Tax break rejected

A tax break for a new industrial building proposed in Greenwood was rejected by the city council over concerns of what company would move in, how many jobs it would create and how much those jobs would pay.

The future of the project is now unknown. No decision has been made about how the company plans to proceed, said Pat Sherman, a local accountant representing the company that planned to develop the building.

Becknell Industrial had requested a 10-year, $1.4 million tax break for an $8.7 million, 140,000-square-foot building that would be built with just the exterior walls and roof and not finished inside, since no tenants have been identified yet.

The building, planned for the Southtech Business Park, initially was intended for Monsanto. After public opposition, Greenwood withdrew a tax break offer and Becknell resubmitted its request, this time listing its project as a shell building without any projections on the number or types of jobs the project would create.

Greenwood Mayor Mark Myers described the council’s action as shortsighted. The city doesn’t have enough empty buildings for developers, and shell buildings help fill that void, he said. After the city council turned down the tax break, Myers questioned the council’s decision.

“I don’t understand the reason why anyone, unless you just don’t want business in Greenwood, would vote against a shell building,” Myers said.

But Greenwood City Council members said the city has no idea who will use the building and any company could move in, such as a distribution center, which some council members don’t want because of low paying jobs, or a company the city has previously decided against giving financial assistance to, such as Monsanto.

The city council is required to vote twice to approve a tax break, and council members decided to vote on both approvals in its meeting this week. The initial tax break vote was approved, but the second was turned down by the council with a 5-4 vote, with uncertainty about the future use of the building the primary reason for the rejection.

Council members Brent Corey and David Lekse said they voted against the tax break because of concerns the building would become yet another distribution center, which would bring in low paying jobs.

The city needs to be willing to accept companies that have an interest in coming to the area, Myers said. Distribution companies are interested in Greenwood right now, and if the city wants to continue adding businesses, officials need to work with them, he said.

Council member Bruce Armstrong said he wasn’t going to vote in favor of a tax break unless the company made clear the number of jobs and salaries and benefits offered.

With a speculative building, providing any numbers would be hypothetical, something Myers said he doesn’t feel comfortable with.

“I can guarantee you that there aren’t any guarantees,” Myers said.

When a tenant does move into the building and requests a tax break on their equipment, the city can vet the jobs then, Myers said. The city has turned down tax break requests from six businesses in the past three months because their salaries were too low, Myers said.

The uncertainty that comes with shell buildings is simply part of the development process, but the buildings are needed because businesses don’t want to wait the extra nine months to build from the ground up, he said.

Council member David Hopper cited concerns about Monsanto or one of its affiliates still wanting to use the building. Monsanto has said it no longer has plans for a facility in Greenwood. Council member Ron Bates said he voted against the proposal because he thought it had been rushed through the council too quickly.

The denial of tax break was a huge shock, council member Chuck Landon said.

“The Becknell deal was reasonable,” Landon said. “They stuck it out even after Monsanto backed out. They still wanted to ride with us and put a business here.”

Myers and Landon said they were concerned that turning away developers like this could lead to future businesses deciding not to come to Greenwood.

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