Ottawa city commissioners will consider establishing a property tax exemption for Ottawa Industrial Park’s newest tenant at their Dec. 5 meeting.
The maker of a variety of plastic products, Monoflo International, is in the process of hiring 15 local workers with the intent of starting its Ottawa operation by early January. The company plans to expand to about 65 workers in the first five years of operation, a company representative recently told city commissioners.
Monoflo in August acquired the former Kennel-Aire LLC facility, 1550 N. Davis Ave., Ottawa. The Winchester, Va.-based company is renovating the space and bringing in equipment from its Reno, Nev., plant. Monoflo representatives have told the city it plans to make a $6 million investment in its Ottawa operation.
To help the company defray some of its start-up costs, Monoflo International is seeking a 65-percent tax abatement for the first 10 years of operation, Scott Bird, the city’s finance director, told commissioners during a public hearing on the proposed tax abatement in early November.
An independent tax abatement cost-benefit analysis, prepared by the Kansas Department of Commerce, showed the city would receive $6.25 in benefits for every $1 of abated taxes over the course of the 10-year abatement period. The cost-benefit analysis was quite favorable and more than enough to meet the city’s benchmark of a 1.3 to 1 benefit-cost ratio, Bird said.
As part of the proposed abatement, Monoflo agreed to pay $9,300 per year — 10 percent of the taxes to be abated each year — to Franklin County Development Council, for a total of $93,000 over the course of the next decade, Bird said. The result provides Monoflo with a net abatement of 55 percent, he said.
No one spoke against the proposed tax abatement at the public hearing.
The commission agreed Monday to put the item on its Dec. 5 agenda.