Tax abatements approved for Verbio investment in South Bend
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The South Bend Common Council this week gave preliminary approval for two tax abatement requests from Verbio North America Holdings Corp., which last week acquired the South Bend Ethanol plant.
If it receives final approval, the company would save about $16.5 million in taxes over the next eight years on the property, where Verbio plans to invest $230 million to expand and develop the plant to produce renewable natural gas in addition to ethanol.
The requests include a five-year personal property tax abatement, which would waive $15.7 million in taxes, though the company would still pay about $3.5 million in taxes over the same period.
An eight-year real property abatement would waive about $788,000 for the company, which would still pay about $2.8 million in taxes.
Eric Glavich, director of growth and opportunity for the city of South Bend, told the council the taxes that will be paid are new taxes in addition to what is already being paid to the county from the site.
When the acquisition was first announced, Verbio said it plans to use the stillage that comes from the production of ethanol for the production of renewable natural gas.
As part of the $230 million expansion effort, Verbio North America CEO Greg Northrup said about $20 million will be used to fine tune the ethanol production operation, which will allow the plant to reach its 85 million gallon capacity.
The company will also take about three years to construct 16 anaerobic digestion tanks that will have the capacity to produce 2.8 billion cubic feet of RNG annually.
South Bend Regional Chamber of Commerce Director of Economic Development Alyson Herzig told the council the project will generate about $351 million in economic impact for the construction industry over the three year period.
Verbio said the project will retain 61 employees at the plant and create eight new jobs.
The council is set to make a final vote on the abatement requests on May 22.