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HomeMy WebLinkAboutPublic Hearing 6-1-2020- IFEC - Oakland Industries CITY OF LIVONIA PUBLIC HEARING Minutes of Meeting Held on Monday, June 1, 2020 ______________________________________________________________________ A Public Hearing of the Council of the City of Livonia was held at the City Hall Auditorium on Monday, June 1, 2020. MEMBERS PRESENT: Kathleen McIntyre, President Scott Bahr, Vice President Rob Donovic Jim Jolly Brandon McCullough Laura M. Toy Cathy K. White MEMBERS ABSENT: None OTHERS PRESENT: Mark Taormina, Director of Economic Development Todd Zilincik, City Engineer Paul Bernier, City Attorney Sara Kasprowicz, Recording Secretary The Public Hearing was called to order at 7:01 p.m. with President Kathleen McIntyre presiding. This is a Public Hearing relative to Kris Morris, Oakland Industries, is requesting approval of an Industrial Facilities Exemption Certificate for a facility which will be primarily used as an office and warehouse location for Oakland Automation and Autotac, subsidiaries of Oakland Industries, located at 13107 Newburgh Rd Livonia, MI 48150. (Industrial Development Overlay District #110). The Public Hearing is now open. There was one person in the audience. Morris: Hi, Kathleen, can you hear me? McIntyre: Who is speaking, please? Morris: This is Kris Morris from Oakland Industries. McIntyre: Hi Kris, good evening. I couldn’t tell, yes, we can hear you. Morris: Good evening. McIntyre: Would you like to share any information with the Council? 2 Morris: Yeah, so, can everybody hear me ok? Toy: Yeah. Morris: Cool. Oakland Industries is a holding company for three subsidiaries. One of which is InterClean Equipment which is actually located out of Ypsilanti. They design, engineer and install heavy duty wash systems. So, I think of anything bigger than an F350, we’ll design, engineer, build it and install it. That’s a global operation. We’ll do military mining, transit vehicles, things of that nature. Our two other businesses are Autotac and Oakland Automation. Autotac was purchased in December of 2016 and they do tackoff and blow off machines. Tack off and blow off machines are used primarily in the automotive industry, prior to paint application to ensure that they paint on the outside of the vehicle goes on flawlessly. Really to make sure there is no excess material on the outside of the vehicle. So, again, they are about an eight-person operation out of the Livonia building. They just moved there from Troy. We then have Oakland Automation. So, Oakland Industries purchased Interclean and Autotac and we formed Oakland Automation. They were previously in Novi and they moved to the Livonia building here in the beginning of the year. Oakland Automation is what I would call a system integrator. So, we take multiple systems and combine them together to create one, large, robust system. Oakland Automation specializes in dispense robotics. So, really, what we do in a very simple term, is, we create robotic paint lines. So, we paint vehicles, we paint axles, we paint airplanes, anything of that nature. A lot of our large companies are large OEM’s, but we’re also in general industry as well as aerospace. So they, Autotac and Oakland Automation, moved into the Livonia building here at the beginning of the year, we have most of our office there, so we have about 16-20 Engineers and about 8-10 shop employees as well that work in the warehouse. That’s really what Oakland Industries does and then specifically to Oakland Automation and Autotac. McIntyre: Alright, thank you, Mr. Morris. Council, do you have any questions for Mr. Morris? Toy: What’s he seeking again? McIntyre: An Industrial. Toy: For how long? McIntyre: Mark, do you want to? Taormina: Yeah, yeah, I can thank you, Council and Kris. Kris and I spoke the other day about the project. So, Oakland Industries is seeking a ten-year tax abatement under PA-198. With thirty-five expected jobs and with a minimum 3 investment of $500,000.00 they would qualify for a ten-year tax abatement. If approved, the new first year real property taxes on the full investment would be about $12,600.00 so this would be a savings to the business of about $10,000.00. The City portion would be about $2,700.00. There’s a smaller amount of personal property tax savings. I’ll just note that in 2019 taxes on the real property were slightly more than $36,000.00 and that’s based on a taxable value. The existing taxable value of about $615,000.00 on the property, so, as is the case, with all PA-198, tax abatements, approval does not reduce any of the existing tax assessments. The IFEC would reduce the tax liability only on the new investment, which is an amount equal to about 50%. Everything appears to be in order with the application, the ten-year request is fully in line with the City’s recommended duration chart, that I believe, each of you should have a copy of. Toy: Madam Chair? McIntyre: Just a minute, I’m sorry, Councilmember Toy, Vice President