Danville panel OKs incentive to retain Steel Grip
Deal has city giving back up to $250,000 in property-tax revenue to keep business from moving to Indiana
DANVILLE — Aldermen agreed Tuesday night to return up to $250,000 in property-tax revenue to Steel Grip to help the local company and its 100 employees relocate to a new facility in Danville, rather than moving the operation to Indiana where it already has two other facilities.
"This is a retention situation," said Vicki Haugen, president and chief executive officer of Vermilion Advantage, which has been working with the owners of Steel Grip for about two years to help them find a new location for their Danville operation.
The current facility is housed in two buildings on Griffin Street that are more than 100 years old and inefficient. The company plans to move to a larger, more modern vacant building at 1501 E. Voorhees St., the former site of Smurfit-Stone, which closed in 2006.
Steel Grip, established in 1985, manufactures protective apparel for various industries. The private company with Indiana-based owners has locations in Danville and in Covington and Kingman, Ind., and employs 200 people total, Haugen said.
The Voorhees Street location sits within the city's newest tax-increment-financing district.
Once a TIF district is created, it allows the city to divert all new property-tax revenue generated inside to a single fund and reinvest that money in various ways within the district. The intent is to spur economic development.
This would be the first commitment of future TIF-district funds within this new district, which runs along the Voorhees Street industrial corridor generally from Bowman Avenue to Michigan Avenue, including the former Heatcraft and Hyster buildings and current companies like Quaker Oats and Genpact.
Under the proposed TIF-district agreement approved by the city council's public-works committee Tuesday night, the city would return each year some of the property taxes that Steel Grip will pay into the city's TIF fund. The total returned over the 20-year life of the TIF will not exceed $250,000.
Separate from the TIF-district agreement, the city is also giving Steel Grip $350,000 in federal grant money toward the $600,000 purchase price of the Voorhees Street building.
Aldermen Bill Black, Ward 7, asked whether Steel Grip already owns the Voorhees Street building. He said he checked county documents showing that the building was bought last month and questioned the purchase of the building then when it's going to be sold to Steel Grip soon.
Haugen said Steel Grip does not own the building now but will be buying it for $600,000 from an unknown investor who stepped in, in the interest of retaining the business, to buy the property from the out-of-state owners and immediately sell it to Steel Grip "for no profit." Haugen said she is not privy to the identity of the investors who bought the property last month.
The TIF-district agreement will now go to the full city council next week for final approval. Black was the only alderman on the public-works committee who voted no.