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HomeMy Public PortalAbout005-2004 - Tax Abatement - Howa Textile Industry Co., .pdf.w.exORDINANCE NO.5-2004 A SPECIAL ORDINANCE PR OPERTY OWN R APPL,�G FOR DEDUCTIONS UNDERPPROVAL OF A STATEMENT OC• BENEFITS FOR A PROPER 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 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, 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 value, pursuant India a law, for a period of any number of years ng equipment is also entitled to deductions from assessed value, p 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, 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. 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. 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. 5. That the totality of the benefits is sufficient to justify the deduction. NOW, THEREFORE, be it ordained by the Common Council of the City of Richmond, Indiana, that the following property owner meets the requirements for property tax assessed valuation deductions, including the above findings, as follows: EQUIPMENT - 10 YEARS Howa Textile Industry Co., Ltd. New Jobs: 50 Jobs Retained: NIA Estimated New Value: $ 4,000,000.00 Dated: January 8, 2004 Passed and adopted this pday o of Richmond, Indiana. ATTEST: i Clerk 2004 by the Common Council of the City (Karen Chasteen) PRESENTED to the Mayor of the City of Richmond, Indiana, thi day of , 2004 at 9:00 a.m. Cl�lerk (Karen Chasteen) APPROV D by me, Sarah L. Hutton, Mayor of the City of Richmond, Indiana, this of 2004 at 9:05 a.m. 7 Mayor (Sarah L. Hutton) ATTE City Clerk (Karen Chasteen) STATEMENT OF BENEFITS State Form 27167 (R7112-01) fa Prescribed by the Department of Local Govemment Finance I _V`G[� I✓ORllit SB-�I INSTRUCTIONS: I. This statement must be submitted to the body designating the economic revitilization area prior to the public hearing if the designating body requires infor- mation 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 I or research and development equipment, or BEFORE the redevelopment or rehabilitation of real property for which the person wishes to claim a deduction. 'Projects" planned or committed to after July 1, 1987 and areas designated after July 1, 1987 require a STATEMENT OF BENEFITS- (IC 6-1.1-12.1) 2. Approval of the designating body (City Council, Town Board, County Council, etc.) must be obtained prior to initiation of the redevelopment or rehabilitation, or prior to installation of the new manufacturing equipment and I or research and development equipment, BEFORE a deduction may be approved. 3. To obtain a deduction, Form 322 ERA, Real Estate Improvements and 1 or Form 322 ERA I PPME and I or 322 ERA 1 PPR & DE, must be filed with the county auditor. With respect to real property, Form 322 ERA must be filed by the later of. (1) May 10; or (2) thirty (30) days after a notice of increase in real property assessment is received from the township assessor. Form 322 ERA I PPME and I or 322 ERA PPR & DE must be filed between March 1 and May 15 of the assessment year in which new manufacturing equipment and 1. or research and development equipment becomes assessable, unless a filing extension has been obtained. A person who obtains a filing extension must file the form between March 1 and the extended due date of that year. 4_ Property owners whose Statement of Benefits was approved after June 30, 1991 must submit Form CF - 1 annually to show compliance with the Statement of Benefits- (IC 6-1.1-12.1-5.6) 5. The schedules established under IC 6-1.1-12.14(d) and IC 6-1.1-12.1-4.5 (e) effective July 1, 2000 apply to any statement of benefits filed on or after July 1, 2000. The schedules effective prior to July 1, 2000 shall continue to apply to those statement of benefits filed before July 1, 2000- Name of taxpayer Howa Textile Industry Co., Ltd. Address of taxpayer (street and number, city, state and ZIP code) 2-10-4 Ajiyoshi Hakusan-Cho, Kasugai-city, Aichi-pref., 486-096g, JAPAN Name of contact person Shin Iwate Name of designating body Location of property County 1767 Sheridan Street, Richmond, Indiana Way Description of real property improvements and I or new manufacturing equipment and I or research and development equipment (use additional sheets if necessary) The applicant intends to establish an operation for the production of