FORTVILLE — A Fortville manufacturer that isn’t meeting employment goals will continue getting a tax break from the town despite its shortcomings.
The Fortville Town Council on Monday voted 3-1 to continue giving Genesis Plastics Welding a discount on its property taxes even though the company has about 35 fewer employees than what business leaders promised council members in 2011 they would hire as part of an expansion if given a tax break.
Genesis, a medical and military device manufacturer operating for nearly three decades, received a 10-year tax abatement in 2011 when it expanded its Fortville operations. The tax incentive was expected to save the manufacturer approximately $350,000 over 10 years. In exchange, the business’s leaders agreed to increase their number of employees to 119. Five years into the break, the manufacturer is employing 83, officials said.
That sparked discussion at this week’s council meeting, as council members debated whether to revoke the tax break.
Annually, companies receiving tax abatements — deals often negotiated as a means of attracting new development or prompting existing businesses to expand — are required to submit paperwork detailing the company’s current performance, including how many people they employ and annual salaries, for review by county and municipal councils.
Fortville town attorney Alex Intermill said Genesis is meeting all of the goals set for the tax abatement with the exception of its number of employees and salaries. The town council had to decide whether to terminate the agreement based on that shortcoming alone.
Genesis CEO Tom Ryder pleaded with council members to give the company more time to meet the goals. He told council members the welding company fell on hard times after one of its biggest customers, which made up nearly 46 percent of Genesis’ business, ended its contract.
Now, the company’s business is picking up, and offering the tax break is still a worthwhile investment for the town, Ryder said. Currently, Genesis is looking to hire at least six new employees as work orders grow.
“We’ve got a lot of good customers in the pipeline,” Ryder said. “I have good faith … we’re going to bring that back to fruition.”
Council member Lenzy Hendrix said although the county’s taxing entities aren’t losing much money — the tax abatement saves Genesis about $30,000 annually — they are missing out on potential income tax revenue from employees who haven’t been added to Genesis’ roster.
But, given that the manufacturer lost a major client recently, other council members agreed to be lenient, continuing the tax abatement. The money the town isn’t collecting isn’t a large enough sum to make a big difference in Fortville’s operating budget, said council president Bill Hiday.
When making a motion to continue the abatement, council member Robert Holland said the company has been good for Fortville. In the next year, Holland hopes the company sees more business and new hires.
“They’ve been good corporate citizens, good partners to the town,” Holland said.