FORT WAYNE – Companies looking to invest in Fort Wayne will now have another incentive to bring higher paying jobs to the Summit City.
The City Council on Tuesday unanimously approved new “super abatements” that will extend the time companies can avoid paying any property taxes on new investments if they pay their workers well.
Councilwoman Liz Brown, R-at large, said the extra incentive is intended to help address one of the real problems plaguing the area.
“What we’re hurting for and what we need are high-paying jobs,” she said.
Abatements historically have allowed companies to gradually begin paying property taxes on new investment over time. For example a 10-year abatement could allow the company to pay no taxes on the investment in the first year, 10 percent of the taxes in the second year, 20 percent in the third year and so on.
The new policy will allow companies to avoid paying any property taxes on a project for the first five years. Abatements alleviate taxes only on new investment; they cannot be used to reduce a company’s existing tax burden.
A new state law allows up to 100 percent abatement for 10 years, but city officials said they decided to fully abate taxes only for five years. Councilwoman Karen Goldner, D-2nd, worked on the new policy with Brown and Allen County officials.
To qualify for the larger incentive, companies must prove they pay wages that are 10 percent higher than average for newly created jobs. The wages will be compared to Allen County employment statistics and companies will be required to disclose more information. If they choose not to disclose, they would still be eligible for traditional abatements.
The Allen County Council passed a similar incentive last week.