Archive for Thursday, April 20, 2000

Council continues action to bring company to Eudora

April 20, 2000

Eudora inched closer to bringing Royal Tractor Inc. into its business fold with the application of a Community Development Block Grant.

Royal is currently located in New Century and manufactures heavy industry machinery for use in airplane and automobile construction. The company wants to move its operation to 12 acres at Intech Business Park and wants the city to apply for a grant to aid its move and construction of a new building. The lease for the company's current location has ended and it is now looking for a new home.

Before any action was taken on the grant application, council member Dan Gregg voiced concerns about the longevity of the company's presence in Eudora at the city council's April 12 pubic hearing.

"My concern is, that when the 10-year abatement is up, you pack your toys and move on somewhere else," Gregg said.

T.J. Hardwick, president of Royal, expressed his desire to stay in Kansas and Douglas County and that he would like to make Eudora the company's next home.

"This is my home," he replied.

The council decided to approve applying for the grant, which is federally funded and then allocated through the state. If awarded, the state would award $750,000 to Royal, who will then repay the grant to the city and then back to the state.

The grant was to be filed by April 15 with the recipient to be awarded June 1.

In addition to the grant, Royal is proposing a 75 percent tax abatement for 10 1/2 years. At the March 27 meeting, city attorney Gerry Cooley advised the council the city's current policy is that no abatement is to exceed 50 percent over a 10-year period.

While no action was taken on the abatement issue, Ray Barmby, financial consultant for Royal, said the company would like to know where the city stood on the issue.

"What I'd like to see is some expression tonight as to which way you'll go towards the tax abatement," said Ray Barmby, financial consultant for Royal. "A purpose of the tax abatement is to compete now."

Barmby said while Eudora is the primary possible site for Royal the company also has offers from other cities. A 75 percent tax abatement, he said, would act as the city saying, "We'll help you out."

"It's a way to compete and still be in the game," Barmby said.

Gregg voiced his stance on changing the policy of 50 percent abatement.

"I'm not shy," Gregg said, "the city has a policy of 50 percent, and I'm not willing to vote over 50 percent."

Even though the city has applied for the grant, the tax abatement is still an issue Barmby said. And while the company wants to move to Eudora, it must take that into consideration. Barmby said the company needs to know soon what the city proposes on the issue, hopefully before the grant is awarded.

The city will discuss the abatement in future meetings with a possible public hearing.

"Somewhere between now and then we need to know what sort of incentive is going to be offered by the city of Eudora," Barmby said. "Basically, you've got a this or that request from the company. He (Hardwick) has to weigh what is offered in Eudora, versus what is offered elsewhere."

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