GOSHEN — A steel fabrication company looking to construct a new facility in Elkhart County got the thumbs down from Elkhart County Council members during their meeting early Saturday morning.
During the meeting, council members were asked to consider passage of a declaratory resolution for Steel Harbor LLC, a start-up stainless steel fabrication company, supporting a three-year tax phase-in agreement that could bring 28 new full-time jobs to the area.
A tax phase-in is a partial or temporary exemption of a company from having to pay property taxes with the express purpose of stimulating economic development. According to Chris Stager, president of the Economic Development Corporation of Elkhart County, the company — which provides machining and fabrication services to the architectural, automotive, furniture, RV and marine industries — is interested in constructing a new steel fabrication facility just north of the toll road on the county’s north side.
“Steel Harbor would like to construct a 55,000-square-foot building at 22412 Innovation Drive in Area B of the Elkhart East subdivision,” Stager told the council. “They plan on investing approximately $4 million in constructing a new manufacturing facility, with an additional investment of $2.1 million in the high tech manufacturing and IT equipment.”
Of the 28 people the company planned on hiring as part of the project, average wage was proposed at $20 per hour.
“We’re very excited about the opportunity for a new business, a new building inside the county, as well as new jobs,” added Ben Worrell, a site selector with Indianapolis-based McGuire Sponsel, who was at the meeting representing the project. “So, these are going to be highly skilled jobs, as you heard, a lot of automation associated with that as well.”
The council’s support for the requested tax phase-in seemed rocky from the get-go, however, spurred primarily by concerns that information regarding the proposed tax phase-in had only been provided to the council 48 hours before Saturday’s meeting.
“Why is that?” asked Councilman Steven Clark, R-At Large. “Why couldn’t we have had it a little earlier to really kind of do some more research?”
In response, Stager noted that the score card the EDC typically uses to score potential businesses interested in seeking tax phase-ins in the county is in the process of being revamped, which increased the time it typically takes to evaluate potential companies.
“We went through a scenario where we scored it on the new version of the score card as well as the old,” Stager said of the requested tax phase-in. “In both scenarios it came up with three years. But it just took a lot longer to get through that process than I would have liked. And we were hoping that we would get more consistent opinion on that outside of the county in the local municipality. So, it just delayed us.
“We had it in the queue,” he added when pressed about the delay in notifying the council about the proposal. “All I can say is, we just had a lot of workload, and we were trying to get through the other elements as well.” Beyond the delay issue, others on the council raised several additional concerns regarding the proposal, one of which was the suggested $20 per hour starting wage, which some felt was a bit too low to warrant granting the company a tax phase-in.
Along those same lines, concerns were raised that the county is currently grappling with a worker shortage, and bringing in a company at the wage scale proposed would make it difficult for them to attract enough workers.
Still others mentioned a reluctance to support the request due to a desire to see the county diversify its businesses offerings. Prior to Saturday’s vote, it was noted that the council would only be voting on the declaratory resolution for the tax phase-in request, which if passed would still require the request to come back before the council at it’s June meeting in order for the final, confirmatory resolution to be considered for passage.
As such, some on the council suggested it may be worth allowing the request to at least move forward to the confirmatory resolution discussion, which would give council members more time to review the proposal.
“This is not the final vote on this, unless we turn it down,” said Councilman Tom Stump, R-At Large. “There will be another vote in 30 days. ... So, we’ll have 30 more days to make the final decision.”
However, all of the expressed concerns ultimately proved too much to earn the support of a majority of the council’s members, and the declaratory resolution for the tax phase-in was denied in a vote of 4-3 against passage.
Voting for passage of the declaratory resolution were council members Stump, Randy Yohn, R-District 2, and Darryl Riegsecker, R-District 3.
Voting against passage were council members Clark, Adam Bujalski, R-At Large, Douglas Graham, R-District 1, and Dave Hess, R-District 4.
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