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6.2 Ad Valorem Application CITY OF SALINA REQUEST FOR COMMISSION ACTION DATE TIME 2"~T~/1993 ~:oo P.l~. AGENDA SECTION: Consent ORIGINATING DEPARTMENT: API~ROVED FOR NO. 6 City Clerk AGENDA: ITEM NO. J.B. Shiever, CMC 2 BY: BY: An application for tax exemption has been filed by Salina Vortex Corl~oration, 3024 Arnold Avenue. Recommended action Set the date of February 22, 1993 for public hearing. COMMISSION ACTION MOTION BY SECOND BY TO: SALINA VORTEX' CORP. 3024 Arnold Avenue / Salina, Kansas 67401 ® Telephone (913) 825-7177 January 27, 1993 Board of City Commissioners 300 W. Ash Salina, Kansas 67401 Board of City Commissioners: We respectfully request your consideration for a tax exemption per city policy for our proposed plant expansion at 3024 Arnold Ave. A tax exemption will allow us to Justify adding to the current facilities at this time. We believe we meet all criteria for granting the tax exemption under Section Four of Resolution Number 91-4265. The planned expansion should generate eight new jobs as detailed herein. Salina Vortex was established in 1978 at this location and has steadily grown since its inception. The planned building expansion will add on to and improve a building currently owned by the Salina Airport Authority. Your consideration of this request will be appreciated. C:TY OF SALINA, KANSAS APPLICATION FOR PROPERTY TAX EXE~.PTION FILE~ [. APPLICANT TNFORMATION '92FEB i 2 02 1. Applicant Business Name ana Adoress: CiTY C? S;',LINA, KS SALINA VORTEX CORPORATION 3024 ARNOLD AVE. SALINA, KS 67&-4t1~ el F~;~'S OFF!CE Note: Attach the name and address of principal uwners and officers of the business. ° Name, address and telephone number of person to contact in regards to this application: LEE YOUNG 3024 ARNOLD AVE. SALINA, KS G7401 {913) 825-7177 II. BUSINESS iNFORMATION !. Type and nature of applicant's business: DESIGNER & MANUFACTURER OF GATE VALVES & DIVERTER VALVES FOR FLOW CONTROL OF DRY BULK MATERIALS SUCH AS GRAIN, FOODSTUFFS, FIBERS, CHEMICALS, PLASTICS AND MINERALS. Note: Attach ~ general description ur-business history and experience. 2. Is this a new business or an expansion of an existing business? EXPANSION OF AN EXISTING BUSINESS 3. Principal competition in local market: THERE IS NO COMPETITION IN LOCAL MARKET. SALINA VORTEX IS A SUPPLIER TO LOCAL FIRMS SUCH AS PREMIER PNEUMATICS, CORONADO ENGINEERING, ECONO-FLO/ADM. III. PROJECT INFORMATION 1. Location of the proposed project: 3024 ARNOLD AVE.- ADDITION TO EXTEND SOUTH OF CURRENT FACILITY. 2. Name and address of the owner of the land and building occupied or to be occupied by the business: LAND & EXISTING FACILITY IS OWNED BY THE SALINA AIRPORT AUTHORITY. NEW FACILITY- WILL BE OWNED BY SALINA VORTEX CORPORATION. 3. General description of proposed project: 5,000 SQUARE FEET OF OFFICE AREA ON TWO FLOORS 14,000 SQUARE FEET OF MANUFACTURING SPACE Note: Attach a site plan showing existing anU proposed buildings and improvements. (~E£ ATTA(~NT) 4. Estimatea capita: cost of project: S 275,000 (Buildings and [mp~ayements) S 100,000 (Machinery and Ecuipment) 5. Rumber of existing (full-time equivalent) employees: SEE ATTACHHENT Note: [f an existing business, attach the average total monthly employment figures for the past twelve months. 6. Number of new (full-time equivalent) jobs to be created: 8 JOBS Note: Attach a l~sting of the number and type of new jobs to be created. (SEE Al-rACHH£NT) IV. TAX EXEMPT!ON INFORMATION 1. Amount or percentage of tax exemption requested: 50~ OR AS ALLOW£D BY GOVERNING POLICY 2. Why tax exemption is being requested: (SEE ATTACHHENT) Note: Attach a supporting statement explaining why the requested tax exemption is a critical factor in determining whether the proposed project is to be completed. V. APPLICANT CERTIFICATION I certify that the above information and statements are true and correct to the best of my knowledge and belief. I understand that this information will be available for public inspection under the Kansas Open Records Act. ! further understand that failure to produce the stated economic benefits may result in a reduction or loss of tax exemption. Furthermore, I certify that the requested tax exemption is a critical factor in the achievement of the statej~conomic benefits location or expansion. · Date / / (Jan. 1990) SALINA VORTEX* CORP. 3024 Arnold Avenue I Salina, Kansas 67401 ® Telephone (913) 825-7177 I. APPLICANT INFORMATION Principle Owners: John Peterson 1308 Kingston Salina, Kansas 67401 Mike Peterson 2665 Ra~ Sallna, Kansas 67401 Lee Young 3324 South Simpson Road Salina, Kansas 67401 SALINA VORTEX* CORP. 3024 Arnold Avenue / Salina, Kansas 67401 ® Telephone (913) 825-7177 Il. BUSINESS INFORMATION COMPANY HISTORY: Salina Vortex Corp. was established in 1978 at