Government and Manufacturing

City approves tool-and-die recovery applications

November 17, 2012
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The local tool-and-die industry last week got the attention of Grand Rapids city commissioners, who approved applications to let six firms join the Tool and Die Renaissance Recovery Zone and collect the appropriate tax breaks.

Five of the six are located on the city’s northeast side and all six are affiliated with the same tooling group.

Advanced Tooling Systems, Concept Tooling Systems, 3-DM Source, Ultimate Gaging Systems and Hot Stamp Tooling Systems are at 555 Plymouth Ave. NE, which is situated in the city’s SmartZone Satellite District.

“These companies are affiliates of the Tooling Systems Group, which is a family of mold and die stamping, assembly system, machinery sales and contract machining companies,” said Kara Wood, city economic development director. “This request is being made by the Tooling Systems Group, and each company has a different focus.”

The five firms are investing a total of $5.5 million into personal property; that investment is expected to create 95 jobs that will pay an average $30 an hour, based on average payroll but without benefit costs included.

“These tend to be very high-paying jobs,” said Mayor George Heartwell.

The investment also will retain 87 current jobs.

Advanced Tooling Systems designs, builds, re-engineers and services medium- to large-sized sheet-metal stamping dies and tooling systems. It’s investing $500,000 in new equipment over the coming year as part of an expansion project and will add 10 of the 95 new jobs.

“ATS is the flagship company of the Tooling Systems Group and was formed in 1983,” said Wood.

Concept Tooling Systems also is expanding. The firm designs and engineers sheet-metal stamping dies in full, three-dimensional solids and is the centralized stamping-die design center for the group. Concept Tooling is investing $50,000 and expects to add five new jobs to its work force. The firm was formed in 2005.

3-DM Source does contract machining services and machinery sales, specializing in one-off and low-run productions. The firm, which is known in the industry for finding its clients the right machines, is moving to Plymouth Avenue from Alpine Township and bringing its 28 employees to Grand Rapids with the move.

Ultimate Gaging Systems is a new company that opened last year. It designs, builds and repairs check fixtures and part gages. UGS is expanding over the next year and will add 12 new employees.

Hot Stamp Tooling Systems is investing $5 million into equipment because it is planning to move a new line of business here from Knoxville, Tenn. The manufacturer builds hot-form stamping die sets for the automotive industry and will use its investment to purchase a 1,000-ton hydraulic stamping press, two industrial ovens, and a robot to transfer materials between the ovens and the press. HSTS will bring 68 employees to the city when its move is completed.

The commission’s action will save the firms a collective $184,250 in state and local personal-property taxes. Some of that tax savings come from industrial exemptions commissioners awarded four of the companies last year. The city will abate $37,500 of that tax total, but will gain an estimated $59,700 in new income-tax revenue.

Wood said the Plymouth Avenue location offers about 2 million square feet of space for tooling firms; about half of that square footage is occupied.

Commissioners also approved an application for Steel Craft Technologies, a tool-and-die firm that is moving from Belmont to 1155 42nd St. SE. The company is also an affiliate of TSG. It makes hot-rolled plate products that are used in heavy-duty steel applications, welded assemblies and fully machined assembly die sets for the auto, construction and defense industries.

SCT is investing $800,000 into new equipment and will add 37 employees. The company will have $36,200 of its personal property tax abated, with $11,800 being exempted by the city. In turn, the city will gain $13,850 in revenue from income taxes.

Commissioners also set Nov. 27 to hear a request for an industrial tax exemption from Founders Brewing Co., 235 Grandville Ave. SW.

“Over the past five years, since relocating to their current facility on Grandville Avenue, the company has experienced significant growth and increased brand recognition. Currently, (it’s) the 42nd largest craft brewery in the world,” said Wood.

“Founders distributes its products to 23 states. The brewery is regularly ranked as one of the best in the country in various polls, and has beers consistently ranked in the top 10 in the world,” she added.

Founders plans to invest slightly more than $1 million into a 9,000-square-foot addition and $5 million into new equipment over the next two years. The company will add 20 new employees to its current work force of 77 from the investment. An exemption would save the company $35,720 in state and local taxes over a dozen years, with the city abating $12,635 of that amount and getting $8,570 in new income-tax revenue.

Mike Stevens and Dave Engbers, doing business as Canal Street Brewing Co., started Founders as a micro-brewery and tasting pub in the Brass Works Building at 648 Monroe Ave. NW in 1997. Pale Ale, a light, hoppy beer, and Red Ale, a maltier and sweeter offering, were their first brews.Founders released Bolt Cutter last month as its 15th anniversary ale.

Heartwell said he met representatives from the Chicago Federal Reserve Board last week, and they told him Europe’s economic woes are driving the U.S. economy now. “But (they said) West Michigan is a bright spot,” he said. “We’ve seen that with the industrial tax abatement requests that have been coming before us.”

Wood said the e-Star 2012 Award the city received from the business college at University of Michigan-Dearborn late last month for fostering the growth of entrepreneurism locally was gratifying.

“What it means is there still is a lot of work to do, but it does validate what we’ve done,” she said.

Derek Coppess, a principal in 616 Development, also validated the city’s effort in a video related to the award.

“When I moved my business up here, I had to choose between Lansing and Grand Rapids,” he said. “I chose Grand Rapids and I’m glad I did.”

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