New manufacturer coming to commission

August 5, 2011
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The city’s latest manufacturing joint venture has its first date with Grand Rapids city commissioners this week in its quest to have two existing industrial tax exemptions transferred to the new entity.

Worthington Industries Inc., a publicly traded firm based in Columbus, Ohio, announced in May that its automotive body panels’ subsidiary, The Gerstenslager Co., had entered into a 50/50 joint venture contract with International Tooling Solutions LLC, which has its headquarters at 731 Broadway Ave. NW.

ITS is a tooling and stamping company with locations in Grand Rapids, Walker and Frankfort, Ky. The company entered the local manufacturing scene in 2003 when it purchased Maghielse Tool Corp. Since that transaction, ITS has grown from 33 to 125 employees.

“They have two current tax exemptions with the city,” said Kara Wood, city economic development director.

The new joint-venture entity is ArtiFlex Manufacturing LLC. Wood said the firm plans to continue operations as ITS has for the past eight years and maintain the same employment numbers.

“ITS and Worthington have similar employee- and customer-focused operating philosophies, and we believe combining these operations will lead to a stronger business platform,” said John McConnell, CEO and chairman of Worthington Industries.

The city granted ITS two industrial abatements in 2006, one for a real-property investment that totaled $220,000 and one for a personal-property investment of $600,000. The tax cut for the real-property exemption runs through 2019, while the personal property abatement runs through 2016.

City commissioners are expected to grant the transfers through a three-step process. They will hold a public hearing on turning over the abatements this week, which is the first step.

“This innovative solution dramatically reduces our customers’ (capital expenditure) and lead time required to bring new products to the market in a more cost-effective manner,” said Erin Hoffman, owner and president of ITS.

ITS and Gerstenslager had worked together for the past year through a co-marketing initiative. The new ArtiFlex Manufacturing now has five plants: the ITS facilities and one each in Clyde and Wooster, Ohio.

Commissioners will hold three other hearings this week: two for eAgile Inc. and one for Grand Rapids Label Co.

EAgile, a high-tech firm that identifies, tracks, records and stores data, is planning to invest $179,500 in real property and $4.6 million in personal property across two expansions over the next two years. The firm is located at 1100 Hynes Ave. SW and plans to add seven employees to its current staff of 13 from the investments.

“This is an exciting project and an example of economic gardening. The abatement will help them grow in the city and add new jobs,” said Wood. Commissioners will consider granting eAgile an industrial development district and a 12-year tax exemption. Each request will receive a separate hearing.

Grand Rapids Label, 2351 Oak Industrial Drive NE, is also applying for a 12-year tax abatement. The company plans to invest $1.8 million in new equipment; this investment comes on the heels of a $1.2 million investment the firm has made over the past two years.

Grand Rapids Label has 59 workers and hopes to add 10 more over the next two years.

“This is a company we’ve had a long relationship with,” said Wood. Grand Rapids Label has been in business here for over a century.

Commissioners recently agreed to transfer a 2004 tax exemption originally awarded to The W Group to Pixie Properties LLC, which bought the company last summer. The exemption was awarded for a total rehab of the firm’s building at 315 Richard Terrace SE.

“This is an ownership change; the project hasn’t changed. We want to make sure this stays with the owner,” said Wood.

Commissioners reluctantly consented to transfer an exemption the city awarded to Medbio Inc. because the firm is moving to Cascade Township. Medbio serves the medical and biotech industries and has outgrown its leased location on South Division and has bought a building that is 20,000 square feet larger in Cascade.

Wood said Medbio has 11 years left on its exemption. The firm grew from 34 to 51 employees while it was in the city. “We tried to find them a location in the city,” she said.

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