Editor’s note: This story has been corrected to reflect the correct spelling of Drug Plastics Closures, Inc. CEO Rick Biesecker’s name and also corrects the definition of the blended hourly rate.
Two neighboring manufacturers in German Township have announced their intentions to expand operations that could create nearly 40 new jobs.
But the announcement made by Drug Plastics Closures, Inc., 2875 W. County Road 800N, Edinburgh, remains tentative, CEO Rick Biesecker said. A manufacturer of plastic packaging for health care products, Drug Plastics Closures is considering both Edinburgh and another facility in the Phoenix, Arizona area for the expansion, Biesecker told the Bartholomew County Commissioners Monday.
“But I can tell you if we get approval (for tax abatements from the Bartholomew County Council), that would be sufficient in my mind to tip the scales in favor of Bartholomew County and Edinburgh,” Biesecker said through a Zoom conferencing call.
The council will consider two tax abatement requests when they meet for their regular monthly meeting at 6 p.m. tonight. On Monday, the commissioners gave their unanimous approval to both abatement proposals.
A tax abatement essentially means increased property taxes created by the new development are gradually phased in over a period of time.
Biesecker‘s company is also expected to receive state incentives through the Indiana Economic Development Corp., Greater Columbus Economic Development Corp. President Jason Hester said.
If Edinburgh gets the facility, the company will construct a new 60,000-square-foot facility that will connect two existing buildings, Hester said.
The expansion would result in the creation of 35 new jobs, as well as the retention of 99 current positions, Hester said. The average wage for new workers would be $21.84 an hour later this year, but gradually rise up to $24.34 an hour sometime next year, he said.
If Edinburgh is chosen, Drug Plastics Closures Inc. plans to invest about $14.72 million in the new building, as well as about $11 million for new equipment, Hester said. They will ask the council to approve a 10-year property tax abatement for the real estate upgrade, as well as a five-year abatement for the new equipment.
The other company seeking a tax abatement from the council is located just a few blocks southwest from Drug Plastics Closures.
Tsune America LLC, 12550 N. Presidential Way, wants to build an 18,000-square-foot facility in a vacant lot next to its current building, Hester said. A manufacturer of circular saws, Tsune plans on investing $3 million into developing the real estate, with an additional $1 million spent on new equipment. Like Drug Plastics Closures, Tsune is seeking a 10-year abatement on real property and a five year abatement on property.
If the company receives the abatement and the expansion is made, Tsune plans to hire four new employees, as well as retain 31 workers already on their payroll, said Hester, along with Tsune Managing Partner Mike Riebl.
The company plans to offer a blended hourly salary of $28.88 an hour for the 35 total jobs. A blended hourly rate is the weighted average determined by taking the total payroll divided by total employees divided by 2,080 hours.
Both companies are in tax increment financing (TIF) districts. In such areas, the amount of allocations from new industrial developments to various taxing units (schools, law enforcement, fire departments, etc.) are essentially frozen.
Any increased tax revenue collected as a result of an increase in property values then go into a fund to be used for a wide range of purposes within the district to promote redevelopment. TIF districts usually expire after slightly more than 20 years.
