packer packing Scale Replacement
5-8 yr
New
Purchase
$
3201000
Extruder Packing blending system
5-8 yr
New
Purchase
$
400,000
Pellet Packer Bag Conveyance to Palietizer Replacement
5-8 yr
New
Purchase
$
110,000
South Pellet dryer fan replacement
5-8 yr
New
Purchase
$
85,000
South Pellet grinder install
5-8 yr
New
Purchase
$
5001000
South Pellet downstream capability improvement
5-8 yr
New
Purchase
$
250,000
Extruder Packer Palletizer Rebuild
5-8 yr
New
Purchase
$
17,500
Extrusion Mixed Meal Turnhead & Spouting replacement
5-8 yr
New
Purchase
$
145,000
Acid Hydrolysis attachment for existing Fat & Fiber unit in Q.A. Lab
5-8 yr
New
Purchase
$
6,000
North Pellet Mill Sth Floor Grinder replacement
5-8 yr
New
Purchase
$
60,000
Unloading Conveyance rebuild
5-8 yr
New
Purchase
$
25,000
Steam control valve replacement
5--8 yr
New
Purchase
$
12,000
Grinding Elevator Leg rebuild
5-8 yr
New
Purchase
$
15,000
2020
$
3,7450500
2021
Unloading Turnhead - Softstock
5-8 yr
New
Purchase
$
901000
Unloading Turnhead - Grain
5-8 yr
New
Purchase
$
901000
North Pellet Screener replacement
5-8 yr
New
Purchase
$
120,000
Mixing Bin bottom replacement
5-8 yr
New
Purchase
$
320,000
Fish Oil tank replacement
5-8 yr
New
Purchase
$
120,000
Boiler 02 Trim
5-8 yr
New
Purchase
$
60,000
Boiler RO System
5-8 yr
New
Purchase
$
40,000
North Extruder Conditioner
5-8 yr
New
Purchase
$
65,000
Steam Control Valve Replacement
5-8 yr
New
Purchase
$
12,000
Condensate Mover and Piping
5-8 yr
New
Purchase
$
140,000
Pellet Mill Controls
5-8 yr
New
Purchase
$
300,000
Extruder Process Control
5-8 yr
New
Purchase
$
5001000
Micro micro system for mixing
5-8 yr
New
Purchase
$
4401000
2021 Total $ 21297,000
Variance $ 11090,000
Project Total $ 10,000,000
Attachment Made Part of RICHMOND Farm SB-1A
Purina Animal Nutrition, LLC
Purchase
Asset Description Useful Life Used? Lease Estimated Cost
2019
Extrusion Equipment
5-8 yr
New
Purchase
$
1,967,500
Pellet Equipment
5-8 yr
New
Purchase
$
8300000
Either
5-8 yr
New
Purchase
$
70,000
2019 Total
$
2,8671v500
2020
Extrusion Equipment
-5-8 yr
-New
Purchase
$
562;500
Pellet Equipment
5-8 yr
New
Purchase
$
3,125,000
Other
5-8 yr
New
Purchase
$
58,000
2020 Total
$
3,745,500
2021
Extrusion Equipment
5-8 yr
New
Purchase
$
565,000
Pellet Equipment
5-8 yr
New
Purchase
.$
420,000
Other
5-8 yr
New
Purchase
$
L312,000
2021 Total
$
2,297,000
Variance
$
1,090,000
Project Total
$
10,000,D00
STATEMENT OF BENEFITS
PERSONAL PROPERTY
' } State Form 51764 (R4 / 11-15)
}
+ere►
Prescribed by the Department of Local Government Finance
FORM SB-1 / PP
PRIVACY NOTICE
AInformation concerning the cost
e property and specific salaries paid
to individual employees by the property
owner Is confidential per IC 6-1.1-12.1-5.1.
INSTRUCTIONS
This statement must be submitted to the body designating the Economic Revitalization Area prior to the public hearing if the designating body requires
Information from the applicant In making Its decision about whether to designate an Economic Revitalization Area. Otherwise this statement must be
submitted to the designating body BEFORE a person installs the new manufacturing equipment and/or research and development equipment, and/or
logistical distribution equipment and/or Information technology equipment for which the person wishes to claim a deduction.
2. The statement of benefits form must be submitted to the designating body and the area designated an economic revitalization area before the installation
of quafifying abatable equipment for which the person desires to claim a deduction.
