An Edinburgh automotive components supplier will receive a tax break for a nearly $2 million equipment expansion.
The Edinburgh Town Council unanimously approved a five-year personal property tax abatement Aug. 25 for Ditech Inc. at 1000 S. Main St., Edinburgh. Council president Ryan Piercefield was not in attendance.
Ditech has been in business for over 31 years in central Indiana, manufacturing and specializing in tubular products and exhaust components for motor vehicles, according to its website.
In an approximately $2 million investment, Ditech is planning on adding new manufacturing equipment to its building, like a laser, compressor dryer, washer, bending and endforming cell, and welding equipment, to help produce tubular products and exhaust components, according to the tax abatement application.
The company also plans to add six employees with an expected average salary of $22 per hour. The plant will retain its current 163 employees, the application says.
The five-year tax break will be phased, with 100% of taxes abated in the first year before dropping to 60% in year five. Subsequent years will have no taxes abated for this project, town documents show.
At the council meeting, Ditech owner Nate Dillingham asked why the company wasn’t given a 10-year tax abatement like previous abatements the company has received council approval for.
From 2008 to 2012, the company received three five-year personal property tax abatements. In 2014 and 2016, the manufacturer received two 10-year personal property abatements. Ditech’s first abatement was issued in 2005.
More recently, Ditech received a 10-year real property tax abatement in 2024 for a $900,000 investment to construct a third building at 1151 S. Walnut St. In 2023, the company invested $3 million to upgrade equipment. Abatements issued in 2023 and 2016 were still active as of the summer of 2024.
This time, however, the council opted to approve a five-year personal property abatement since they “may be a thing of the past in 2028 and beyond” with changes from the state legislature, said Julie Young, Edinburgh’s planning director.
“The legislature has passed several changes to the personal property tax and so the largest changes are scheduled to take effect in 2028,” Young said. “… So passing property tax abatements like personal property may be something that the town council doesn’t consider.”
A five-year tax abatement “bridges the gap” until the new changes come about, Young added.
Attorney Dustin Huddleston added that he hasn’t seen a 10-year personal property tax abatement for a $2 million investment and Young said the five-year personal property abatement is common in other communities.
Dillingham disagreed, advocating for a higher abatement.
“This was a pretty significant investment,” Dillingham said. “I mean, it’s over $2 million.”
Huddleston and council member Miriam Rooks and Huddleston mentioned that Ditech’s lawyer signed off on the five-year tax abatement.
Rooks asked Dillingham if he wanted the council to table the vote, but he asked the council to approve the five-year abatement, despite his initial questioning.