Title
Resolution to Approve Industrial Facilities Exemption Certificate between the City of Ann Arbor and Edwards Brothers Inc.
Memorandum
Attached for your review and approval is a resolution and proposed abatement agreement (Industrial Facilities Exemption Certificate) for Edwards Brothers Inc. The purpose of this abatement is to attract and retain corporate investment in the City of Ann Arbor.
Edwards Brothers Inc. is an Ann Arbor based company that is in the business of book printing and binding. The company is requesting an abatement of $5,478,568.00 of new equipment and equipment upgrades and building improvements (see addendum to the attached proposed agreement). Only $3,905,514.00 is new equipment that would qualify for an abatement from the City.
City Council did approve a prior abatement to Edwards Brothers on 11/5/2007. It should be noted that Edwards Brothers was not able to sustain the employments levels identified in the previous abatement in this economy. Edwards Brothers had 480 jobs at this location in 2007. The agreement stated they would retain 95% of the jobs during the abatement. The abatement request filed on October 11, 2010 shows 415 jobs at this facility or a 13.5% decrease in jobs.
In addition Edwards Brothers has brought suit against the City in the Michigan Tax Tribunal to reduce the assessment of their Real Property in 2010. If a reduction is obtained it would be contrary to section 4 of the 2007 agreement.
In working on this application, staff noted that the location and size of this site may be attractive for the University of Michigan. The site is a large parcel located adjacent to a U of M park & ride lot. If U of M acquired the site, it would be removed from the City’s tax rolls. The City is interested in keeping the parcel on the tax rolls and in response to the City’s interest Edward Brothers was willing to include a right of first refusal to purchase the real property during the length of the abatement. This...
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