Incentives agreement approved for fencing manufacturer

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Incentives agreement approved for fencing manufacturer

Thu, 05/16/2019 - 08:19
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by JULIE B. MAGLIO

This article corresponds the the following agenda item of the April 23, 2019 Board of County Commissioners meeting:

ECONOMIC DEVELOPMENT MANAGER VALERIE PIANTA
Economic Development Incentives Agreement With Delamere Industries, Inc. Delamere Industries, Inc. (DII) dba Elite Fence and DOT Aluminum Rail is a premier fabricator, provider and installer of commercial, residential and DOT fencing and rail products, primarily throughout Florida.

Delamere, dba Elite Fence, a fence manufacturing company currently based out of Pasco County, made an offer to purchase the Monster Transmission facility located at 19370 Oliver Street within the city of Brooksville.  Monster Transmission recently constructed a new facility on Ayers Road.  While Monster Transmission owns the building, the 3.29 acre property is owned by the county. With the sale of the property, Valerie Pianta explained that the property would continue to be zoned as agricultural.

Information about Delamere and the county’s proposed incentive offer appears in the April 23, 2019 BOCC agenda packet:

“Due to their consistent growth, DII intends to expand their operation and relocate from Land O’ Lakes, FL to Brooksville. They plan to purchase a 22193 sf facility located at 19370 Oliver Street. While the manufacturing facility is privately owned, it is located on county owned land which is currently under a land lease.

“DII employs 21 workers at their existing location and intends to add an additional 18 employees (over a four-year period) to their new facility. The average wage is $34,435/year which is 100% of the County’s AAW. Capital investment is expected to exceed $1M.
Local incentives proposed are:

“Provide the county-owned, 3.26-acre site at no cost to DII with requirements to create a minimum of 18 new jobs at an AAW of $34,435 or greater over a four-year period. The property was appraised in March 2019 and valued at $36,000.

“All incentives are performance based and require annual documentation. DII will provide annual job creation and wage documentation over a five-year period (2020 - 2024). Additionally, DII will provide an instrument of financial security in the amount of $36,000 for the duration of the agreement.

“Financial Impact: 01771-3620050 budget revenue reduction of $11,510; termination of existing land lease with Thomas Family Enterprises (Monster Transmission).”  

Commissioner Champion was adamant that the property is worth more than $36,000 and he is not very excited about incentive agreements.

“I’m very familiar with Brooksville, since I have two businesses there. The appraisal is inaccurate. There is no way it’s only worth $36,000 especially with a building on it.  The building can’t be removed from our property.  I have a real problem with these incentives in general,” said Champion.

Pianta explained that the appraisal took into account the triangular shape of the lot and a one acre easement.  She remarked that they have been working with this company for a lengthy period of time, prior to the county’s recent changes on policy relating to incentive offers.

“The real incentive is to get out of Pasco, which is a disaster because their taxes are double or triple what ours are,” said Champion.

Pianta said that the company is not looking to lease the property- they would prefer to own it.  She explained,  “It will remain zoned as Ag (agriculture) land through the city… but it will come back on our tax roll immediately.”

Commissioner Champion clarified that they are currently collecting the taxes from the building and they are collecting revenue from a lease. 

Owner of Delamere Industries Inc, Paul Hughes stated that the company has been in operation for over 20 years.  He explained that originally the company now known as Aluma-Guard began manufacturing FDOT handrail - which became part of Elite Fence.  Three years ago Hughes and his wife Nicole purchased the company with 11 employees, now they are at 21.

Currently they have 3600 square feet of shop space and a lot of orders coming in.  They can’t physically manufacture what they need to manufacture in the space they have.  

About 70% of his current workforce is from the Brooksville area.  He said they’ve seen several properties in the area that could meet their needs.  

Hughes remarked, “For our business right now, we are stretching ourselves to make this move.  At this point we do $3.6 million total sales.  We plan to get to $6 or 7 million total sales after we hire another 18 people.” He explained that after they invest in moving the business, property renovation and equipment, “it’s a stretch.”  They are also still carrying the Pasco County property, since it has not sold yet along with a lease in Tampa.  “Every penny counts.” 

The incentives agreement was approved 4-1.
 

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