News Photo by Steve Schulwitz Magnaloy Coupling Co. employee Craig Kaiser retrieves couplings produced at the plant in Alpena Thursday. Magnaloy is a division of Douville-Johnston Corp., which is in the final year of its tax abatement agreement with the city and has met and exceeded its obligations in terms of investment and hiring. The company is also poised to expand into a new location in North Industrial Park in Alpena.

ALPENA — The number of companies with tax abatements from the city is dwindling, and all will be expired by the end of 2024 if there aren’t any more granted.

Currently, three businesses receive tax breaks, and one of those deals are expected to expire at the end of the year. A fourth fell off the books at the end of last year.

City Clerk/Treasurer Anna Soik updated the Alpena Municipal Council on the status of the abatements and explained whether or not the companies have complied with the agreed-upon terms of the deals through the end of 2019.

When totaled, the abatements have helped contribute to more than $9 million in new investment in the city, Soik reported.

Soik said abatements are a tool the city utilizes to spur economic and employment growth in the city and encourage to reinvest and stay local. Still, she said, council members will need to weigh future abatement requests carefully.

“Economically, the city must decide if the impact on the city’s property tax revenue is adequately offset by the capital improvements and additional jobs resulting from the project,” Soik said. “With the loss of personal property tax, the city will need to consider future abatements.”

Mayor Matt Waligora said he is pleased with the successful projects the abatements have led to. He said using abatements in a reasonable manner shows that Alpena is open for business and willing to help bolster the local economy.

“Of course we will continue to scrutinize abatement requests, but, overall, I think they have been successful when you look at the investment and job creation,” Waligora said. “That investment from the businesses shows they are going to remain in Alpena for the long run and not pick up and leave or choose another location other than Alpena. To be able to lend them a hand is cool.”

Here’s a roundup of the tax deals still in the books:

ALRO STEEL

Alro Steel received a 12-year exemption in 2007 that concluded at the end of last year. It had committed to invest $325,000 in capital and add four new jobs and retain the two they had previously. According to Soik, the company had a total of eight employees at the end of the abatement and had invested $388,665, which exceeded the projections.

DOUVILLE-JOHNSTON CORP.

Douville-Johnston Corp. received a nine-year tax exemption, which will expire at the end of the year.

The abatement was for Douville-Joshnston’s Magnaloy Coupling Co. division, which is a manufacturer currently located on Commerce Drive. The company projected capital investment of $351,372 and an additional $75,900 in personal property spending. At the time of the approval of the abatement, the company projected seven full-time jobs and one part-time position would be retained and an additional five new jobs created from the expansion. Currently, it has 15 employees and exceeded its commitment on capital investment. According to its report, the company is actively trying to recruit more employees.

Soik’s report also notes that, last year, Douville-Johnston invested $1.4 million for new equipment for a new location in the city’s North Industrial Park.

DAVID KNEESHAW

Kneeshaw is the owner of the former Hunan Chinese Restaurant building near Starlite Beach, which has housed several Mexican restaurants since the 10-year abatement was granted in 2011. The capital investment projection for renovations to the old and vacant building was $200,000, plus 15 new full-time and three part-time jobs. Kneeshaw exceeded his investment into the building, but, because of several changes in tenants, the job creation has fallen short. Today, Pompeyos Mexican Grill has a five-year lease and has 12 employees, which increases to 17 during the summer. Kneeshaw made more improvements last year by adding an overhanging deck overlooking the beach and Thunder Bay. The abatement is set to expire at the end of 2021.

ALPENA LODGING

Alpena Lodging is the owner or the Holiday Inn Express and Suites downtown. It was granted a Commercial Rehabilitation certificate in 2014 for a 10-year exemption. The company projected of about $8.2 million and totaled about $8.3 million when the project was complete. It also spent $378,337 for the vacant property along the Thunder Bay River where the hotel was built.

The creation of between 15 and 20 new jobs were projected and, at the end of 2019, the goal was met, as there were 25 employees. The report did not distinguish how many were full- or part-time. The abatement expires at the end of 2024.

At the end of this year, only Kneeshaw’s and Alpena Lodging’s abatements will be on the books. Companies that receive abatements are required to file annual reports to the city so it can monitor the terms of the agreements.

Steve Schulwitz can be reached at 989-358-5689 at sschulwitz@thealpenanews.com. Follow him on Twitter @ss_alpenanews.com.