3. To obtain a deduction, a person must file a certified deduction schedule with the person's personal property return on a certified deduction schedule
(Form 103-ERA) with the township assessor of the township where the property Is situated or with the county assessor If there Is no township assessor
for the township. The 103-ERA must be filed between January I and May 15 of the assessment year In which new manufacturing equipment
and/or research and development equipment and/or logistical distribution equipment and/or information technology equipment is installed and rully
functional, unless a filing extension has been obtained. A person who obtains a filing extension must file the form between January I and the extended
due date of that year.
4. Property owners whose Statement of Benefits was approved, must submit Form CF-1IPP annually to show compllance with the Statement of Benefits.
(IC 6-1.1-12.1-5.6)
5. For a Form SB-1IPP that is approved after June 30, 2013, the designating body Is required to establish an abatement schedule for each deduction allowed
For a Fonn SB-1IPP that is approved prior to July 1, 2013, the abatement schedule approved by the designating body remains In effect. (IC 6-1.1-12.1-17)
SECTION• "AYER INFORMATION
Name of taxpayer
Name of contact person
PURINA MILLS LLC
KAREN KARRAS
Address of taxpayer (number and street, city, state, and ZIP code)
Telephone number
PO BOX 64101 MS-5185, ST PAUL, MN 55164
651 ) 375-5654
SECTION 2 LOCATION AND DESCRIPTION OF PROPOSED PROJECT
Name of designating body
Resolution number (s)
CITY OF RICHMOND
Location of property
County
DLGF taxing district number .
505 N 4TH ST
WAYNE
89030
Description of manufacturing equipment and/or research and development equipment
ESTIMATED
and/or logistical distribution equipment and/or Information technology equipment.
(Use additional sheets if necessary.)
START DATE
COMPLETION DATE
Manufacturing Equipment
07/0112019
12/31/2021
VARIOUS UPGRADES TO PLANT INCLUDING EQUIPMENT FOR
GRINDING, EXTRUSION, PELLETING, BULK LIQUID INGREDIENT
STORAGE AND WAREHOUSING
R & D Equipment
Logist Dist Equipment
IT Equipment
SECTION 3 ESTIMATE OF EMPLOYEES AND SALARIES AS RESULT OF PROPOSED PROJECT
Current number Salaries Number retained Salaries Number additional Salaries
80 $49K annual avg 80 $49K annual avg 5 $47K annual avg
SECTION 4 ESTIMATED TOTAL COST AND VALUE OF PROPOSED PROJECT
NOTE: Pursuant to 1C 6-1.1-12.1-5.1 (d) (2) the MANUFACTURING R & D EQUIPMENT LOGIST DIST IT EQUIPMENT
E UIPMENT EQUIPMENT
COST of the property is confidential. COST ASSESSED COST ASSESSED COST ASSESSED COST ASSESSED
VALUE VALUE VALUE VALUE
Current values
32,692, 854
9, 807, 856
Plus estimated values of proposed project
10,000,000
41000,000
Less values of any property being replaced
11400,000
200,000
Net estimated values upon completion of project 41,2929854 13,607,856
SECTION WASTE • ! ! OTHER BENEFITS
PROMISED BY THE TAXPAYER
Estimated solid waste converted (pounds)
Estimated hazardous waste converted (pounds)
Other benefits:
SECTION., _ CERTIFICATION
I hereby certify that the repr eptations In this statement are true.
Signatu e,of uthorixed repre a
�
der
Date signed (month, day, year) 04/28/2019
Printed name of authorized reprAer(tafive
Title
Marcia H. Droege
Director of Real Estate & Facilities
Page I of 2
FOR USE OF THE DESIGNATING BODY
We have reviewed our prior actions relating to the designation of this economic revitalization area and find that the applicant meets the general standards
adopted in the resolution previously approved by this body, Said resolution, passed under IC 6-1.1-12.1-2.5, provides for the following limitations as
authorized under 1C 6-1.1-12.1-2.
A. The designated area has been limited to a period of time not to exceed calendar years * (see below). The date this designation expires
is . NOTE. This question addresses whether the resolution contains an expiration date for the designated area.
