April 16, 2014 - Two new developments have occurred regarding the fate of the 98 S. Glaspie St. property owned by Oxford Village.
Last week, the village council voted 3-2 to create an industrial facilities tax (IFT) exemption district for the site and Raven Engineering, Inc., one of the parties interested in buying the property, withdrew its previous $250,000 offer.
Purchased by the village for $700,000 in March 2006, 98 S. Glaspie St. is a former industrial site consisting of two parcels totalling approximately 3.5 acres and a building that's approximately 22,000 square feet in size.
The village recently had the property appraised and it's now valued at $305,000.
The creation of an IFT tax exemption district gives the village the ability to grant a tax abatement to whoever buys it, if one is requested and if council chooses to grant it.
Establishment of the district doesn't automatically guarantee a tax abatement will be given.
"You are simply taking the raw land and laying a district over it," explained village attorney Bob Davis as addressed council. "You are not approving any candidate or any tax abatement . . . You have a formula that governs that and you have total discretion to approve or deny tax abatement requests."
Davis noted having the district "serves as an enticement for potential discussions with (companies) who may want to relocate to your community."
Some council members took the opportunity to once again voice their personal opposition to tax abatements.
"Again, I would like to make it very clear I'm not pro-abatements," said Councilman Elgin Nichols.
However, Nichols noted creating the IFT tax exemption district and having the ability to offer abatements puts the village in a much stronger bargaining position to get more money for the property.
"It's just an additional tool," he said. "It is a negotiating point . . . The residents deserve to get as much money out of that (property) as they can. They've already lost a lot of money (through) the purchase. We all know that story."
Councilman Bryan Cloutier noted he, too, is opposed to tax abatements. "I'm inclined to not even set up the district myself," he said.
Both Cloutier and Councilwoman Maureen Helmuth voted against the district's creation.
The village is down to one interested buyer for 98 S. Glaspie St.
Raven Engineering, currently located at 300 Adventure Lane in Oxford Township, withdrew its $250,000 offer for the site.
Robert Corbin, president of Raven Engineering, explained the time needed to finalize a purchase agreement with the village and "do the massive renovations that would be required" for the building at 98 S. Glaspie St. "exceeded" the time frame in which the company needs to have a new place.
"We're busting out at the seams at this point in time and just needed more space in a sooner time (frame)," he said. "We just had to go in a different direction and try to get some space sooner."
Raven is pursuing a new property.
"We're in the final stages of a lease agreement and we're still hoping to stay within Oxford," Corbin said. "We're still committed to the community, that's for sure. That hasn't changed at all. But our business needs our sooner (rather) than later at this point."
Puritan Magnetics, Inc., a magnetic equipment manufacturer located at 900 S. Glaspie St., is still pursuing the village property.
Back in February, Puritan submitted a letter of intent offering $300,000 for the property and requesting a 10-year tax abatement "in exchange for (the company's) investment and improvements to the deteriorated premises."
The building at 98 S. Glaspie St. is in very poor condition and would require a significant investment of funds just to bring it up to code let alone make it suitable for a particular company's needs and uses.
Al Crawshaw, president and co-owner of Puritan Magnetics, told this reporter they would be willing to bump up their offer to $305,000 to match the village's appraisal.
"That's not a problem," he said.
But Crawshaw is not sure about going any higher.
"Any more than that, we don't know," he said. "We've got to discuss it internally here and see what our options are."
"Based on that appraisal, I don't why I would pay any more than that," Crawshaw noted. "(Councilman) Elgin (Nichols) threw out a number of $500,000, but that's just not going to happen."
Nichols, along with Davis and village Manager Joe Young, have been negotiating with Puritan on the municipality's behalf.
The big issue for Puritan is financing, according to Crawshaw.
"Although we have an appraisal (for) $305,000, if we put $300,000 or $400,000 into it, then it's going to have to appraise out at $600,000 or $700,000 to be able to secure financing," he explained. "That's where we run into problems."
"We've got to do some research. It may not appraise out (where we need it to) after we put the money into it and the bank won't lend us the money if that's the case," Crawshaw said.
CJ Carnacchio is editor for The Oxford Leader. He lives in the Village of Oxford with his wife Connie and daughter Larissa. When he's not busy working on the newspaper, he enjoys cigars/pipes, Martinis/Scotch, hunting and fishing.