appreciation for what AcelorMittal brings to the town, the Burns Harbor Town
Council honored the steelmaking facility’s request for a ten-year tax
abatement for a major rebuild of its “power house.”
Zlajic and Carl Pfeifer said the investment would be $80 million for phase A
over two years. The phase consists of rehabilitating four boilers, two of
the turbine generators, one turbo blower and a reverse osmosis water
The power house
creates steam energy for the plant and the goal is to improve the
reliability of equipment, Pfeifer said.
The project won’t
add any permanent jobs or salaries, Pfeifer said, but local construction
firms will be hired for the work. The plant intends to keep its number of
employees at 650.
The abatement would
start once after the project is complete in October 2018, in time for the
2019 pay 2020 assessment year. The equipment’s assessed value is said to be
For the first three
years, the abatement would be 100 percent, 75 percent for years four and
five, and 50 percent for the final five years.
Making the motion
to approve the abatement was Town Council member Eric Hull, who was
appreciative of the role the plant plays in the town and was happy to assist
“I’m glad to see
you are able to talk to us. Please let us know if there ever is something
else we can help you with,” Hull told the ArcelorMittal representatives in
All Council members
voted in favor of Hull’s motion.
This is the second
tax abatement granted to ArcelorMittal in the last two years. The previous
Town Council in April 2015 voted 4-0 in favor of a ten-year abatement on
three different projects -- a stacker reclaimer replacement, a rebuild of
the No. 12 boiler and a caster mold rehabilitation -- totaling $51 million
in new investments.
In another matter
involving abatements Wednesday, the Council voted unanimously to accept
Indiana Flame Services’ most recent compliance form for its five-year
abatement, although the number of employees is less than the company said it
would try maintain.
IFS was awarded an
abatement in 2013 when it estimated that the company would retain 42
employees with an increase of $203,000 in wages for the five-year period.
The Council saw the
numbers at its meeting last month with IFS reporting it had 36 employees and
tabled the compliance form until IFS could explain the discrepancy.
company on Wednesday, Jim Derkos indicated the drop in employees is due to
an unanticipated slowdown in production. The company, which specializes in
steelmaking, has had fewer tons in scarfing, cutting and slitting compared
to the numbers in 2012 and 2013. The decrease began in 2014 and is still in
IFS employed 42
workers in 2013, 44 in 2014, 37 in 2015 and 36 in 2016.
Derkos said however
that even though the average number of tons processed by each employee has
diminished, the company has managed to increase the average salary, from
$54,755 in 2012 to $57,904 in 2016.
“We tried to keep
up our production but we couldn’t handle 42 full-time employees. We don’t
know what production will be in the next few years,” he said.
Seeing that the
average employee salary has risen despite the drop in production, the
Council agreed to pass IFS’ abatement along for another year.
Hull said he didn’t
feel it was necessary to deny the abatement when IFS is doing what they can
The Council put in
place a resolution that requires businesses with abatements to submit
compliance forms to the Town first and require that the Council President
sign them before they go to the County Assessor and Auditor offices.
In addition to the
two abatement resolutions, the Council passed 5-0 an ordinance amending text
in the ordinance structuring the Town’s Redevelopment Commission.
Changes in the
state law now make it permissible for school boards to appoint a citizen to
the commission that does not have to be a school board member and that
language will be included in Burns Harbor’s ordinance. Also, all members
will be appointed to one-year terms.