NORMAL — McLean County taxing bodies are getting some money back because of a delay in Rivian's planned upgrades to the former Mitsubishi plant in west Normal.
The electric automaker was required to spend $10 million improving the plant by the end of 2018 to receive a property tax abatement, but much of the planned work was pushed into 2019, meaning local schools and governments will keep about $650,000 they expected to lose.
"This is why we create these clawbacks, so we protect the taxpayers if somebody doesn't meet the standards," said Mike O'Grady, interim executive director of the Bloomington-Normal Economic Development Council, which oversees the abatement.
It's a rare bit of bad news for the company that revealed its R1T pickup and R1S SUV last fall and has since drawn a $700 million investment led by Amazon and a $500 million investment from Ford Motor Co. Both vehicles are expected to hit the market in 2020.
The company said in a statement Tuesday, "We did not apply for the abatement this year because of delays in plant equipment arriving at our facility, but we maintain our projected manufacturing dates."
"This wasn't a performance issue so much as it was a logistics issue of trying to get the engineering done, materials purchased, contracts let," said O'Grady. "Amazon and Ford are not going to make the kind of investments they are in a company that they don't think is going to perform."
He noted Rivian is on track to exceed its 2019 goal of $22 million invested — further goals are $32 million in 2020 and $40.5 million in 2021 — and is already near its 2019 goal of 75 full-time employees at the plant, with goals of 300 in 2020 and 500 in 2021.
"The paint line alone is $35 million, and that's in the process now," said O'Grady, adding Rivian is also overhauling the plant's assembly line and doing office remodeling at a cost of more than $2 million.
Rivian is in line to receive an additional $1 million grant from the town of Normal for investing $20 million within five years and state tax credits worth about $49.5 million for creating 1,000 jobs over 10 years.
The lion's share of the missed property tax rebate will go to Normal-based McLean County Unit 5 schools, which gets 59 percent of the site's property taxes — $389,318 for 2018. That money "will be split between all of the district funds based on how the district tax rate is allocated," said Dayna Brown, Unit 5's director of communications and community relations.
The district's budget is more than $100 million.
Normal receives 11.2 percent of the site's property taxes; McLean County, 10.1 percent; Heartland Community College, 6.4 percent; Normal Public Library, 4.9 percent; Bloomington-Normal Water Reclamation District, 2 percent; and Bloomington-Normal Airport Authority, 1.1 percent.
Three taxing bodies didn't participate in the abatement: Dry Grove Township Road District, 3.7 percent; Dry Grove Township, 1.5 percent; and Dry Grove-White Oak multi-township assessment district, 0.1 percent. Rivian paid those bodies about $74,000 in 2017 despite hitting its rebate goals.
Rivian paid $16 million for the shuttered Mitsubishi plant in early 2017. Mitsubishi shut down production at the plant in November 2015 and laid off the last employees the following May. The plant employed 1,200 before closing and about 3,000 at its peak.