Bahr had his hand up. Bahr: Yeah, just a couple of more questions for Mr. Morris. You were talking through some employees that are moving into this building, or have moved in from Troy, from Novi. How long have you been in Livonia at this building and how many employees are there now? Morris: So, we officially closed on the building in August or September and we th moved our employees in January, I believe it was January 6. From Troy, we have eight employees, two of those employees are actually still up there on a small assembly shop. From Novi, we have about twenty-two employees. Altogether, right now, we have thirty employees there. Our business plan called to go up to thirty-eight. Given the current economic situation, we have held off on any hiring, so currently, we are at thirty right now. Bahr: Ok, thanks. McIntyre: Thank you, anyone else from Council, any questions? Toy: Madam Chair? McIntyre: Yes, Councilmember Toy? Toy: What I wanted to ask is, this is for ten years. Mark, if I may, Madam Chair, to Mark, he can go up to twelve, correct? Taormina: That is correct. 4 Toy: They’re just asking for ten, then? Taormina: That is correct. Toy: Madam Chair. As we moved forward with budget constraints, does there appear to be, after all the fun stuff we’re living through right now, I’m being sarcastic, it’s not fun, obviously, but I think we got to pay close attention to how we are assimilating money. Yep, we want our businesses to be there and we want to welcome this business in and so I’m going to, with caution, offer, since he’s not asking for a full twelve years, I’m going to offer an approving for the ten years that the Petitioner is requesting. McIntyre: Anyone else on Council? Bahr: Madam President? McIntyre: Yes, Vice President Bahr? Bahr: Following up on Councilwoman Toy’s comments. Obviously, it’s good for us to be weary of budget issues right now with the environment that we’re in, but just a reminder of what Mr. Taormina said earlier that with an exemption like this, we’re not giving up in the tax revenue, we are foregoing some tax revenue for a certain period of time. I think that’s important to remember and also, just obviously, it’s a business that’s investing in our community and then as you all know, one thing that I look for that I think is really important for us is the that the City is consistent in how we apply these. We have applied this in many, many similar situations to this, so I do think it’s appropriate to move forward with this and I appreciate our City’s aggressive approach with these type of things in order to continue redeveloping our city. McIntyre: Alright, Councilmember McCullough. McCullough: Thank you, Madam President. After kind of doing a little research, just to let anybody that’s watching out there know that this building, if I’m right, was constructed in 1986 and I know it sits on Newburgh Road. This is also the investment that the Petitioner will be putting into the facility, hopefully rubbing off on some of the neighbors to maybe do some improvements on their own facilities. Plus, I’ve actually had the bandwidth working with Interclean, it is pretty unique product when it comes to design build for large vehicles. Just hearing some of the innovation that comes to the community, I think that the ten-years would be just fine on that so, I will also be in support of this. McIntyre: Very good, thank you, Councilmember McCullough. 5 Bahr: Madam President, one more, I’m sorry. McIntyre: That ok, Vice President Bahr. Bahr: I don’t recall. Can something like this go on Consent? McIntyre: No. Bahr: It cannot? Ok, thanks. McIntyre: Alright, anyone else? I don’t see that anyone else from the audience wishes to speak. No one else on the Council. Mr. Morris? Morris: Yes, ma’am? McIntyre: This will be on the agenda for the Regular meeting of the Council scheduled , to take place on June 222020. I saw the Governor’s Executive Order, Mark, maybe you know or if Paul is still on. Does the Governor’s Executive Order th for virtual meetings still extend through the 30 of June? Bernier: The New Order, which I’m reading on my other computer screen, I was trying to do two things at one time, doesn’t address at all, the issue of the th Open Meetings Act. Her previous order went, I believe, until the 15 of June, I fully expect, looking at this Order though, that she is going to extend it because you can’t, especially the number of people that are allowed indoors wouldn’t allow for any kind of robust open meeting, let me put it that way. McIntyre: It’s still ten, right, we’re still limited to ten indoors. Bernier: We are limited to ten indoors. McIntyre: Thank you. One hundred if we have it outdoors. Bernier: The weather is nice. McIntyre: Yes, it is. Anyway, Mr. Morris, so you can assume that it will be another Zoom meeting. Morris: Great, thank you very much, I appreciate that. McIntyre: Thank you very much, Mr. Morris. Alright moving on. As there were no further questions or comments, the Public Hearing was declared closed at 7:13 p.m.