NORMAL — McLean County Unit 5, the largest taxing body associated with the former Mitsubishi Motors North America property, cautiously approved a property tax abatement agreement with Rivian Automotive at Wednesday night’s school board meeting.
While board members were concerned about how the revenue loss would hit the district, officials also were interested in the economic development and educational opportunities Rivian promises.
The Normal City Council voted Monday to approve a $1 million grant and to abate town property taxes for the plant for five years if Rivian meets investment and employment goals. Heartland Community College and the Bloomington-Normal Airport Authority also have approved the abatement, and the McLean County Board’s executive committee has recommended approval to the full board.
Although the abatement was approved unanimously by the school board, Rivian CEO RJ Scaringe and Bloomington-Normal Economic Development Council CEO Kyle Ham listened to concerns from board members about the amount of tax revenue that could be lost under the agreement.
“I don’t know if you really understand the (financial) constraints we’re under. We struggle. We cut educators and administrators and we get by, which is not what we want. Education is what makes this community outstanding,” said board member Gail Ann Briggs.
The district received $390,000 in property taxes last year from the plant, which ended production in November 2015 and closed completely in May. Unit 5 business manager Marty Hickman said, “Regardless of the deal, we know we would receive far less if we went forward with no one on that land."
Board President Meta Mickens-Baker explained how the community “has been poignant” in voicing worries over the growing class sizes in the district because of a tight budget.
“Our surplus is $90,000, not $400,000,” said Mickens-Baker. “That would be teachers we can’t put in classrooms.”
Normal City Manager Mark Peterson, who was in the audience, explained that if the sale does not go through, the plant would be demolished and the property tax revenue could virtually disappear.
“If the plant does not move forward, you would get nothing forever,” said Peterson. “You’ll lose money, either for five years or for much longer. Unfortunately, that’s the choice we have.”
Before the vote, board member Barry Hitchens said: “I hope the EDC and the town of Normal recognize the sacrifice Unit 5 is making. If we ever come to you in need of assistance, I expect the answer to not be, ‘No, we cannot help you.’”
Rivian must employ 500 workers and invest $40.5 million in the plant by the end of 2021 to get the incentives, but Rivian plans to employ 1,000 workers and invest $175 million in the site through 2024 — starting with traditionally owned electric cars to be made in 2019 and available in 2020. The sale by plant owner Maynards Industries and a state incentive plan remain pending.
Scaringe explained how Rivian could provide learning opportunities for students in the Twin Cities.
“This facility has a lot more potential than just making cars,” said Scaringe. “We could provide internships, open-house opportunities, letting students use the fabrication space for projects as part of a maker’s movement. We’re looking at how this can be a part of the education system and community.”
Scaringe also said that once the plant starts building prototypes, there is a possibility the units could be donated to schools for shop classes.
“We’d love to sit down and brainstorm with students. I’m a huge advocate for STEM (science, technology, engineering and math) and we could really help students understand what STEM means and why it matters,” said Scaringe.
Superintendent Mark Daniel said that while the agreement could mean property tax hardships for the district, he said, “I’m drooling in regards of the educational possibilities.
“Those possibilities speak directly to our district’s mission,” said Daniel. “We want you (Rivian) to be successful. I’ve learned that this community comes forward and makes things happen. You’ve landed in an opportune place, but we also want Unit 5 to be successful.”