Local car-part manufacturing plant asks county for tax break

Dana Light Axle Products hopes to add about 135 local jobs in Columbia if the county approves a 50 percent tax abatement on a $39 million project to upgrade its equipment.

The company employed 400 people when it first opened. Now it only employs 89.

Dave Griggs is the secretary of Regional Economic Development Inc. or REDI. He’s also the chairman of the REDI incentives subcommittee, which is working on securing this project for the community.

“It’s 135 new jobs that are fully benefited,” he said. “There’s opportunity for overtime and bonuses, with a company we have a long-standing track record with.”

The company would retain most of the 89 original jobs while adding the new ones, should the Boone County Commission approve the proposal.

Dana would pay for the upgrades with Chapter 100 bonds, meaning the county leases the equipment until it can pay off the loan with the bonds.

Griggs said he worked for three years with REDI to bring the Chapter 100 program to Boone County. He said the county was overlooked for big projects because it didn’t have an incentive program for companies coming in.

The abatement will be on personal property taxes so there are several local entities that would be affected, including Columbia Public Schools, the city, Boone County Family Resources, Boone County Library, and BC Road and Bridge.

Griggs said the abatement period would be about seven years. During that time, CPS would gain about $1.2 million in revenue, the city would receive about $82,000 and the Boone County library would see about $82,000 in revenue gains.

Based on the depreciation of the new equipment and equipment bought during that time that wouldn’t be part of the abatement, Griggs said the numbers are approximate.

The Columbia Public Schools board agreed unanimously Monday night to support the proposal.

“This is new growth that was unexpected, it wasn’t in our long-range plan to get this new revenue from Dana Corp.,” said Linda Quinley, CFO for Columbia Public Schools. “It’s really a bonus that will help us long term sustain our tax base at an advantage to our taxpayers.”

Unique to Boone County’s Chapter 100 program is that the taxing entities are included in the decision to approve a proposal. Depending on the project’s location and tax abatement, different agencies are affected.

Griggs said having the agencies directly involved in the process and letting them know the details of the project has a double advantage.

“It’s a process designed to protect the interests of the taxing entities,” he said.

While the Boone County Commission makes the final decision, the taxing entities are able to voice support or not. Griggs said this helps the commission make a decision.

The company has several dozen locations throughout the country and it’s possible it would take the upgrades to another city should the proposal not be approved in Boone County.

“The odds are our employment level is going to decline and our investment level is going to decline,” said Griggs. “Not only is there gain by doing this, we’re also preventing future loss.”

The Chapter 100 committee will meet Aug. 18 to ask the entities to vote whether to recommend the proposal to the Boone County Commission.