The Franklin Redevelopment Commission has canceled a deal in which it would have financed the $2.3 million purchase of a vacant industrial building to attract a California-based beer company that planned to hire 150 workers over the next three years.
The commission decided Thursday to call off the deal because TailGate Beer of San Diego failed to respond to a deadline to provide detailed financial information.
In April, the Indiana Economic Development Corp. offered TailGate Beer up to $1.85 million in performance-based tax credits and $100,000 in training grants based on the company's plan to create as many as 150 jobs over the next three years in a multi-million-dollar production, packaging and distribution facility.
"[The commission] started asking for updated information way back in April," said Craig Wells, executive director of Franklin Development Corp., the economic development entity that would have purchased the 48,000 square-foot-building at 1800 Musicland Drive.
"I think there were some red flags based on some information he had provided at the April meeting," Wells said of TailGate owner Wesley Keegan. "The original vote was contingent on receiving satisfactory financial information."
Although Keegan later indicated he didn't intend to provide any further information, Wells said the development corporation held up its end of the bargain by reaching a purchase agreement with Coyote Development. Wells said the development corporation won't lose any money by letting the purchase agreement expire.
Coyote Development built the manufacturing space in 2008 for Klaisler Manufacturing Corp of Franklin. Both companies are owned by Terry Hubbard. Wells said Klaisler never occupied the building because of the recession.
Other incentives that had been on the table for TailGate included $900,000 in lease guarantees, a $300,000 loan and a $200,000 grant for "greening" the building and operations, Wells said.
Mayor Fred Paris said he’s still in favor of having the Franklin Development Corp. buy the building on the chance of attracting a different company. “This is a phenomenal building in a great location. A lot of times requests we get are looking for buildings like this,” he said.
Paris noted that it took six months to negotiate the purchase agreement because, as a short sale, it had to be approved by the bank and the Small Business Administration. If the building slips into foreclosure, Paris said, it would be nearly impossible to make it available to a new company in a timely way.