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Wednesday, May 4, 2016

City Council approves tax abatement

Wednesday, July 9, 2008

The Greencastle City Council approved $27,000 in tax abatements for Chiyoda USA at their Tuesday-night meeting.

The unanimous vote means a seven-year abatement on approximately $660,000 worth of new equipment that the company plans to install over the next year.

Bringing the company's request to the council, Bill Dory said Chiyoda is hoping to attract more customers and thereby expand its Greencastle facility by adding three new molding machines.

One of the machines, a blow molding machine, is an up and coming form of molding in the auto industry, Dory said, and Chiyoda officials are hoping to capitalize on the market to ensure future growth of the Greencastle plant.

Council members expressed their support for the abatement, saying they hoped it would bring new jobs to the city. They voted 5-0 to approve the resolution.

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Not sure I understand the further use of funds(loss of funds,whatever) to assist this company in furthering their profits.Whats next,Wendy's needing a new grill? These companies in Greencastle,pay employees low wages and profit hugely in sales. Not sure these low paying jobs are worth being held hostage for free updating of equipment to add to their profits.Maybe I'm missing something....

-- Posted by honestyisbestpolicy on Wed, Jul 9, 2008, at 7:32 AM

The tax abatements apply only to the new equipment, not to the entire facility. The tax abatements encourage growth of existing facilities, which in turn leads to new jobs, or in the case of a weak economy, prevents job loss. Growth of an existing facility takes far less effort from local economic development personnel than landing a new business, so the return on investment is quite favorable.

-- Posted by VolunteerFF on Wed, Jul 9, 2008, at 8:58 AM

If there was no abatement, there would be no expansion and therefore no new jobs. So the $27,000 would not be there either way. Plus we would not get the portion of taxes created by the new jobs. This abatement creates tax revenue, it doesn't lose any.

-- Posted by VolunteerFF on Wed, Jul 9, 2008, at 11:55 AM

Also, as I understand tax abatements, it is phased out over the life of the abatement. So taxes will go up each year until they are fully funded.

-- Posted by hoosierpete on Wed, Jul 9, 2008, at 3:08 PM

Oh Man - why in the world is Greencastle Leaders letting another place have a tax abatement with the economy the way it is?!

IN 7 years, Chiyoda will probably do the same as Happico did - file Bankruptsy and leave without paying. I used to work there 1 person can run a machine - so whoo hoo, we created 5 JOBS? come on! They pay through PMI also, so they get hired on @ $7.50/hour? who can live on that?

Greencastle Leaders, you need to start HELPING us not Hurting us!

-- Posted by luv2bmom2001 on Wed, Jul 9, 2008, at 11:18 PM

Previous post says "Greencastle Leaders, you need to start HELPING us not Hurting us!"

How is this hurting us? Creating even a few new jobs is not hurting us. Having a business environment that discourages growth would hurt us. Having a business environment that encourages growth helps us. Tax abatement costs us nothing, but earns us more tax revenue from payroll taxes and more property tax in the long term. Denying them an abatement might just cause them to go somewhere else. How many jobs would that cost us? All of them!

-- Posted by VolunteerFF on Thu, Jul 10, 2008, at 4:53 AM

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