Lebanon Business Park adding Ken's Foods, nearly 150 jobs

Massachusetts-based Ken's Foods — producer of dressings, sauces and marinades — will build a nearly 320,000 square-foot facility in the newly opened CSX Direct Select Site portion of the Lebanon Business Park. The company will purchase a 40-acre parcel of the available 250 acres in the CSX Direct Select Site, that offers rail service.

The unanimous passing of the Economic Revitalization Area resolution following a second reading and opportunity for public comment at Monday’s city council meeting cleared the way for the project.

Boone County Economic Development Corp. Director Molly Whitehead said the company began looking for a location to place another manufacturing and distribution facility as its other three operations in Massachusetts, Georgia and Nevada were at capacity.

The Boone EDC requested the ERA designation so that it can offer that incentive to any possible company, pending individual approval from the council. A site must be designated an ERA to be eligible for tax abatements.

“We at the Boone EDC and the mayor have been working for the past six months with this company to show them the advantages of locating in the Lebanon Business Park,” Whitehead said. “The CSX Select Site played a very large part of why they chose to locate in Lebanon.”

Slated to begin operating by the end of 2017, the company will offer nearly 150 jobs to the area. The facility is expected to produce nearly 150 to 200 million pounds of products each year for Midwest consumers.

“These are well-above wages for Boone County, well-above $20 an hour … the company provides benefits to its employees,” Whitehead said.

"This is a big, big win for the city with 150 jobs, with very, very good wages, and we're excited for the city," Lebanon councilman Corey Kutz said.

With a real property investment of approximately $35 million and personal property investment of $51 million, Whitehead said “to put this in perspective, all the other announcements we’ve had here to date in Boone County this one far surpasses all of those combined, and represents a very good deal for the city of Lebanon.”

According to the Economic Policy Institute, a 2013 study showed Indiana as the leader in the upper Midwest with 16.8 percent of its jobs credited to manufacturing. Indiana ranked seventh out of all states with 491,900 jobs in the same 2013 report.

Chief Operating Officer of Ken’s Foods Bob Merchant said in a press release numbers like those influenced the company’s decision to come to Indiana.

“While undergoing our site selection diligence, we found that Indiana has a very strong manufacturing base with a unique combination of advanced manufacturing as well as educated, knowledgeable workers,” he said. “Manufacturing now makes up over 30 percent of the state’s economic output, compared to 12 percent overall of U.S. GDP. Indiana has undergone major regulatory and tax structure changes over the last 10 years that has allowed it to maintain and grow its strong manufacturing base. This has really given the state significant competitive advantages over other surrounding states.”

Locally, those advantages include a 100 percent tax abatement for Ken’s Foods for its first three years and a 50 percent abatement in its fourth year. Full property taxes will take effect in its fifth year.

Whitehead said the anticipated tax levy after that period would total approximately $4.8 million with personal property levy of approximately $2.1 million in a 10-year period.

“For the City of Lebanon, this would be a much better deal for you,” she said while talking to the city council. “Though you may not capture those property tax revenues in the beginning, you will receive much more money over a 10-year period of time than you might have under a traditional abatement model.”

Under the traditional 10-year abatement model, Whitehead said the city would have brought in an estimated $5.3 million. Utilizing the model approved by the council with a real property incentive and 2016-17 personal property incentive, specifically set for Ken’s Foods, the city stands gain $7 million over the same 10-year period.

“Basically the city exchanged a quicker short-term benefit for a bigger long-term benefit,” Whitehead said. “We look at each deal on a case by case basis.”

The company’s philanthropic efforts made Whitehead’s list of other community benefits the company offers. Ken’s Foods supports local law enforcement and fire departments, youth organizations, clothing and food drives, veteran support groups Whitehead said and “we anticipate they would do the same here in Lebanon.”