City Council considers 2 incentives for Libbey
10/19/2010Toledo City Council Tuesday discussed offering tableware manufacturer Libbey Inc. two tax incentives in an effort to have the firm invest in its North Toledo plant and add 50 jobs.
Brad Peebles, commissioner of economic development, said the incentives are Toledo's effort to have the company create jobs and retain 1,240 others.
"Libbey is postured to invest about $10 million in machinery and equipment and facility updates for their operations here in Toledo, and as an incentive we have proposed to offer them a Toledo Expansion Incentive grant and a municipal jobs creation tax credit," Mr. Peebles said.
That grant would give the company a 30 percent rebate on payroll withholding taxes for 10 years. That is valued at $6,000 a year for the 10 years, he said.
The municipal jobs creation tax credit would grant Libbey a tax exemption of 40 percent of the municipal payroll taxes of the eligible new employees.
Council's vote would clear the way for the company to accept the incentive that has been approved at the state level.
In June, four northwest Ohio businesses, including Libbey, were approved for state job-creation tax credits involving proposed expansion projects.
Libbey is considering spending $9.5 million for machinery and equipment, plus $500,000 in renovations at its Ash Street factory.
The 50 added jobs would pay an average of $14.80 an hour, according to the tax-credit application.
The Ohio Tax Credit Authority awarded Libbey a 40 percent credit for six years, valued at $82,567.
The glass tableware company's factory in Shreveport, La., is in competition for the $10 million project, according to Ohio Department of Development filings.
Company officials were not available for comment Tuesday.
Councilman Adam Martinez during council's agenda review meeting Tuesday questioned if the company would invest in another plant elsewhere in the country rather that the plant on Ash Street in North Toledo if the city declined the incentives.
Mr. Peebles replied: "They are ready to move."
Councilman Rob Ludeman, chairman of council's economic development committee, said the expansion would be a positive sign for the local economy.
"It's incumbent on us to do what other communities have the ability to do in order to maintain the work force in the city of Toledo," he said.
Council could vote on the incentives during its regular meeting next week.
In other business Tuesday, council reviewed legislation that would authorize Mayor Mike Bell to accept a $3,591,715 grant from the U.S. Department of Housing and Urban Development.
The money is part of the third round of funding for the Neighborhood Stabilization Program and was allocated as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Jen Sorgenfrei, Mayor Bell's spokesman, said.
The money's purpose is to establish "financing mechanisms for purchase and redevelopment of foreclosed homes and residential properties" according to the legislation.
It also can be used for establishing land banks for foreclosed homes, demolishing blighted structures, or redeveloping demolished or vacant properties.
About 250 cities and counties nationwide received allocations in the third round of the program. Toledo's grant placed the city in the top 50 nationwide.
Toledo's award was the third-highest allocation among Ohio cities and counties - higher than Cincinnati's $3.1 million award. Toledo has received $25.8 million since 2008 from HUD for the Neighborhood Stabilization Program.
Contact Ignazio Messina at:
imessina@theblade.com
or 419-724-6171.