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It's not unusual for companies to seek tax breaks on growth while working to lower value of their property

Abatement could save Edy's $1.4 million on $18 million investment, but company wants more

Tuesday, August 19, 2014 - 12:01 am

At first, City Councilman Russ Jehl suspected it might be a case of attempting to "double dip" at taxpayers' expense.

But, in fact, there's nothing sinister – or even all that unusual – about a company seeking a tax break on new investment at the same time it is trying to lower the taxable value of the facility being improved.

Edy's, which makes ice cream at its plant at 3426 Wells St., is doing both. Next month City Council will consider granting an abatement that would save the company $1.4 million in taxes over 10 years on $18 million in new equipment and other improvements to the facility. At the same time, the company is also appealing the value placed upon the plant by the Allen County assessor's office.

The county assessed the plant at about $10.2 million last year, generating nearly $311,000 in taxes. The company claims the plant is worth just $3.87 million.

"Assessors don't work in the economic development arena, My job is to be fair, to base values on comparable properties," said Assessor Stacey O'Day, whose office based its assessment sale prices for similar properties in Indiana. "I'm very confident we were fair and accurate (in our figure)," she added.

But O'Day said Edy's and other companies that have filed for both abatements and assessment appeals are not "double dipping," since abatements lower taxes based upon official values, not the value sought through an appeal. Edy's has appealed the value of its Wells Street plant for the past four years, and if it ultimately prevails it will have to repay taxes saved through abatements based upon the higher assessment.

"Abatements are a non-factor in appeals," she said, noting that at least 100 other companies have sought both abatements and lower assessments in recent years.

Perhaps the most significant example of that has been Allen County's General Motors truck plant, which has received numerous abatements on millions of dollars in improvements since its construction in the mid-1980s. Just last year, in fact, the county and GM settled an assessment appeal that had lingered for years. In 2006 the company claimed the plant was worth $48 million, but lowered that to $35 million in 2012 despite $276 million in improvements since 1985. O'Day's office had assessed the plant at $101 million in 2007 but lowered the value to $74.9 million in 2012.

"I'm still trying to see whether (City Council) should be interested (in companies seeking both tax appeals and abatements), said Jehl, adding that he is satisfied there is no "double dipping" going on.

Edy's says the abatement will help retain 542 full-time jobs in Fort Wayne, with an average salary of $47,120. The company has received abatements on numerous expansions over the years, resulting in expansion of a workforce that numbered 102 in 1993.