Incentives for rural investment
The Marion County Board of Commissioners approved three-year, property-tax exemptions for new NORPAC owners PNW Vegco, LLC, along with St. Paul-based Marion Agriculture Service, as part of its Rural Industrial Investment Exemption initiative.
During its Wednesday, May 13, meeting, the commissioners heard from the county's economic development coordinator Jason Schneider and SEDCOR's Nick Harville.
Schneider apprised the board of Marion Ag's investment of an additional $2.1 million into their property that would normally be taxable.
"Under this exemption, that increased taxable value would be abated for three years," Schneider said, adding that the total exemption over that time amounts to $72,984.
Prior to the county's approval, Marion Ag had been approved by other taxing districts required to receive the abatement, so the county's nod was the final step in the process.
"This would actually be the last step for Marion Ag to move forward," Schneider said. "The other one (PNW Vegco) has not yet moved through those steps."
Two other rural businesses have been previously approved for the relatively new rural industrial improvement process: Woodburn's DK Fab and Hopmere Cold.
PNW Vegco anticipates investing $15 million into the Brooks plant, which provides for an exemption of $179,068.50 per year for three years; $537,205 total.
"This isn't a reduction in their taxes," Schneider clarified. "This is just deferring the increased taxes for three years."
In order to qualify for the abatement, rural businesses must invest at least $2 million, but cannot claim more than $20 million worth of exemptions.
The county's three-year exemption aims at encouraging rural investment and jobs by providing some tax relief following significant infrastructure improvements.
"This initiated as the result of one of our popular wineries here in (the county) that did a very large expansion," Commissioner Kevin Cameron said. "They immediately got an increase in their property tax bill within months after the work was done."
Cameron said the owners needed time to boost revenues to pay all of their expenses. Upgraded property values will still increase the taxes on those properties, but that increase is deferred for several years.
"This is a rural incentive, like an enterprise zone, (encouraging an existing business) to expand that business in a physical asset," Cameron said.
"Obviously, as they expand these businesses, and they put in more warehouses and more equipment, guess what comes with it? Jobs."
Harville said PNW Vegco's anticipated employment at the Brooks plant is around 600 jobs, 300 more than were there previously.
Marion County is the first county to implement this type of program.
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