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Archive for Friday, October 16, 2009

Amarr Garage Doors seeks tax break

October 16, 2009

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Amarr Garage Doors wants to start cashing in on a 10-year tax break approved six years ago.

Lawrence city commissioners on Tuesday will consider activating a tax abatement that had been approved by commissioners in 2003, but has yet to be implemented.

The abatement would save Amarr an estimated $120,400 a year in property taxes on property and equipment associated with an expansion at the company’s plant in the East Hills Business Park.

Amarr started the expansion project in 2004, then delayed it while the company focused on adding a call center for customer support. Amarr finished its manufacturing expansion in late 2007.

The push to start the latent abatement comes as Amarr grapples with a continued downturn in residential construction, its main business market. Late last year the company had about 600 employees in town before announcing it would lay off 100 workers, and Amarr has had other employment adjustments since then.

“At this point we just have to sustain our business and make sure that when this thing turns around we’re stepping out with our best foot forward,” said Delbert Phlipot, Amarr’s vice president for manufacturing. “Every little bit helps, particularly during these tough economic times that we’re in.”

The center at 3800 Greenway Circle now has about 490 employees, of whom about 40 work in jobs created by the expansion. In 2003, Amarr had said that the expansion would create 80 jobs.

Roger Zalneraitis, the city’s economic development coordinator/planner, recommends that commissioners approve Amarr’s tax break, despite the employment shortfall. Among his reasons:

• Amarr actually spent $19.1 million on the expansion and equipment, or $2 million more than had been outlined in the original agreement. The company also spent an additional $1.1 million since 2006 for equipment, although that additional equipment is not subject to taxation.

• Because the abatement has not yet taken effect — Amarr would like it to start Jan. 1 — the company’s employment levels, for compliance purposes, shouldn’t be measured until December 2010, Zalneraitis said. The city then “would assess their compliance with their performance agreement and make any adjustments to the abatement at that time,” he said, in a memo forwarded to commissioners.

Under standards established in the city’s economic development policy, Zalneraitis said, Amarr would be considered as achieving 95 percent compliance with its performance agreement — a percentage that would be high enough to justify granting the entire tax abatement as originally outlined.

Abatements typically take effect once a qualifying project is completed, City Manager David Corliss said.

“It’s just taken them a little bit longer, but they’re a great employer in the community and we’re glad they’re here,” Corliss said. “We understand their economic challenges and we’re hopeful that they will continue to grow and prosper.”

The Lawrence plant produces about 90 percent of all garage doors for Amarr, which is based in Winston-Salem, N.C.

The commission meeting is set for 6:35 p.m. Tuesday at City Hall, Sixth and Massachusetts streets.

Comments

nowthetruth 5 years, 2 months ago

I know a person who works in management at Amarr. They have done so many things to keep this business viable. They have removed a lot of "fluff" and kept the important things. My friend said that they even kept their medical premium increases to $5.00 per month, considering the skyrocketing health care crisis! I am glad Amarr is sticking around. The "wonderful employer" who is also in that business park, never even came close to meeting their abatement responsibilities and is now leaving our town and abadoning it's employees...

WHY 5 years, 2 months ago

I am also a great member of this community, so that means that I get to pay less in taxes. If you don't give me a tax break I will leave and take my earning potential elsewhere.
(See, the stupidity is more apparent when you use an analogy.)

Richard Heckler 5 years, 2 months ago

Tax abatement = tax increase for the community.

At a time when the mayor and commissioners keep telling us the city is broke.

USD 497 has spent about 20 million on sports facilities

Park dept is engaged in a 15 -20 million dollar sports facilities project at Clinton Lake

City has potholes everywhere although those can be fixed with a phone call

City wants to extend 31st to county road 1057

Bedroom communities require high taxes to support

Residential housing does not pay back taxes considering what they demand

City is busy annexing more and more = extending the tax bill

City is extending water lines to the airport = extending the tax bills

Are hard times the best time to give away tax dollars?

wholegrain 5 years, 2 months ago

Read the article everyone... invest $21 million dollars into an existing business that employes 500 people and we will give you $120K in tax relief. That's a spit in the bucket. I think we should be thankful Amarr continues to invest in it's people and this LEFT WING community. Let's face it... it's not the most appealing of communities to invest in....

glenner 5 years, 2 months ago

Well lets all hope Amarr gets the abatement so they don't up and leave town like Sauer Danfoss is doing, and throw the Amarr employees to the wolves also.

wholegrain 5 years, 2 months ago

Glener-you are exactly right... Sauer just bailed completely, they never met any of their obligations to this community...

quik 5 years, 2 months ago

To merrill's point, is this the best time to be giving away Lawrence tax dollars? I would be surprised if more than half of Amarr's employees reside in the city of Lawrence. Many live in the outlying towns like Perry, Tongie, Oskie, etc. That's not unique to Amarr, most of the Lawrence manufacturing operations likely have a similar make-up. Would it be fair for the city to impose an added payroll tax for employees living outside the city and working at a business that is receiving tax breaks from the city?

Richard Heckler 5 years, 2 months ago

Why do we have to pay companies to stay in the community?

Why do we have to bribe companies with tax abatements.

Whenever this concept was introduced it was a mistake. Taxpayers have been taken to the cleaners ever since.

Tax incentives = dumb economics.

Sauer Danfoss is hitting the road oddly enough at the time their 10 year abatement expires. There have been plenty others ahead of them.

Perhaps tax incentives should be reserved for local business people who have been in business for 12 years or more. Instead of giving new competition an advantage over those who have put in money and sweat. AND more than likely opened a business on their own.

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