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Cummins will pay more than $6.2 million in property taxes in Bartholomew County this year, about twice as much as the second-largest property taxpayer, NTN Driveshaft.
The county’s top 10 taxpayers this year will pump nearly $15 million into local governments’ coffers, according to figures provided by the Bartholomew County Auditor’s Office. That’s enough to pay for the Columbus Fire and Police departments.
Cummins is the top taxpayer in real property (land and buildings) and personal property (machinery and everything else that would fall out of a building if you turned it on its head).
Local taxes play a role in companies’ local investment decisions; but companies sometimes are willing to pay higher taxes if they are outweighed by other, potentially more important factors, company officials said.
“We take a lot of factors into consideration when we decide where to locate a facility or part of our business, including taxes,” Cummins spokeswoman Janet Williams said.
“As you can see from some of the other announcements we have made, we look at community, education and other issues as well.”
When Cummins announced last year that it would hire 600 more professional employees and place them in a new $17 million downtown office complex adjacent to The Commons, the company requested that the city spend $1 million on local education initiatives.
Williams said that a lot of factors can outweigh the local tax rate, including the availability of qualified employees, access to customers and suppliers and local infrastructure.
Other factors play a role, too. The recently announced $219 million investment in Seymour, for example, which included the creation of 290 jobs, made sense in part because it consolidated high-horsepower design, engineering and production at a facility that already was producing high-horsepower engines. In those situations, the property tax bill may play a negligible role.
Cummins’ tax bill in Bartholomew County has nearly doubled in the past four years, in large part because the value of its local property has risen.
In 2008, Cummins paid nearly $3.2 million in local property taxes. The value of its land, buildings and property was assessed at $160 million. This year’s bill of $6.2 million was based on an assessed valuation of nearly $242 million.
The county’s second-largest taxpayer, NTN, also has seen its bill about double during that span.
NTN, which also is the county’s second-largest employer, makes bearings and constant velocity joints at its campus in Woodside Industrial Park.
“We always would like taxes to be lower,” said Barry Parkhurst, vice president of administration.
At the same time, however, the company expects to have good infrastructure at the airport, nice roads and reliable fire protection, he said.
“We don’t want to sacrifice (on) services,” Parkhurst said. “That obviously doesn’t come free.”
Parkhurst emphasized that tax abatements, which allow companies to forgo paying property taxes on new investments for typically 10 years, help sway companies to make investments locally.
NTN, for example, has about a half-dozen other manufacturing operations in North America, Parkhurst said, and tax abatements make it easier for local NTN officials to sway the corporate decision-makers to invest in Columbus.
The biggest challenge that NTN faces right now has nothing to do with taxes: With the local unemployment rate hovering near 6 percent, the company is having a tough time finding qualified employees when it needs them, Parkhurst said.
Toyota Industrial Equipment Manufacturer, a forklift maker, also in Woodside Industrial Park, is paying a tax bill of $1.2 million this year, ranking third. No other taxpayer is paying more than $1 million.
The top 10 also includes retail giant Walmart, FairOaks Mall and the owner of the Cummins Corporate Office Building, which Cummins is leasing until at least 2019. Cummins owns the land but has leased the building since 1983.
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