NORMAL — A week after Rivian Automotive revealed it wants to buy the former Mitsubishi plant in Normal and make electric cars there, all the pieces are falling in place for the company to get the tax breaks necessary to make it happen.
Of 10 taxing bodies affected, six have approved five-year performance-based property tax abatements for Rivian, with one more on tap and three still in negotiations.
Rivian must employ 500 workers and invest $40.5 million in the plant by the end of 2021 to get the tax breaks.
The company also is negotiating with the Illinois Department of Commerce and Economic Opportunity for state incentives. Once that deal is complete, the company plans to buy the plant from Maynards Industries, the asset liquidation company that bought it from Mitsubishi in June.
While each taxing body specified how much it received from the site last year, those figures are unlikely to represent how much each could expect to receive going forward.
If Rivian succeeds, the value of the plant property will increase, and the abatements will become more valuable.
If a deal had not been made, the plant would have been demolished, the property value would have plummeted, and property tax revenues would have dropped.
McLean County Unit 5
Normal-based McLean County Unit 5 schools, which receive nearly 60 percent of property taxes paid on the plant, approved the abatement on Wednesday, though some school board members voiced concerns about the financial impact.
The district received a total of $390,000 in property taxes last year related to the plant.
Superintendent Mark Daniel said the agreement could mean financial hardships for the district, but “I’m drooling in regards of the educational possibilities."
Town of Normal
The Normal City Council was the first major taxing body to approve the abatement Monday. Normal also will give a $1 million grant if Rivian buys the plant and invests $20 million in the site.
The town received about $72,000 in property taxes from the plant last year, said town Communications Director Dan Irvin, though that includes a 595-acre area rather than the 484 acres to be used by Rivian.
"There's so much to gain, and, from our perspective, not much to lose," said council member R.C. McBride of the deal.
The McLean County Board will consider the abatement when it meets Tuesday morning. It passed the board's executive committee on Tuesday.
The county received about $71,000 in property taxes from the site last year.
"When you're accepting most of the risk, that's a no-brainer for me," board member Erik Rankin said on Tuesday. "This is a great story that I think makes people feel good about our community."
Heartland Community College
Heartland Community College's Board of Trustees approved the deal Tuesday.
The college district received $42,000 from the most recent property tax payment from the Mitsubishi property.
President Rob Widmer said money lost from the tax abatement would be taken into account when budgeting, but he sees the agreement as a “long-term gain.”
Normal Public Library
Though Normal Public Library taxes the plant separately from the town — nearly $35,000 last year — "the town of Normal is the levying entity for the library, so there is no separate agreement that requires approval," said Irvin.
Dry Grove Township
Dry Grove Township hasn't approved any abatement for Rivian from its three levies — and won't, at least in the short term.
“We don’t have a lot of room inside of (our budget) to abate taxes,” said Township Supervisor Jim Phillips. "We’re working with (EDC) to come up with something that would be satisfactory for us and also Rivian.”
In Dry Grove, there are three taxing bodies involved: the road district; the township; and the Dry Grove-White Oak multi-township assessment district. Together, the three received about $38,000 from the plant last year of a $320,000 budget, Phillips said.
“It might take us a month before we come up with something,” he said. “There’s not a big rush. If the sale goes through, we'll be working after that to see what incentives we can give.”
CEO Kyle Ham confirmed the EDC is working with Dry Grove on an abatement deal, and it won't hold up Rivian buying the plant.
"They’ve been supportive in concept of the project,” Ham said of the township. "We'll work with them to find a way for them to participate.”
B-N Water Reclamation District
Bloomington-Normal Water Reclamation District approved an abatement deal on Thursday, said Executive Director Randy Stein.
The district received about $12,000 in property taxes from the two parcels of the plant it taxes — far less than the $115,000 in user fees it received from the facility when it was producing cars.
“A lot of that $115,000 helps offset our fixed costs,” Stein said. "We're very excited to support this."
B-N Airport Authority
Bloomington-Normal Airport Authority approved an abatement Monday, said Executive Director Carl Olson.
“We’re the smallest of all the taxing districts, so it’s only about $8,000 a year (in property taxes received from the site),” he said. “It’s a good initiative for the community, and we’d like to move it forward so everyone can be successful.”