Business applying for a tax abatement may soon have a small fee added to the application process.
The Clay County Council discussed potentially adding a charge on tax abatement applications during its monthly meeting Monday night.
"The charge can be as much as 15 percent of the tax that is abated, but we are only proposing 5 percent," West Central Indiana Economic Development District Economic Development Specialist Jim Coffenberry said. "We wanted it to be an amount that wouldn't deter businesses from applying for the abatement, yet enough to help cover costs of engineering and other expenses that come about in the process."
Money that comes from the charge would go into a fund for the Clay County Redevelopment Commission, who recommended the implementation of the charge, to use in cases where a prospective business chooses not to pay for engineering costs.
"It's a way for us to get on a level playing field," CCRC member Brian Wyndham said. "We have lucked out so far because the businesses have been willing to pay the costs out of their own pocket."
Coffenberry agreed with Wyndham that the charge would be helpful to the county, citing some of his experiences working on abatements in other counties.
"I've seen companies come in asking for an abatement, but when a county wouldn't cover the engineering costs, the company would say no and walk away," he said.
The charge would phase out in the same way the abatement does, so when the duration of the abatement is completed, the charges is no longer included. If passed, it will be added to all abatement applications in the future and will not be retroactive on current abatements.
The council conducted the first reading of the resolution and decided to table the discussion in order to research how other counties that have the charge are handling the administrative aspects of the fund. The second reading will be during the September meeting, at which time, the council may approve it.
The council also had the first reading of a five-year personal property tax abatement for Process Development and Fabrication, Inc. (PDF).
The abatement would be for new computer-controlled equipment at a total investment of approximately $726,000, with the intention to hire at least four new employees.
A representative of PDF said the company would be willing to pay the charge if the resolution were to be approved.
The abatement application will also have its second reading and be up for passage at the September meeting.
With county budget hearings coming up, the council also set its schedule for the hearings.
To allow the Clay County Commissioners to conduct its monthly meeting at its regular location, the council will begin budget hearings Tuesday, Sept. 2, at 1 p.m., in the Commissioners' Courtroom of the Clay County Courthouse. Budget hearings will continue in the morning on Sept. 3 and 4, with Sept. 5 set as an extra day if needed.
The council will also have its regular meeting Sept. 2, at 5 p.m., one-hour earlier than usual, in the Commissioners' Courtroom of the Clay Courthouse.