By By JOHN EBY / Dowagiac Daily News
William Lorenz returned to Dowagiac City Council Monday night with three questions about the new Deerpath Recycling, 55625 Woodhouse Drive in the industrial park.
First, he wanted to know how much tax money Dowagiac relinquishes by granting Industrial Tax Facilities (IFT) abatements of 50 percent for 12 years on $312,145 in real property and six years on $730,134 in personal property, such as tire recycling equipment and machinery.
Deerpath expects to create 20 jobs with its $1.23 million investment.
City Attorney Mark Westrate calculated in round numbers that if the true cash value was $1 million, and the assessed value is half of that, the personal property would decline in value each year from an initial amount of $13,750 for six years, then would exist solely as an IFT on the real property.
The city's share would be approximately one third of that figure, $4,200, the first year. The school district is made whole by the state.
Lorenz also wanted to know the intended use of 20 acres the Demskis are buying and how much truck traffic will increase from the industrial park on Pokagon Street and at M-51.
City Manager William H. Nelson Jr. noted that the 20 acres was not subject to the Oct. 24 public hearing.
Michael Demski said Deerpath's “break even” is five truckloads of 1,000 tires a day and five out with finished product. “Ten trucks a day. It could be more than that. It could be less than that. Our goal is 1 million tires a year out of the environment.”
Arthur Jackson Monday night commended Dowagiac City Council's efforts in trying to attract new businesses and jobs.
Mayoral candidate Bill Harrington remarked that he attended the last meeting and heard Lorenz ask questions about Deerpath Recycling's new facility which converts old tires into rubber pellets that can be adapted for various products.
Mayor Pro Tem Wayne Comstock responded, “Just because three council members didn't speak doesn't mean they were negative on that issue.”
Comstock told Lorenz, “We have an industrial park we're trying to develop. There's going to be more truck traffic and more employee traffic. If that is a concern, then we bring the Michigan Department of Transportation in and make amendments to the intersection where they go in and out. But that's our goal. More traffic? You bet.”
Added Third Ward Councilman Leon Laylin, “We do not grant an IFT unless all property regulations are met. They are verified and certified before they are presented at this meeting. For that reason, most of them have always been granted as long as they fall within the jurisdiction of appropriate proceedings.
Industrial development incentives “are, for the most part, established by state law,” Mayor Donald Lyons said. “We as a community have very little to say in what we can or can't do. The issue there is that the state wants all of the cities to be on a level playing field, so that each city has the opportunity to offer the same economic incentives, the idea being that they want cities to compete with cities from other states, not cities from within Michigan.
The third mayoral candidate, Howard Hall, missed the meeting to go door-to-door in Second Ward with campaign literature.