|Tyer Pitches Incentive Package For LTI Smart Glass Expansion|
|By Andy McKeever, iBerkshires Staff|
02:00AM / Wednesday, September 13, 2017
|Mayor Linda Tyer submitted the petition to use $580,000 of the Pittsfield Economic Development Funds in the incentive package for LTI Smart Glass. |
Christopher Kapiloff, a principal with LTI Smart Glass, shows the company's new product at a meeting with economic development and state officials earlier this year.
PITTSFIELD, Mass. — Mayor Linda Tyer is asking to use $580,000 of Pittsfield Economic Development Funds to help LTI Smart Glass expand.
LTI Smart Glass is looking at a 16,692 square-foot expansion to its current Federico Drive facility to accommodate a large contract the company recently received for its newest bulletproof glass product. It requires a $2.25 million capital investment and will add 38 new jobs over the next three years.
"We've worked closely with them in putting together a proposal that I think is supportive of them and fair to us for what we want to use economic development funds for," Tyer said during a recent interview.
The company had offers to expand elsewhere in the country and Tyer and the Department of Community Development have crafted an incentive package hoping to keep LTI in the city.
"The proposed expansion project represents a $2.5 million capital investment and the creation of 38 new jobs by the end of 2019, in addition to the existing 100 jobs and $5 million investment the company has made in Pittsfield since 2008," Tyer wrote in her request to the City Council.
The amount would total $580,000 over multiple years and require continued job growth at the facility. The package provides incentives for both job growth and investments in the facility. The expectation is a minimum of 38 jobs — 12 in 2017, 11 in 2018, and 15 in 2019 — and additional incentives should the company expand beyond that.
"To share the benefits of LTI's growth with the city's taxpayers, the proposed incentives include a cash payment upon completion of the expansion in lieu of extending the company's existing tax increment financing agreement with the city," Tyer wrote to the City Council.
"In addition. I am proposing a 'challenge' component to the City's financial support to encourage LTI's continued growth in Pittsfield beyond 2019."
The company would receive $200,000 upon the issuance of a Certificate of Occupancy once the expansion is completed; $100,000 six months later if there is a total of 123 jobs based at there no later than Dec. 31, 2018 — $80,000 six months later at the 138 jobs point; $100,000 if it hits 163 jobs; another $100,000 if the company hits 188 jobs. The jobs must be full-time equivalent and pay at least $35,000 a year. A total of 38 new jobs is expected.
The company would also receive $80,000 through an expansion of its current Tax Increment Financing agreement, $200,0000 if it creates 50 more jobs by the end of 2022 — in addition to the 38 required by the end of 2019 for a total of 88 new jobs in five years.
The Department of Community Development also estimates a total of $600,000 eventually be added to the city's tax base with the expansion. It includes the purchase and installation of glass-tempering equipment, allowing a manufacturing component currently outsourced to be done in house.
The money will be issued as a promissory note for 10 years. The city has the right to receive those funds back if LTI opts to relocate, closes or the employment numbers drop below 100 employees for more than 18 months.
LTI has been on Federico Drive for just short of a decade and currently employs around 100 people. It had moved from Lenox, bringing 30 jobs with it at the time. The city provided an incentive package of $350,000 to create 100 jobs. But the recession had hit and the company fell short and only had 70 by the 2013 deadline.
In total, the city gave the company $250,000 through that package. The city also provided a tax increment financing package, delaying the amount of new taxes the company would have to pay because of increased property values caused by that investment.
The company manufactures and distributes numerous glass products, but the most recent contract is related to its security products. The company has had contracts to do the windows and doors at Sandy Hook Elementary School in Connecticut, in police cruisers, at the Pentagon, and at the FBI's Hoover Building headquarters.
"In the past five years, the economy has recovered, the company has adapted to changing market dynamics, and in 2016 merged with Kapiloff Glass of Adams, MA [sic]. As of February 2017, the company has 100 employees at the Federico Drive facility, is expanding its manufacturing facility on Federico Drive, and is bringing in-house a key component of its manufacturing process that has previously been outsourced," reads a memo from Community Development Director Deanna Ruffer.
"The 2016 merger with Kapiloff Glass, Inc. has further strengthened the financial and operating capabilities of the firm. The merged companies are owned and operated under the umbrella holding company of Advanced Impact Technologies Group, Inc. Jeff Besse, one of the two founders of LTI Smart Glass, owns 51 percent of the holding company with Peter and Chris Kapiloff each owning 24.5 percent."
The ownership group is Advanced Impact Technologies Inc. with a number of companies underneath it including LTI SmartGlass; Laminated Technologies Inc.; School Guard Glass; and others.
The City Council's Committee on Community and Economic Development will consider the request next week.