School District Considering Tax Abatement for Trobec’s
ST. CLOUD -- A proposed tax abatement for a business moving to St. Joseph took another step forward Wednesday night.
Trobec’s Bus Service and the City of St. Joseph proposed the abatement to the St. Cloud Area School District at this week’s school board meeting.
Trobec’s has been at their St. Stephen location for 81 years and will be starting construction on a new facility just over 108,000 square feet this fall. The proposed abatement will help cover a $450,000 gap in funding for the $7.2 million project.
Board Chair Jeff Pollreis says there would be several benefits for the district to get involved.
To have Trobec's in that location with a new facility, their buses will be closer to the district. It will save money for routes, more efficient routes. If you need a backup bus or if a bus breaks down they are already that much closer. Once again it's adding 15-25 jobs and they're paying taxes on that. It's a win-win I think.
The new facility will include heated housing for up to 75 buses and 14 motor coaches as well as office and conference areas, a mechanic garage and wash bay, parts and inventory, and a showroom. Trobec’s is one of four bus companies used by the district.
Amy Skaalerud is the Executive Director of Finance & Business Services for the district. She says the abatement would begin on taxes payable in 2021.
It's not really lowering their taxes or giving the company a tax break. What it's doing is deferring when they have to start paying tax on the new growth, the new expansion of the tax base. The city is proposing a partial abatement. You can either abate the whole increase in the tax capacity or you can do a portion of it.
The district is considering the abatement of 50 to 75 percent of their $31,000 tax capacity increase from the build over the course of five to six years. The abatement would not impact the district’s overall tax revenue.
The finance committee will now put together a resolution to be considered at a future board meeting, and a public hearing will be scheduled.
Previously the St. Cloud Area School District has approved abatements for Marco in St. Cloud and Country Manor in St. Joseph.
The proposal was approved by the St. Joseph City Council back in June. A proposal has also been brought to Stearns County.