WESTFIELD – The City Council approved a five-year tax incentive financing (TIF) package which will facilitate construction of an addition and creation of 17 new jobs at a local manufacturing company.
The five-year TIF was requested by Tell Tool, Inc. which was founded in 1976 by Paul Drewski and William Weber, to facilitate construction of a 35,000-square-foot addition to the plant located at 35 Turnpike Industrial Road.
The company, under provisions of the TIF, will add 17 new jobs to its current workforce of 100 employees.
At-large Councilor James R. Adams, a member of the council’s Legislative & Ordinance Committee (L&O) presented the package for discussion Thursday night.
“This is a TIF, not an STA (Special Tax Assessment),” Adams emphasized. “They will continue to pay the full tax on the existing building; this TIF is only for the 35,000-sqaure-foot addition.”
Adams made that distinction because the TIF only provides tax relief on new construction while the STA extends tax relief to the entire existing facility and equipment, which is taxed as personal property.
The package is structure to give a 90 percent tax discount on the addition in year I1, dropping to 75 percent in year 2, 50 percent in year 3, 25 percent in year 4 and 10 percent in year 5.
Ward 1 Councilor Christopher Keefe said the package averages out to a 50 percent tax cut over the five years, meaning that, because the commercial tax rate is nearly double that of that for residential property, the company will be paying at about the same tax rates as city residents.
“It falls within the guidelines established by our former colleague (Ward 5 Councilor Richard E Onofrey Jr., who served as the chairman of the Finance Committee which reviews TIFs and STAs),” Keefe said.
At-large Councilor and L&O Chairman Brian Sullivan said his committee spoke with the Tell Tool officers prior to bringing the TIF package out at the council meeting.
“They were founded here, they don’t want to go anywhere, there was never any mention of relocating someplace else,” Sullivan said. “They need this because they signed a 15-year contract with a customer (Hamilton SundStrand, a division of UTC Aerospace). This TIF also qualifies them to go after state money and other revenue sources.”
At-large Councilor David A. Flaherty said that he is much more comfortable with considering TIFs than with STA because the tax relief is limited to new construction and not existing facilities.
“Tell Tool is a great company,” Flaherty said. “I’m glad they are doing this in Westfield. I support this TIF 100 percent. It’s much better than an STA.”
The TIF was approved by a vote of 12-1, with At-large Councilor Cindy Harris voting against the package. Harris objects to both STAs and TIF because the total tax levy is not adjusted, meaning other taxpayers subsidize the firms being given the tax relief.
