The city’s elected officials were unanimous in granting a tax break of up to $924,577 to JENNMAR Canada during Tuesday’s finance and administration committee meeting.
The tax break, spread out over the course of five years, is targeted to help with the mining supply company’s major upgrade of a manufacturing facility at 2291 Lasalle Blvd.
Although approved on Tuesday, the decision to approve still needs to be ratified by city council as a whole during their next city council meeting on Oct. 21. Since city council is composed of the same 13 people as the finance committee that unanimously approved the decision on Tuesday, it’s likely to pass.
“This is a really exciting one,” city Economic Development director Meredith Armstrong told city council members during Tuesday’s meeting, noting that it’ll help shift value-added steel manufacturing jobs from the United States to Sudbury.
Under a tax increment equivalent grant, the difference between taxes levied using a property’s assessed value both pre- and post-development are rebated to the owner for a set number of years.
In this case, a rebate of $184,915 per year was approved over five years for a maximum approved grant of $924,577. This is an estimate, with the final total depending on what the Municipal Property Assessment Corporation determines the property’s value to be post-development.
(The property, assessed at just greater than $2 million, pays $98,000 in taxes currently, and will be assessed at approximately $5.2 million when the upgrades are complete, at which time their new tax levy will be approximately $283,000.)
The JENNMAR expansion was announced earlier this year, and is making use of a $19.4-million municipal water/wastewater infrastructure upgrade in the area to help shore up industrial lands.
The expansion is slated to add 693 square metres to an existing industrial building of more than 2,700 square metres.
A municipal report notes that the expansion’s total upgrade cost is approximately $7 million, plus an additional $5.6 million on operational spending via such things as wages and utilities.
“The economic impact of this project also includes the creation of 21.42 additional full-time-equivalent positions as verified by staff,” according to the report. “In addition, required inputs will significantly increase the demand of products and services from local suppliers.”
JENNMAR has operated in Sudbury since June 2020, since which time they’ve grown to a current staffing complement of approximately 40.
The current situation with U.S. tariffs made now the right time to expand, company managing director David Hurd told Northern Ontario Business earlier this year.
“It’s just pushed us a little bit faster than we would have liked to go,” he said at the time, noting that the shop is able to manufacture components in Sudbury, using Canadian steel. Approximately 1,000 tonnes of steel now moves in and out of the facility each month.
The expansion will help shift roll-forming and welding production lines from JENNMAR’s plant in Pennsylvania to Greater Sudbury, for Canadian customers, as well as help them expand products and services to international clients.
Tyler Clarke covers city hall and political affairs for Sudbury.com.