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Groveport takes action to create and save jobs in town
(by Rick Palsgrove, Southeast Editor - February 09, 2010)
Groveport village officials took steps to battle the rocky economy by enacting legislation to enhance job creation and job retention in town.
At its Feb. 8 meeting, Groveport Village Council approved two ordinances to enter into local development and incentive agreements with two companies located in the village.
One agreement is a 10 year incentive program to enhance job creation and expansion with Eddie Bauer LLC, a clothing business with a 2.1 million square foot facility located at 6600 Alum Creek Drive.
The other agreement is a three year incentive program with Amsted Rail LLC to help retain jobs at Griffin Wheel, a railroad wheel manufacturer, located at 3900 Bixby Road.
Under the legislation, the companies will receive a payment from the village's non-tax revenue (such as fines, fees, recreation revenue, golf fees, etc.) based on a percentage of the income tax the company generates for the village.
To obtain a revenue incentive payment based on 30 percent of income tax generated by new jobs, Eddie Bauer, which employs about 350 in Groveport now, will have to create at least 100 new jobs generating $2.2 million in payroll by Dec. 31, 2010; at least 200 new jobs generating $4.4 million in payroll by Dec. 31, 2011; and at least 325 new jobs generating $7.1 million in payroll by Dec. 31, 2012.
So, for example, if by Dec. 31, 2011, Eddie Bauer has added 200 jobs with a $4.4 million payroll, their revenue incentive payment from the village would be 30 percent of the amount of income taxes generated by the $4.4 million payroll.
Starting in 2013, if Eddie Bauer has created at least 750 new jobs with $16.5 million in payroll, their revenue incentive payment based on income tax generated will be 35 percent.
To obtain a revenue incentive payment based on 30 percent of income tax generated by current jobs, Griffin Wheel, which employs about 145 in Groveport now, will have to retain those jobs for three years.
"I can think of no better use of funds than this situation," said Groveport Economic Development Director Jeff Green. "It will bring and retain jobs in Groveport."
Green said Eddie Bauer's parent company, Golden Gate Capital, is consolidating and bringing in the operations of several of its Internet companies into Groveport, adding, "With this plan we can retain a valuable company in our community and hope for amazing growth."
Green said Griffin Wheel has not asked for financial incentives before from the village. He said rising utility costs and the poor economy had the company considering consolidation with one of its four other facilities located elsewhere in the country. He said this new legislation avoids that possibility.
Groveport Finance Director Ken Salak said the incentives agreements are good for the village.
"The increase in jobs will more than offset what we will pay out," said Salak. "We will realize much more in income tax revenue coming back to us than what we will pay out in incentives. It would be a much worse impact on us if the companies left and we would lose those jobs and the income tax revenue that comes with them."
Other Groveport financial news
Salak reported village income tax revenues so far in 2010 are $1.39 million, an increase of 1.9 percent compared to this time in 2009 when revenues were $1.37 million.
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