Vigo County Council gives nod to Steel Dynamics tax break for $231 million expansion: Preliminary vote goes 7-0; final vote still to come

“Another question we had … is do you anticipate challenges with hiring 80 to 85 people. We were very up front and said yes we do, but when we went back and said this is not our first new expansion or new plant. How do you handle mass hires, especially in this environment? We noted we normally have job fairs, and job applications days, which have had tremendous success,” Klutz said.


Prior to the consideration of Steel Dynamics, the issue of hiring workers was discussed under a review of tax abatements for compliance with Thyssenkrup Presta North and Taghleef Industries. Each company said they have been seeking to hire new workers, unsuccessfully, for the past two years.

Andy Volkl, chief operating officer and general manager of Thyssenkrupp Presta North America, said the company has 42 open positions, with starting wages of $14.91 per hour and $16.53 per hour, depending on position. “We are struggling to find employees,” Volkl said.

Thyssenkrup, Volkl said, was forced to move its product and development section, comprised largely of engineers, to Carmel and Indianapolis to attract engineers. That move resulted in 15 workers moving from Vigo County. The product development section now has 88 workers in Carmel, Volkl told the council.

Lawrence Mauer, director of operations at Taghleef Industries Inc., said the company has 20 positions not filled it the past two years. Mauer said “it is difficult to attract” workers to its 24/7 manufacturing facility.

“We have a lot of industry in the area and we are all fighting over the same people, and everybody keeps bumping wages to try to bring them in and it is a non-ending cycle,” Mauer said. “We certainly participant in hiring events. One of the telling

ones was a few weeks ago. We participated in an event, and I think there were 20 companies there, and there were like four people who walked through,” Mauer said.

Klutz said Steel Dynamics thinks “the $80,000 wage will be an attraction” for the company to attract 84 new employees.

Councilwoman Vicki Weger noted the company is planning to invest nearly “a quarter of a billion dollars on this project. This fills a spot [created] by Columbia Records leaving, by Sony records leaving. This is what grows a community, and this where kids can stay in the community when they graduate because they have an $80,000 job to go to,” Weger said.

The cold-roll steel plant proposes constructing a 390,000-square-foot expansion of its facility in the Vigo County Industrial Park at a cost of $34.65 million and installing $196.35 million in new equipment.

Tax abatements are usually phased in over a specified period, with companies paying more each year in a sliding scale abatement. In this request, 100 percent of equipment and building taxes are abated for the 10 years involved.

That abatement would save the company about $25.4 million over 10 years, with about $16.9 million in taxes on new equipment and $8.5 million in taxes on its proposed new building.

Councilman Todd Thacker said the council needs to establish requirements for future full abatement requests.

“I think you are a great example of the bar to be held,” he said to Steel Dynamics. “It is a huge project with good paying jobs. I ask that we collectively put together some criteria to demonstrate our decision, whatever it is, and we follow it going forward,” he said.

Councilman Aaron Loudermilk questioned if the company has received other full tax abatements in other states. Matthew Peters, vice president of tax and benefits for Steel Dynamics, said the company has had other such abatements, but they vary state to state, with other full abatements in the range of seven years.

Councilman Travis Norris said the council heard from two other companies that could not reach employment goals.

“My concern is that once this abatement passes and starts, we are back here next year and every year after. … and you unable to fill the positions and get to the numbers promised up front,” Norris said.

Klutz said the “negative of that is the positive, that you have the power every year to assess this and hold us accountable. This is not something that we are asking for this and see you in 10 years. This is we will back every year if there is a problem. If we don’t have a plausible reason” for not reaching its employment goals, the council can rescind the abatement, Klutz told the council.

The council will vote on a final adoption of the tax abatement at its September meeting.