WILMINGTON — Clinton County commissioners voted to continue the tax abatements for four companies, although one of them the past two years has not met the stipulated number of new jobs it agreed to create.
The companies with the prior tax-incentive construction deals are Ahresty, Alkermes, AMES, and BrightFarms.
In a tax abatement agreement, a company commits to creating a certain number of new jobs, and in exchange the level of taxation on a company’s new construction is lowered for a specified period of time.
In a 2015 Enterprise Zone (EZ) agreement that calls for a 75 percent tax abatement for 10 years on the real property of an expansion project, Ahresty Wilmington Corp. committed to create 20 new jobs. While the company easily surpassed that number according to an annual status report in February 2018, it has not been able to maintain that new employment.
According to Ahresty’s status report this month, at the end of last year it had 649 full-time permanent employees. That compares to 665 full-time permanent employees at the Wilmington facility prior to the January 2015 EZ agreement.
Clinton County Auditor Terence “Terry” G. Habermehl is the chairperson of the Tax Incentive Review Council (TIRC) which checks for the compliance of local construction projects that are granted tax abatements. He told county commissioners Wednesday that Ahresty officials think a lot of their situation has to do with COVID and with the employment difficulties many businesses are having.
“We did tell them that they needed to somehow make progress toward that [fulfilling their commitment to new jobs],” said Habermehl.
If TIRC members don’t see progress on that front, their recommendation to continue the company’s tax abatement on the project may change, he said.
Habermehl said it’s his understanding that Ahresty has at least 20 positions open that they’re trying to fill.
“So they’re trying, they’re just not getting there,” the county auditor said to commissioners.
Clinton County Auditor’s Office staffer Danette Garringer, who presented the status reports to the commissioners, said Ahresty’s chances of meeting the EZ agreement’s new employment stipulation got worse when reportedly 19 people quit at the end of last year.
The construction projects of the other three companies all met or surpassed the job creation terms of their respective agreements with local governmental jurisdictions.
In a status report, Airborne Maintenance & Engineering Services (AMES) attributes 335 new jobs to the July 2014 Tax Increment Financing (TIF) agreement it was granted for a hangar construction project. At the time of the agreement, the company projected 259 newly created jobs.
The parcel TIF agreement involving AMES provides a 100 percent real property tax exemption on the hangar for 25 years.
In Alkermes’ status report, the company attributes the creation of 51 jobs to its 2015 EZ agreement that provides a 60 percent tax exemption rate for 10 years on the real property of an expansion project. That is the exact number of full-time permanent jobs it committed to create in the EZ agreement.
As a side note, Alkermes states in the status report that the number of full-time permanent employees as of the end of last year at its Wilmington-area facility was 518 workers.
BrightFarms, at the time of its EZ agreement, projected to create 30 full-time permanent jobs as a result of building a large greenhouse on Davids Drive. As of the end of last year, it reports it had 36 such employees at its greenhouse operations here.
In the EZ agreement, BrightFarms was granted a 75 percent rate of taxation abatement for 10 years on the real property that resulted from the construction of the facility.
A next step in the annual tax abatement review process is for Wilmington City Council to vote on the applicable agreements as to whether to go along with the TIRC recommendations.
Reach Gary Huffenberger at 937-556-5768.
