An ordinance presented to Richmond Common Council during its April 3 meeting would change requirements and the award process for companies requesting city tax abatements, which are intended to incentivize economic development activity.
Two immediate changes are raising the minimum investment by new businesses or expanding businesses to $500,000 from $250,000 and limiting personal property abatements to five years rather than 10, said Beth Fields, the city’s director of strategic initiatives.
The ordinance also would implement a 12-category scoring system with a maximum of 145 points. A company’s score would impact an abatement’s length and the annual abatement percentage based on an established guideline. For example, a company scoring from one to 72 points would receive a one-year, 100% abatement; whereas, a company scoring 131 points or more would receive a 10-year abatement that begins at 100% and decreases by five percentage points through the fifth year, then by 10 percentage points for four years and ends at 20% during the 10th year.
“The new scoring system was developed in collaboration with members of the tax abatement committee, the Economic Development Corporation of Wayne County,” Fields said. “We believe that this new system will allow us to continue providing an incentive to businesses looking to expand or locate here in Richmond while at the same time providing a higher level of tax revenue back to the city for additional expansion in the Midwest Industrial Park as well as upgrades for infrastructure in the Midwest Industrial Park.”
Maximum scores in individual categories range from five to 20 points. Some categories are all-or-nothing; some are scaled with partial points available.
Council member Bill Engle took exception with the health and wellness benefits category. Currently, companies are required to provide health insurance to receive any abatement; however, in the new system, a company not offering health benefits could score enough points to secure an abatement despite scoring zero points in that category.
“I wouldn’t be in favor of that at all,” Engle said.
He also would like to raise the $14-per-hour minimum wage that scores one point. The scoring scale provides companies paying higher wages up to 20 points.
“When we looked at what a lot of the average wages were for some of our existing companies, we wanted to be sure that those existing companies were still able to participate in the program,” Fields said.
Council referred the ordinance to its tax abatement committee for further consideration.
Grants
Three grants could provide nearly $160,000 for the city.
Council members unanimously approved beginning the process of accepting a $76,330 allocation from the U.S. Department of Energy’s Energy Efficiency and Conservation Block Grant Program. No local match is required.
“Through the Environmental Sustainability Commission and in partnership with Richmond Power & Light, we are proposing that we accept this allocation from the Department of Energy to use for a future street light project,” Fields said.
The city is currently updating street lights with energy efficient technology, such as LED lights, and the grant funding would provide that program a boost. The money is dedicated for Richmond, which needs only follow the acceptance process.
The Richmond Board of Aviation Commissioners received unanimous council permission to apply for a $64,900 grant from the Federal Aviation Administration’s Airport Improvement Program. The money would pay 90% of costs to construct a building that will house new snow-removal equipment. The state would provide $3,245 and the city’s airport funds would provide $3,245 for the building, which is expected to be about 1,600 square feet.
The city last year received grant money to purchase a New Holland tractor, snow plow, rotary broom and snow blower. The FAA grant requires indoor storage for those items.
Council unanimously voted to allow Richmond Fire Department to accept a $15,000 grant from Wayne County Foundation to install a Safe Haven Baby Box. Individuals would be able to anonymously leave a baby in the box under the state’s Safe Haven law.
A version of this article appeared in the April 12 2023 print edition of the Western Wayne News.