Peerless Pump Co. is in line to receive a pair of tax abatements from the city after the manufacturer spent more than $18.7 million to improve its Indianapolis plant between 2010 and 2014, the Department of Metropolitan Development said Tuesday.
According to the DMD, the tax breaks, which are worth about $772,000, will reward the company for retaining 280 employees in Indianapolis and adding 44 more since 2010. Those employees make average wages of at least $26.40 per hour.
They tax breaks also could help fuel an even bigger expansion in the near future, the DMD said.
Peerless, which makes industrial water pumps, has operated from facilities near Methodist Hospital since 1946. The company has been talking to the city for years about a major expansion at the site, the DMD said.
The property, however, is landlocked by Dr. Martin King Jr. Street to the west, West 21st to the north, Interstate 65 to the east and a Department of Public Works maintenance garage to the south.
In 2010, Peerless began talks with the city to buy the DPW garage so that it could launch a $35 million renovation and expansion. Those talks continue but have yet to result in a sale, the DMD said.
In the meantime, Peerless spent $10 million to renovate and add two additions to the existing facility and invested in $8.75 million in equipment for the plant.
The DMD said the improvements qualify the company for retroactive 10-year abatements of about $226,406 in real property taxes and $545,328 in personal property taxes.
Peerless would still pay nearly $80,000 in real property taxes during the abatement period, and an estimated $30,600 per year in real property taxes and $32,800 in personal property taxes afterward. That’s in addition to more than $95,000 in annual property taxes already being paid on the property.
The DMD said Peerless, which was acquired by Denmark-based Grundfos Group in 2007, needs to continue to modernize its facilities to stay on par with other Grundfos properties. The company might have to consider relocating if it's unable to reach a longer-term deal to expand into the DPW garage site, the DMD said. City planners said the incentive deals will help Peerless maintain operations while it continues negotiations with the city over the site.
The abatement resolutions will be heard by the Metropolitan Development Commission on Wednesday and could receive final approval at the May 6 MDC meeting.