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Pending Signing of MOU, Printpack Tax Abatement Granted

By Regan McCarthy

Posted October 7, 2009

Monroe County Council members granted Printpack a 10-year tax abatement Tuesday to relocate from their current site in Bloomington to the county.

Over the past few months, Printpack has been trying to have its new building in a Tax Increment Finance district and get an abatement, too. And now they will, but it won't be an abatement as usual.

This is the first time an abatement has come with the stipulation that the receiving company will sign a memorandum of understanding. Monroe County Council President Vic Kelson said he doesn't think that will be a problem.

"Printpack's attorney was involved with our legal staff intensely this week in the development of the MOU so it is our presumption that the MOU will be approved by Printpack's management and that we'll move along," Kelson said.

But, of course, the actual abatement won't kick in until the building is finished and the county assessor determines the total value of the property. The MOU clarifies mutual responsibilities held between the business and the county spelling out such things as the number of positions Printpack will be expected to keep filled without penalty.

The document also spells out the specific ways in which any failure to comply with the agreement will be handled in an effort to address public and council concerns that despite the fact that an abatement typically comes with certain responsibilities, compliance is often very difficult to enforce.

Council Attorney Michael Flory said any breech in the contract during a specific year would require Printpack to fully reimburse any taxes abated that year. If the plant were to close, keep fewer than 75 workers in the Monroe County building at any time during the next decade, Printpack would be asked to repay the full abatement.

"The amount that they would pay back  is capped at the total amount of the value of the tax abatement that they have received so you would tally that up and if they've paid anything that would be deducted from the payment amount," Flory said.

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