automotive parts to be incorporated into sunroofs of automobiles. The applicant intends to lease space at the above designated location. The applicant would equip its facility with various presses, water jet systems, compressors, roll coaters, and related equipment. Current number Salaries Number retained Salaries 0 1 $0.00 a 1 $0.00 Telephone number (011-81) 568-348397 Resolution number Taxing district ESTIMATED Start Data I Completion Date Real Estate New Mfg Equipment 0310112 R&DE 9 • " 0 M • • Number additional 11/30/2005 Salaries NOTE: Pursuant to IC 6-1.1-12.1-5.1 (d) (2) the Real Estate improvements Machinery Research and Development COST of the property is confidential. Equipment Cost Assessed Value Cost Assessed Value Cost Assessed Valu Current values $4,000,fl00 $1,600,000 Plus estimated values of proposed project 00 00 to Less values of any property being replaced $6,000.000 $2400 000 Net estimated values upon completion of project o r •o Estimated solid waste converted (pounds) _7/a-- _ Estimated hazardous waste converted (pounds) Other benefits: I hereby certify that the representations in this statement are true. of authorized representative Title General Manager -Planning Date signed (month, day, year) 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, pro- vides for the following limitations as authorized under IC 6-1.1-12.1-2. A. The designated area has been limited to a period of time not to exceed designation expires is_— B . The type of deduction that is allowed in the designated area is limited to: 1 . Redevelopment or rehabilitation of real estate improvements; 2. Installation of new manufacturing equipment; 3 _ Installation of new research and development equipment; 4. Residentially distressed areas calendar years * (see below). The date this ❑ Yes ❑ N o ❑ Yes ❑ N o - ❑ Yes ❑ N o ❑ Yes ❑ N o C .The amount of deduction applicable for redevelopment or rehabilitation is limited to $ value of $ __--------- D .The amount of deduction applicable to new manufacturing equipment is limited to $ value of $ --------- -------_. cost with an assessed cost with an assessed E. The amount of deduction applicable to new research and development equipment is limited to $ _--------------- cost with an assessed value of $ ------ F. Other limitations or conditions (specify) —__—__------ Also we have reviewed the information contained in the statement of benefits and find that the estimates and expectations are reason- able and have determa#_tbe totallty of benefits is sufficient to justify the deduction described above. Approved: (signafu an !e o authorized membe Telephone number Date signed (month, day, year) (6s) 7a 3A Atte to v: N/ Designated body * If the designating body limits the time period during which an area is an economic revitiization area, it does not limit the length of time a taxpayer is entitled to receive a deduction to a number of years designated under IC 6-1.1-12.1-4 or 4.5 Form SB-1 A City of Richmond, Indiana Taxpayer Wage & Benefit Information Company Name, Address & Contact person Mr. Shin Iwata HOWA TEXTILE INDUSTRY CO., LTD. 2-10-4'Ajiyoshi Hakusan - Cho Kasugai - City, Aichi - pref, 486-0969 JAPAN must information requested on this supplement to form SB-1 ust be completed and submitted along vvif your SB-1 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 0 2. Average hou ly wage for projected new positions $ - 16.34* 3. Average hourly health insurance benefit S .85* I. The length 'of the abatement you are requesting 10 (A 1-40 year abatement may be requested for real estate improvements and manufachtring 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 3. If malting real estate improvements, please provide a list that includes the following: brief description of the real estate improvement (new constriction, rehab, expansion, etc.) size of the proposed real estate improvements * costs of the proposed real estate improvements nEFOUIONS I. Average hourly wage for existing employees: for your most recent pay period please provide the average base wage per hour for all current fail time, non: supervisory employees. Do not include the following groups: A. part time employees; B. management, supervisors, foremen, or any other supervisory persormel; 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 crtrrent company paid health insurance benefits provided to hourly