Planned facility not for research: Company would receive tax break for equipment

A new Monsanto facility in Greenwood would be used to package and redistribute seeds for testing purposes, as well as store farm equipment.

Research would not be done there, but the facility would still be listed as part of the company’s research and development section because it is part of the company’s seed testing process.

A tax break for the equipment in the new facility, planned east of Interstate 65, received unanimous approval from the redevelopment commission and city council last week. Even though research isn’t being done at the facility, city officials said the warehouse still should get the tax break because of the sizable amount of money being invested and the high-paying jobs it would bring.

The St. Louis-based international agriculture company that develops seeds and herbicides plans to invest in nearly $30 million of equipment at a leased 140,000-square-foot warehouse at the northeast corner of Graham Road and Southtech Drive. When Monsanto requested the tax break, the company said it would purchase $15 million in research and development equipment.

No research is taking place at the site, according to a Monsanto spokesperson.

“The warehouse space will be used to receive, package and distribute seeds for field testing,” Monsanto spokesperson Charla Lord said in an email. “In addition, this warehouse space will also serve as equipment storage for various farm and agricultural implements, such as tractors, planters and combines.”

The equipment is labeled as being for research and development because the facility is part of Monsanto’s research and development section, she said.

“The equipment is advanced automation equipment used to increase the speed and standardization of packaging and redistributing the seed when it comes into the warehouse,” Lord said.

Greenwood Redevelopment Commission president Brent Tilson said that the city is double-checking to make sure the tax break was filed correctly, but said any wording changes wouldn’t impact whether Monsanto gets a tax break and the amount it receives. His primary concerns when reviewing tax break requests are the quality and number of jobs and the type of work the company is doing, he said.

For tax breaks in Indiana, research and development can be a broad description of work that goes beyond what is done in a laboratory to cover the whole process of developing and testing a product, said Pat Sherman, a local accountant who is representing Becknell, the company Monsanto plans to lease a building from.

Still, the city is considering having the tax break adjusted by listing the equipment in a different category, so that there aren’t any concerns about whether the tax break has been filed correctly, he said.

Monsanto is requesting a 10-year, $1.6 million tax break on $28.7 million of research, manufacturing and information technology equipment. The company would pay $923,000 in personal property taxes on the equipment during that time period. The company will pay no property taxes in the first year and will gradually shift to paying the full taxes after 10 years, according to tax break documents filed with the city.

The facility will employ six to 10 people with a salary range of $60,000 to $90,000. An additional 70 temporary workers will be employed when the facility opens, though that number will drop to 20 by 2020, the documents said. These will be seasonal employees associated with harvesting efforts, a Monsanto representative told the redevelopment commission.

While the number of jobs is low, the total financial investment in the project, which is close to $40 million, is high and the tax revenue will be beneficial to the city, city council member Bruce Armstrong said.

“I’ve always been in favor of higher paying jobs even if it means a lower number of jobs,” Armstrong said.

Landing Monsanto is a huge boost for the city and will help attract other businesses to the area, Mayor Mark Myers said.

“It is a good shot in the arm to add a company like that to the community,” he said, citing the amount of money Monsanto is investing.

The tax break is necessary to make the Greenwood site financially comparable with other locations, the documents filed with the city said. Monsanto will be leasing a building that is planned to be developed by Becknell Industrial, a Carmel-based real estate firm. Last month, Becknell announced plans to construct a 140,000-square-foot building for a then-undisclosed tenant. The redevelopment commission approved a 10-year, $1.4 million property tax break for the $8.7 million building. The city council voted unanimously in favor of the tax break in its first vote, but will need to a final vote.

Becknell may receive some additional financial assistance from the redevelopment commission. The developer is being required to add a turn lane on Graham Road, Tilson said. The redevelopment commission will consider funding all or part of the work, Tilson said.

Three council members have said they want Monsanto to address concerns about any environmental impact from the site.

Armstrong is working to draft an amendment to the tax break addressing any environmental concerns, but said he didn’t have the details of the amendment yet.

“I do have some concerns about the environmental history of Monsanto,” he said.

Council members Mike Campbell and Brent Corey also said they wanted to have Monsanto address any environmental concerns before the final vote.

With the type of work Monsanto has planned, environmental concerns won’t be an issue, as it will just be handling and process grain, Myers said. Environmental concerns should always be considered for any facility coming to the city, Myers said.

At a glance

Monsanto plans to lease a warehouse in the Southtech Business Park in Greenwood. Here are some details about the plan:

Size: 140,000 square feet

What’s it for: processing, packaging and distributing seeds for testing

Employees: 30

Building cost: $8.7 million

Tax break: $1.4 million

Equipment cost: $28.7 million

Tax break: $1.6 million

Author photo
Jacob Tellers is a reporter at the Daily Journal. He can be reached at jtellers@dailyjournal.net or 317-736-2702.