Five corporate tax cuts will take effect | Business

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  Five corporate tax cuts will take effect |  Business

“Economic development is a competitive sport to a certain extent,” said Brad Lau, the vice president of economic development at the St. Joseph Chamber of Commerce. “We’re competing either with other communities, from the standpoint of bringing a new company in, or we’re competing with other patients of the corporate structure for those investment dollars of existing companies.”

“Even though we’re doing tax abatement, it is new tax revenue that’s being generated,” Lau said. “More than anything, we want to keep these companies investing in the St. Joseph facilities, because just from our economic development strategy, if you keep those companies, the facilities in St. Joseph technologically up to date and you continue to expand product lines and so forth, we’re going to compete better when corporate looks at investing in facilities.”

“Through the Chapter 100 program, we are able to receive tax abatements on new tax revenues that will be generated through these capital investments we are making, thereby reducing the overall cost of the project and positioning the site favorably as business and investment decisions are made,” said a representative for Boehringer Ingelheim in an emailed statement.

The other projects are all expansions of current facilities. The abatements range from 50% to 75% for a couple of years and then decrease to about 25% to 50% to finish out the 10 years. For example, Boehringer Ingelheim will be investing $52 million and will receive a tax abatement of 75% for two years and then 50% for the remaining eight.

Story Highlights

  • Cereal Ingredients, Daily’s Premium Meats, Tyson Foods, Sealed Air Cryovac and Boehringer Ingelheim all received tax breaks to locate to St. Joseph or expand their current facilities. The city uses these tax projects as an incentive to bring more business to town.

  • Cereal Ingredients is the only project that is new to St. Joseph. The company will receive a 50% abatement on all personal property taxes for 10 years.

While companies receive a tax break, the city views it as an investment. The five projects will create a total of about 220 jobs.

“Those expansions are key to maintaining St. Joseph’s industrial vibrancy,” Lau said. “It’s great to bring in a new company, but if you have a company that closes, that has a real impact on the community. That’s what we’re trying to avoid with all of these projects.”