The Portage City Council is deciding whether to terminate a tax abatement to a company that promised 280 jobs but never built that plant. It ought to be an easy decision.
Tax abatements, typically for 10 years, phase in property taxes as an incentive for companies to locate or expand in a community. Too often, though, the strings attached to those abatements are ignored.
Portage is planning an Oct. 7 hearing on the termination of the abatement for Capitol Wholesale Meats Inc., which does business as Fontanini Meats and Sausage. The company announced last year it planned to build a 170,000-square-foot facility at the AmeriPlex at the Port business park on the city's north side. Construction on plant hasn't begun.
Earlier this month, the Hobart City Council decided to consider rescinding the residential tax abatement granted last year to Cressmoor Estates developer Randy Hall. In exchange for the abatement, Hall was to develop about 30 homes over a 10-year period on his 113-acre property.
City Councilman Brian Rosenbaum complained at the council's Sept. 3 meeting that Hall hasn't made good on his promise to keep the grass mowed, a promise extracted from him earlier this year when Hall was granted a one-year delay on the subdivision development.
In June, the East Chicago City Council rescinded Union Tank Car's tax abatement after that company left town, taking away more than 500 jobs.
"This puts out a message to other companies as well," East Chicago City Council President Richard Medina said at the time. "We're looking out for what's best for the city, and those who've been granted abatements should see this council as the ones who grant it, and the ones who can take it away."
That requires annually reviewing each abatement to make sure the recipients are making good on their promises.
In July, Valparaiso City Councilman Joey Larr said he hadn't seen a single annual report on any of the 52 abatements granted since 1997. It isn't enough for the city administration to review them; the council members need to see them, too.
Municipalities granting these abatements must make sure the companies make good on their part of the bargain for the full term of the abatement.
