Tuesday, November 25, 2014

Tax abatement to aid Monoflo startup, new jobs

By DOUG CARDER, Herald Senior Writer | 12/10/2012

Monoflo International, which is preparing to open by early January at Ottawa’s Industrial Park, has received some assistance in defraying its start-up costs through a city-approved tax abatement.

Ottawa city commissioners voted Dec. 5 to approve an ordinance that grants Monoflo International a 65-percent tax abatement for the first 10 years of operation, Scott Bird, the city’s finance director, said.

Monoflo International, which is preparing to open by early January at Ottawa’s Industrial Park, has received some assistance in defraying its start-up costs through a city-approved tax abatement.

Ottawa city commissioners voted Dec. 5 to approve an ordinance that grants Monoflo International a 65-percent tax abatement for the first 10 years of operation, Scott Bird, the city’s finance director, said.

Monoflo, a maker of plastic products, 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. The company 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.

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, Bird said. 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, he 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.

“It will help FCDC build a fund that will allow further recruitment activities,” Bird said Monday of the Monoflo agreement.

The result provides Monoflo with a net abatement of 55 percent, Bird said.

No one spoke against the proposed tax abatement at the public hearing in November.

comments powered by Disqus