Investment will help two local businesses

The recent upswing in growth from local manufacturing plants does not appear to be stopping any time soon.

The Dowagiac City Council gave preliminary approval to tax abatement requests from Ameriwood and Premier Tool and Die Cast during its meeting Monday evening. Both companies are seeking the relief for the purchase of new equipment for their plants.

Ameriwood, which produces ready-to-assemble furniture from its plant on Spaulding Street, is looking to purchase around $1.5 million worth of machinery, according to City Manager Kevin Anderson. Premier, on the other hand is looking to purchase $520,678 worth of equipment for its Dowagiac branch, located on N. Paul Street.

“All in all, they’re pretty solid investments,” Anderson said. “Both are looking to hire more people as a result of them, and they would qualify for up to a 12-year abatement based on the standards we have set in our economic development plan.”

Both companies are expected to generate nearly $3,000 worth of additional tax revenue for the city
every year as a result of the expansions, Anderson said in his report to the council.  The city had previously approved tax abatements for both manufacturers in 2008.

City leadership recently adopted a policy establishing the guidelines when considering Industrial Facilities Exemptions for area businesses, including the amount of money invested, total jobs created, how many locals will be employed and the size of the company’s annual payroll.

In May, the council approved an IFT proposal from automotive-part plant Creative Foam. The company recently poured nearly $772,000 into equipment for its facility, with the expectation of generating 10 new jobs in the process.

With the recent passage of the Proposition 1 ballot proposal, which calls for the gradual elimination of personal property tax on industrial equipment, Anderson said he expects to see less of these IFT proposals from Dowagiac businesses in the future.

“There will be less and less of an incentive down the road for folks to look at this option,” Anderson said.

Public hearings for both proposals will be on Sept. 22, before the council makes its final approval.

Other business passed by the council Monday included:

• The purchase of a replacement for the city’s pick-up plow truck from C. Wimberley Automotive Group for $27,239.

• The purchase of a replacement pull-behind leaf vacuum for around $30,000.

• The authorization of adjustments to the city’s budget.

• The authorization for a new, three-year collective bargaining agreement between the city and the Police Officers Labor Council.