employees (as defined above) and family members. Please present is the form of an hourly rate computed usimg the annual cost per eligible employee divided by 2080 hours. (Authorized Signature—amTi *These figures do not include approximately nature whose avers h fifteen projected employees of a supervisory/managerial ge ourly wages are projected to he $35.12 and whose average hourly health insurance benefits are projected to be: $1.83. ia.ef1��pmnt `ec�at Substrate Loader © Tahines' 4 $29, 545 Tad t $118, 182 - u]3mt 12 Roll Coater 4 $68, 545 $274, 182 12 Adhesive Spray 4 $53, 891 $215, 564 12 Cover Stock Loader 4 $227,273 $909,091 12 Compression Press 4 $295, 455 $1, 181,818 12 Water Jet System 4 $378, 182 $1, 512, 727 12 Compressor 4 $23, 636 $94, 545 5 Work Table 4 $15, 364 $61, 455 5 Electric & Air supply 4 $63, 636 $254, 545 5 Cooling Tower 4 $29,545 $118,182 12 Tool Heater Tools & jigs 4 1 $29, 545 $27 273 $118, 182 $27,273 12 3 Machining Center 1 $3 636 $3 636 12 Magnetic Machining Center 1 $4, 545 $4, 545 12 Welder 1 $5 455 $5,455 12 Reels for electric supply. 1 $5, 455 $5, 455 3 Contour Machine 1 $10 909 $10 909 12 Cutter 1 $10, 455 $10, 455 12 Hi -Speed Cutter 1 $1,818 $1 818 5 Thermal Cycle Oven 1 $47, 273 $47, 273 5 Textron Tester 1 $23, 636 '$23, 636 5 Folk Lift 4.6 Tons 1 $40, 909 WAN 6 Folk Lift 2.0 Tons 1 $20 455 $20,465 6 Office Equipments 1 $90, 909 $90, 909 5 Total $5, 161 200 1NDS01 640116 BARNES &THORNBURG Christopher P. Felts (317) 231.7731 Email: cfelts®btlaw.com Mr. Tony Foster Business Development Coordinator City of Richmond 50 N. 5th Street Richmond, IN 47374 RE: Howa Textile Industry Co., Ltd. Dear Mr. Foster: I 1 South Meridian Street Indianapolis, Indiana 46204.3535 U.S.A. (317) 236-1313 Fax (317) 231-7433 www.bulaw.com January 9, 2004 I am pleased to enclose with this letter materials relating to the application for a ten year tax abatement with respect to the potential purchase and installation of new manufacturing equipment of our client, Howa Textile Industry Co., Ltd. I also enclose an "informational statement" from Howa which provides some contextual background on Howa's proposed project. You will note that named taxpayer on Form SB-I is Howa Textile Industry Co., Ltd., a Japanese legal entity. It is quite likely that, if the proposed project proceeds, Howa Textile Industry Co., Ltd. would form a wholly -owned subsidiary corporation to be called Howa USA, Inc. (or something similar), which entity would be incorporated in Indiana or another U.S. state and would be the taxpayer under the project. Many thanks for your assistance in this matter. I encourage you to contact me at any point if I can provide additional information. Sincerely C stopher P. Felts CPF:clt Enclosures cc: Shin Iwata Josh Sugimoto IND501 CPF 640285v1 Indianapolis Fort Wayne South Bend Flkhart Chicago Washington, D.C. INFORMATIONAL STATEMENT OF HOWA TEXTILE INDUSTRY CO., LTD. RELATED TO POTENTIAL RICHMOND INVESTMENT Howa Textile Industry Co., Ltd., a Japanese company based in Ai.chi Prefecture, intends to establish a manufacturing presence in the Midwest of the United States for the production of sunshade trim boards for sale to sunroof system suppliers for use in the automotive industry. Howa is considering locating such a facility within the existing Sanyo Laser Products facility in Richmond, Indiana. If Howa proceeds with such an expansion, it is anticipated that the new facility would employ approximately 50 workers by 2007 at an estimated hourly average wage of approximately $22.00 (before fringe benefits). Howa would equip its new facility with approximately $4-$6 million in new manufacturing equipment. "Howa is very excited about the prospect of establishing its first presence in the United States in an area with great proximity to U.S. and Japanese automotive companies. We have been very impressed by the City of Richmond and the State of Indiana and are hopeful that our expansion might occur in Richmond," said Mr. Shin lwata, Howa's General Manager for Corporate Planning. Howa Textile Industry Co., Ltd. was formed in 1955 and is engaged in the production and sales of automotive interior parts. Howa employs 730 workers at its 6 facilities throughout Japan. For additional information, please contact Josh Sugimoto of Howa Japan at 01181-52-761-0862 or josh su imoto mbfni .corn WDS01 CPF 640119v1