the current location by Nell Peterson and Lee Young. Mr. Peterson, now semi retired, remains Chairman of the Board and provides product development and financial services for the company. The company specializes in the design, manufacturing and marketing of gate valves and diverters valves for controlling flow of dry bulk materials. The company has two patents protecting multiple product designs with a patent pending for a new product. The products are specifically designed for gravity flow applications and for differential pressure conveying service up to 15 PSIG. The products are marketed world wide with the United States and Canada as the major markets. The primary customers are "Fortune 500" companies such as Dow, General Foods, Pillsbury, Kimberly Clark, Monsanto, Quaker Oats and General Electric Plastics with over 99% of the sales revenue coming from outside the state of Kansas. Over the past four years the company has grown over 300% with current facilities becoming inadequate for continued growth. Three new products are being developed to serve a broader customer base which include an all stainless steel sanitary gate, a sanitary diverter valve and a manual maintenance gate. Company growth is expected to continue at a reduced rate with existing product lines at or near maximum domestic market penetration with new products the primary catalyst for growth. The current management team has over 100 years of combined experience in the dry bulk material handling. The owners of the business are active in the day-to-day operation of the business. The proposed expansion is expected to add 10-15 Jobs over a five year period adding $400,000-$500,000 to the current annual payout of $700,000. SAUNA VORTEX® CORP. 3024 Arnold Avenue / Salina, Kansas 67401 ® Telephone (913) 825-7177 III. PROJECT INFORMATION PROPOSED BUILDING AND IMPROVEMENTS The attached site plan details the proposed expansion including the existing facility. The $000 square foot office area, on two floors, will provide additional administrative offices, a conference room, handicap accessible rest room facilities, file storage and a combination lunch/meeting room. The 14,000 square foot manufacturing facility is to have dock high truck unloading as well as drive-in flat bed truck unloading, additional restrooms, dust control rooms and product wash down areas. The existing facilities will be incorporated into the new facility by extending the roof from the new building over the current building and by installing matching siding and windows. The metal building to the north, now occupied by Waddle's Manufacturing, is to be extended to the east by 16 feet adding 640 square feet. The existing buildings are to be incorporated into the new building so as to be indistinguishable from the new facility. The design of the new facility will easily permit future expansion as required with adequate parking and street access. JOBS TO BE CREATED The Jobs to be created within 18 months of project completion are planned as follows: Number of Jobs Position I ....... Tig welder 2 ....... Metal fabricator 2 ....... Product assembler/parts manufacturing technician I ....... Sales/Customer services assistant I ....... Administrative secretary I ....... Purchasing assistant 8 Full time Positions SALINA VORTEX' CORP. 3024 Arnold Avenue / Salina, Kansas 67401 ® Telephone (913) 825-7177 III. PROJECT INFORMATION 1992 Full Time Equivalents January ..... 19.65 February .... 19.28 March ........ 19.46 April ........ 19.28 May .......... 19.85 June ......... 19.38 July ......... 19.81 August ....... 19.44 8eptembe~ .... 19,23 October ...... 19.23 November ..... 19.97 December ..... 19.93 Total ...... 235.51 Monthly average... 19.62 FTEs ADDITION 640 S.F. ....... ~ -- -~.oo' , 2,400 S.F. EXIST~NG BLDG ~7 ~. NEW pROPOSED ADDITIO~ ~' ' PA~KINO 1.6,300 'S F. . . o I (2-K) INDUSTRIAL USE ~-" :i~/ 1 STALL PER 3 EMPLOYEES (30) EMPLOYEES MAX. · . P~KmO L~ Il NEW ADDITIONAL ~ s~ I AREA = .755 ACRES I SAUNA VORTEX' CORP. 3024 Arnold Avenue I Salina, Kansas 67401 ® Telel~hone (913) 825-7177 IV. TAX EXEMPTION INFORMATION TAX EXEMPTION REQUEST The growth of the company has made the existing facilities inadequate for future expansion and a safe work environment. The proposed facility is a major financial commitment for Salina Vortex. No large long term contracts or orders are anticipated to finance the expansion only slow steady growth based upon the introduction of the aforementioned new products, which also require a major financial commitment. The expansion requires the company to make a substantial investment without a guarantee of return in an uncertain economic environment. Financial incentives, in the way of property tax relief, are required to Justify the near term expansion and proposed improvements to existing buildings.