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City Council deals with four abatement issues
While dealing with tax abatement has become a rather routine part of the employment and economic landscape for the Greencastle City Council, the March Council meeting took the issue to new heights.
The Council dealt with four tax abatement issues, including two history-making residential tax abatements, a more traditional abatement on new equipment for Heartland Automotive and a transfer of an old abatement for Ascena Retail Group to its new ownership.
By unanimous vote, the Council passed Ordinances 2023-1 and 2023-2 on first reading for creation of an Economic Development Target Area on two residential projects:
-- Woodshire Place, a 39-unit development in 13 triplex buildings on 3.05 acres off Woodhaven Drive, east of U.S. 231 and adjacent to Southwood Village on the city’s south side. DSD Real Estate Holdings, represented by Adam D’Angelo, purchased the property from John Wood and received Zoning Board approval for development standard variances on the property last May.
-- Indian Springs North Apartments, a 25-unit complex at North Arlington Street and Houck Road, purchased by Global Construction Management and Jared Grable from the Greencastle Housing Authority scheduled to be returned to the tax rolls after 40 years.
Both residential projects were endorsed by the Greencastle Economic Commission at its Feb. 22 meeting and forwarded to the Council for approval.
Noting a “desperate need” for additional housing, Councilman Dave Murray made the motion to approve first reading of the Woodshire Place-related ordinance, noting that a precedent was being set in allowing tax abatement on residential projects.
“I just want to say we’re setting a precedent,” he warned, adding that the move is opening the door for “any developer to be in here wanting tax abatement.”
Noting the $10,000 difference in the projected salaries for renters in Woodshire Place and Indian Springs North, Murray asked developer Grable to compare them.
“It’s the square footage,” Grable said, noting that two-bedroom unit at Indian Springs will be 850-900 square feet, while D’Angelo earlier had said the units at Woodshire Place will be 1,500 square feet.
Earlier a question was asked about the two projects during the Woodshire Place discussion and Grable said from the audience, “I can answer that,” proceeding to characterize the Woodshire development as an “A property,” while noting Indiana Springs is presently a “D property,” which he hopes to bring up to a B or B-plus with the renovation.
Greencastle/Putnam County Economic Development Director Kristin Clary simplified it further. Woodshire, she said, “is a brand new building,” while Indian Springs is “a rehabbing property.”
“We need more housing at every price point,” Councilor Veronica Pejril interjected, echoing comments Clary had made in previous discussions.
“We’re taking a unique approach to tax abatement,” Councilman Cody Eckert allowed. “It goes to show we’re pulling out all the stops to bring new housing to Greencastle.”
Eckert made the motion to approve the Grable request on first reading.
Second and final readings on the two residential project ordinances is expected at the April Council session, which has been moved back a week to Thursday, April 20, 7 p.m. at City Hall.
Meanwhile, in approving Resolution 2023-2 authorizing tax abatement for the Heartland Automotive property on Warren Drive, the Greencastle City Council allowed the East Side auto parts manufacturer the flexibility to create a new product line. A longtime supplier for the Subaru Automotive USA plant at Lafayette, Heartland will be changing over one of its passenger car lines to create parts for the Subaru Crosstrek, an all-wheel-vehicle.
“They’re not adding jobs, they’re retaining and retraining,” Clary said of Heartland’s current roster of 333 employees and $13.7 million in salaries.
The Heartland project will all be done within the current factory footprint. The project cost is estimated at $4,066,000.
During the public hearing on the abatement, Councilman Murray noted that Heartland’s community involvement, highlighted by a $100,000 donation for the city’s tennis and pickleball courts, is “a significant donation” and an example for all local industries.
The final abatement-related matter involved Ascena, whose new owner, Premium Brands Services LLC, completed a sale-leaseback on its real estate at 1901 E. State Road 240 East in December.
Premium Brands, according to a letter to Mayor Bill Dory from corporate tax vice president Monica Kilgren, will continue to be responsible for the real estate taxes and operate the e-commerce fulfillment center in the old IBM building in Greencastle.
“Day-to-day operations will not change as a result of the sale-leaseback,” the letter notes. “Additionally, it is important to note that the personal property was not included in this transaction.”
The letter goes on to note that the City Council granted Ascena a 10-year tax abatement term on Nov. 24, 2015. With remodeling of the fulfillment center completed in 2016, tax abatement commenced in tax year 2017/pay 2018 and then will expire in tax year 2026/pay 2027.
Premium Brands will continue to realize the abatement for the remainder of the 10-year term, subject to ongoing annual compliance.
In asking for the formal action to transfer the property and eligible tax abatement, Mayor Dory noted that Premium Brands has “agreed to the employee and investment goals originally established.”
On a motion by Councilman Darrel Thomas, the Ascena/Premium Brands letter was entered into the minutes.
Council members Murray, Thomas, Eckert and Pejril were joined for the March meeting by Stacie Langdon and new member Russell Harvey, who was sworn just prior to the meeting to succeed Adam Cohen, who resigned as First Ward councilman due to health issues. Council President Mark Hammer was absent.