In a significant turn of events from where they first started, the Truesdale Board of Aldermen voted Dec. 14 to approve a tax abatement deal with beverage maker Refresco. The agreement will allow …
This item is available in full to subscribers.
We have recently launched a new and improved website. To continue reading, you will need to either log into your subscriber account, or purchase a new subscription.
If you are a digital subscriber with an active subscription, or you are a print subscriber who had access to our previous wesbite, then you already have an account here. Just reset your password if you have not yet logged in to your account on this new site.
If you are a current print subscriber and did not have a user account on our previous website, you can set up a free website account by clicking here.
Otherwise, click here to view your options for subscribing.
Please log in to continue |
In a significant turn of events from where they first started, the Truesdale Board of Aldermen voted Dec. 14 to approve a tax abatement deal with beverage maker Refresco. The agreement will allow Refresco to avoid an estimated $607,000 in tax payments on new equipment being purchased by the company.
Refresco is purchasing $22 million in new manufacturing equipment to add an additional production line to its facility in Truesdale, which it acquired from Coca Cola in 2021. Under the agreement with Truesdale, most of the property tax payments for that equipment will be reduced by 50 percent for a set number of years.
The only exceptions are tax payments owed to the Warren County Ambulance District and Warrenton Fire Protection District, which are expected to collect 100 percent of their taxes. This is because Missouri state law gives emergency responder districts the option to opt out of tax abatement agreements — an option that the responder agencies have indicated they will use.
The tax abatement only applies to the new equipment, not to any property Refresco already owns. The agreement with Truesdale will provide a five-year tax abatement for a $10 million chunk of equipment purchased in late 2022, and an equivalent five-year abatement for another $12 million chunk of equipment purchased in 2023 (meaning some portion of the abatements will be in place for a total of six years, from 2023 to 2028).
Tax abatement agreements are often complicated, but the short version is that a local city (or county) government helps a private business reduce the amount of property tax that it owes to all of the public entities within the city’s borders.
In this case, Truesdale is helping reduce what Refresco owes to the city itself, the Warren County R-III School District, the Warren County government, Scenic Regional Library, and two Missouri disability funds.
Since the tax reduction only applies to new equipment being purchased, that means local entities are still receiving a net increase in tax collections; they’re just not receiving as much as they would have without the abatements.
Warren County R-III School District will collect an estimated $450,000 in new property tax revenue from the Refresco expansion over the course of six years, rather than over $900,000 the schools would have collected without the abatement.
The Warren County government will collect an estimated $38,800 in new revenue, instead of $77,600.
Scenic Regional Library District will collect an estimated $20,100 in new revenue, rather than over $40,200.
The city of Truesdale will collect only $91,000 in new property tax income, rather than $182,000.
Missouri state funds for disabled persons and blind persons will collect $16,900 and $3,100, respectively, rather than double those amounts over six years.
The Warren County Ambulance District and Warrenton Fire Protection District, meanwhile, are both expected to collect the full value of their property taxes from the Refresco expansion. That’s expected to bring in $104,000 for ambulance and about $95,000 for fire services over the next six years.
In exchange for Truesdale’s help in saving $607,000 in taxes, Refresco has to comply with a requirement that the company put that economic benefit back into the community by increasing its Truesdale staff by 30 employees.
The company anticipates those 30 new employees will have an average salary of around $44,000.
Refresco will be required to provide annual reporting to show that the number of employees at the plant is at least 30 more than at the end of 2022. Failure to sustain those jobs, failure to provide required documentation, or any falsification on their reporting could all cause Refresco’s tax abatements to be canceled, according to the agreement with Truesdale.
One other slight complication to Truesdale’s consideration of the tax plan was a request from Julie Schaumberg, collector of revenue for Warren County. Schaumberg asked Truesdale to change the structure of the agreement to make it easier to predict the amount of money Refresco owes each year by setting all the payments now, rather than using annual assessments.
Aldermen declined that request, saying they had already pushed a decision on the tax abatement to the deadline for Refresco to take advantage of it for new equipment that will become taxable on Jan. 1, 2023. Any change to the agreement would have required renegotiation with the company.
