COUNCIL PROCEEDINGS

JUNE 11, 2001

ATTICA, INDIANA

The Common Council for the City of Attica met on the 11th day of June 2001 at the hour of 7 p.m. at city hall. Those present: Mr. Larry Grant, Mr. Curt Phelps, Mrs. Valerie Maus, Mrs. Kay Gustus, Mr. Bill Craft, Mr. Tom O'Connor, Mr. Deon Swift, and Mrs. Nancy Mitchell.

APPROVAL OF THE MINUTES

Minutes of the previous meeting were approved on a motion by Mrs. Gustus, seconded by Mrs. Maus.

COMMITTEE REPORTS

Mr. Larry Grant, Chairperson of the Zoning and Planning Commission, reported that the committee met May 31, 2001 but a quorum was not present for voting, therefore, they would have to set another date.

CITIZENS PETITIONS

Mr. Mark Alexander, of BKD, an accounting firm representing Harrison Steel Castings Company, presented a petition for a tax abatement of $9.1 million for modernization to the plant. Present with Mr. Alexander were Mr. Robert Harrison, Mr. Geoff Curtis, and Mr. David Banta.

Mr. Alexander stated that Harrison Steel would like to break ground this July, with a completion date of December 2002. They will be installing an automated molding line. Management feels it is necessary to modernize now or they won't be competitive in the future steel market. This particular project does not create jobs, but will actually eliminate some. They will try to eliminate as few jobs as possible and will attempt to transfer employees to other areas within the plant in order to save jobs. It is estimated that approximately 67 jobs will be lost, but modernization will help secure jobs of the remaining 599 employees.

Mr. Harrison stated that Harrison Steel is looking at investing in an automated line that will replace all the green sand molding. The reason for making this investment is that it's going to give them fewer variations; they'll be able to make higher tolerances, cleaner castings. In terms of the work force, the new line will be more ergonomically sound. For the past few years, they have had a turn over of 60% to 120% in this department. Harrison's major customer, Caterpillar, has requested a 3.5% decrease per year in cost for the next three years. He feels that "this will keep us here and make a stronger foundry". Mr. Alexander said that over the next ten years addition investments of $1 million per year are expected for which no abatement is being requested. Estimates are, that with abatement, property taxes paid by the company in 2002 will be the same as this year's taxes and payments will increase drastically over the next ten years, even with abatement. In the end, the year 2011, the year before the abatement drops off, the tax liability will actually increases from about $485,000 to approximately $640,000, even with the abatement in place. The numbers do not include the country club or housing operations, only the foundry .The construction would take place at the south end of the plant where the sand mill and shakeout bay is located. Mr. Phelps asked, "If the success rate in the market increases, could those jobs ever come back? Mr. Curtis replied, "Yes, but not in the foundry, more likely in the cleaning room". Mr. Phelps asked, " Are the lost jobs through attrition"? Mr. Curtis stated, "Mainly through attrition, particularly since this is a high turnover area of the plant already". Mr. Phelps was also concerned about the environmental impact.

Mr. Banta said they would be replacing the 1940's technology with modern technology, which would bring an overall improvement to the environment. Mr. Grant was concerned what impact this is going to have on the city's revenues. Mr. Alexander said that currently Harrison Steel pays between $480,000 and $490,000 in property taxes yearly. Mr. O'Connor explained that the purpose of the tax abatement is to abate the additional tax on new equipment or development of real estate; that we're not reducing tax liability, we're just not going to tax for a period up to ten years. Mr. Phelps wanted to know, "What would be the estimated company life span if they didn't make this investment to stay competitive". Mr. Harrison said, "For the most part, the impression they were getting from their customers is that they are wanting to work with developing countries and developing technology to take advantage of the lower labor rates". Mr. Grant made a motion to adopt Resolution # 1, A Resolution of the Common Council for the City of Attica Declaring Certain Real Estate Within the City of Attica and Economic Revitalization Area, seconded by Mrs. Gustus. All ayes. Roll was called, five ayes, no nays.

DEPARTMENT HEADS

Mr. Smith reported that the yellows lines would be painted in the three block downtown area from the highway to Ferry Street.

Police Chief Snoeberger said that in the past month 27 vehicles had been tagged and seven towed away where the citizens did not comply. He felt there had been cooperation and can see an improvement in the properties.

Mr. Snoeberger also stated he had sent letters to resident and property owners in Elmdale explaining to them the ordinances concerning weeds and junk vehicles. He is giving them a couple of weeks to cleanup their property.

Mr. Snoeberger said The Cops in Schoo12001 Grant deadline was June 5, which had passed. The committee recommends seeking private donations

for at least part of that funding; thus far they had received $450. The money will still go toward school presentations beginning this fall.

UNFINISHED BUSINESS

Mr. Phelps made a motion to bring Ordinance #7 from the table and read for the third time, seconded by Mrs. Gustus. Mr. O'Connor read:

ORDINANCE #7, 2001, AN ORDINANCE AMENDING CHAPTER 9, ARTICLE 6, WATER WORKS RATES AND CHARGES. Mr. Phelps made a motion to adopt Ordinance #7, seconded by Mrs. Gustus. Roll was called. Five yeas, no nays.

NEW BUSINESS

Mayor Swift invited all council members to attend a meeting in ,his office on Wednesday, June 13, 8:30 a.m. with Eric Smith, of Hannum, Wagle & Cline.

ADJOURNMENT

There being no further business to be brought before the council, the motion to adjourn was made by Mrs. Gustus, seconded by Mr. Phelps. All ayes.