B . The type of deduction that is allowed in the designated area is limited to:
1 . Installation of new manufacturing equipment; ❑ Yes C7 No ❑ Enhanced Abatement per IC 6-1.1-12.1-18
2 . Installation of new research and development equipment; ❑ Yes ❑ No Check box if an enhanced abatement was
3. installation of new logistical distribution equipment. ❑ Yes ❑ No approved for one or more of these Types.
4. Installation of new information technology equipment; ❑ Yes ❑ No
C. The amount of deduction applicable to new manufacturing equipment is limited to cost with an assessed value of
$ . (One or both lines may be filled out to establish a limit, if desired.)
D . The amount of deduction applicable to new research and development equipment is limited to $ cost with an assessed value of
$ . (One or both lines maybe filled out to establish a limit, if desired.)
E . The amount of deduction applicable to new logistical distribution equipment Is limited to $ cost with an assessed value of
$ . (One orboth lines may be filled out to establish a limit, if desired.)
F. The amount of deduction applicable to new information technology equipment is limited to $ cost with an assessed value of
$ . (One orboth lines may be filled out to establish a limit, if desired.)
G. Other limitations or conditions (specify]
H. The deduction for new manufacturing equipment and/or new research and development equipment andlor new logistical distribution equipment andlor
new information technology equipment Installed and first claimed eligible for deduction Is allowed for:
❑ Year 1 ❑ Year 2 ❑ Year 3 ❑ Year 4 ❑ Year 5 ❑ Enhanced Abatement per 1C 6-1.1-12.1-18
Number of years approved:
❑ Year 6 ❑ Year 7 ❑ Year 8 ❑ Year 9 ❑ Year 10 (Enter one to twenty (1-20) years; may not
exceed twenty (20) years.)
1. For a Statement of Benefits approved after June 30, 2013, did this designating body adopt an abatement schedule per IC 6-1.1-12.1-17? ❑ Yes ❑ No
If yes, attach a copy of the abatement schedule to this form.
If no, the designating body Is required to establish an abatement schedule before the deduction can be determined.
AIso we have reviewed the information contained in the statement of benefits and find that the estimates and expectations are reasonable and have
determined that the totality of benefits Is sufficient to justify the deduction described above.
Approved by: (signature and We of authorized member of designafrng body)
Telephone number
Date signed (month, day, year)
Printed name of authorized member of designating body
Name of designating body
Attested by: (signature and Title of attester)
Printed name of attester
* if the designating body limits the time period during which an area is an economic revitalization area, that limitation does not limit the length of time a
taxpayer is entitled to receive a deduction to a number of years that Is less than the number of years designated under IC 6-1.1-12.1-17.
1C 5-1.1-12.1-17
Abatement schedules
Sec.17. (a) A designating body may provide to a business that Is established in or relocated to a revitalization area and that receives a deduction under section 4 or 4.5
of this chapter an abatement schedule based on the following factors:
(1) The total amount of the taxpayer's investment In real and personal property.
(2) The number of new full-time equivalent jobs created.
(3) The average wage of the new employees compared to the state minimum wage.
(4) The Infrastructure requirements for the taxpayer's Investment.
(b) This subsection applies to a statement of benefits approved after June 30, 2013. A designating body shall establish an abatement schedule for each deduction
allowed under this chapter. An abatement schedule must specify the percentage amount of the deduction for each year of the deduction. An abatement schedule may
not exceed ten (10) years.
(c) An abatement schedule approved for a particular taxpayer before .July 1, 2013, remains in effect until the abatement schedule expires under the terms of the
resolution approving the taxpayer's statement of benefits.
Page 2 of 2
FORM SB - t IPP
AMENDMENT TO ORDINANCE NO.24-20'19
STATEMENT of BENEFITS
PERSONAL PROPERTY
Purina Animal Nutrition, LLC operates two locations within the City limits of Richmond, Indiana: 1 700
Industries Road, and the subject property, 505 North 4t' Street. The requested deduction for personal
property will induce Purina Animal Nutrition to retain 80 and create 5 net new jobs between the two
locations.
All employees at the operations of Purina Animal Nutrition, LLC are employees of its parent, Land O'Lakes,
Inc. and are provided under a service agreement between the two.
The request for personal property tax deduction is specific to personal property proposed to be placed into
service at the 505 North 4t' Street location. The property talc owner of record for this location is Purina
Mills, LLC, a wholly owned company of Purina Animal Nutrition, LLC.