Sixty percent tax abatements may be a thing of the past in Gardner.
The city’s existing tax abatement policy, which set the normal abatement rate at 60 percent, is set to expire at the end of this year. No development activity occured under the current policy. However, city council members approved a new policy re-setting the abatement rate to 50 percent during a city council meeting on Dec. 3.
Laura Gourley, city finance director, told council members that most neighboring cities cap their abatements at 50 percent. She recommended that Gardner do the same.
However, she told council members that the new policy is flexible enough that the council can still offer abatements between 1 percent and 100 percent.
“This policy is written broadly,” she said.
The new policy also drives targeted industries to targeted areas. It encourages the expansion of existing businesses rather than only focusing on new businesses.
Primarily, Gourley said the abatement policy targets warehousing and retail and is comparable to policies of other cities in the area looking to attract the same sort of businesses.
Council member Larry Fotovich asked why the city wasn’t looking for office buildings or corporate headquarters.
“If we realistically look at where we are and compare ourselves to places like Olathe, it was a long time before they were able to attract Garmin,” Mayor Dave Drovetta said.
Before Garmin built its corporate headquarters in Olathe, the city attracted warehouses and logistics businesses like UPS and the J.C. Penney’s distribution center.
“From a statutory standpoint, we could appoint up to 100 percent abatement assuming Time Warner Cable wanted to put its corporate headquarters in Gardner,” Drovetta said.
Gourley said the abatement policy isn’t a hard and fast law, but it allows potential developers to know what to expect should they consider building in Gardner.
“A policy is a publication of your guidelines,” she explained. “…ultimately, state statutes drive what you can and can’t do.”
Council adopts new tax abatement policy