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Council rescinds trio of tax abatements

December 25, 2017 GMT

MICHIGAN CITY — In an unusual step, a trio of tax abatements were rescinded Tuesday by the Michigan City Common Council.

The one which drew the most discussion was with Calumet Pallet Company, 4333 Ohio St., which drew the ire of several council members as the company has been non-compliant with terms of the abatement, according to Clarence Hulse, executive director of the Michigan City Economic Development Corporation.

Michigan City Fire Marshal Kyle Kazmierczak and Building Inspector Sue Downs spoke about numerous fire code violations that were discovered at the site and that no attempts to fix those violations have been made. Kazmierczak said there were 12 violations and that nine “are considered life-threatening.”

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Downs said the owner “makes a lot of promises, but there’s been not any bit of action toward promises he’s made.”

In fact, Kazmierczak said existing violations appeared to be worse on return inspections.

“In August, we did a third major walk-through then came back in November and, not only were the citations unaddressed, but there was new product put down on old product, producing even more of a fire hazard,” Kazmierczak said.

Kazmierczak and Downs both indicated a desire to work with companies who are making any kind of progress toward correcting violations.

“The product (leading to the violations) creates a problem for people in the building and first responders coming to the building,” Kazmierczak said.

Reached for comment Thursday, Calumet Pallet owner Jeff Bridegroom refuted claims by city officials, saying he was unaware of any violations.

“When they did an inspection, the only thing the fire department questioned me on is that we didn’t have a lock box,” Bridegroom said.

On Thursday, Downs was surprised to learn Bridegroom said he was unaware of violations.

“We actually did a spiral-bound book (detailing the violations) and it was handed directly to him,” Downs said. “(Him not being aware of violations) is absolutely not accurate.”

Downs said infractions ranged from minor to major, but that scrap lumber in one area of the property made it impossible for fire trucks to gain access. Bridegroom said scrap lumber was valuable to his company because they grind it down and turn it into mulch and various other products. Bridegroom said, though, that the company’s grinder isn’t functional and is out for repair, but wasn’t sure when it would be fixed.

A letter sent to the city from Bridegroom detailing problems the company has had since moving to Michigan City from Hammond was “a laundry list of excuses,” according to councilwoman Sharon Carnes, and was “derogatory and condescending toward the government and people of Michigan City,” according to councilman Tim Bietry.

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“I have no sympathy for this gentleman,” Bietry added.

Thursday, Bridegroom couldn’t understand why the letter was characterized in such a way by those on the council.

“The councilmen can say whatever they want, that’s their opinion and I know the truth,” Bridegroom said.

In the letter, Bridegroom talks in some detail about issues the company has faced, which include the following passage:

“Finding adequate and proper employees willing to work. I feel this is due to our government providing for welfare system making it unnecessary for them to have to work.”

Bridegroom also wrote in the letter his company lost 95 percent of its workforce upon the move to Michigan City and a large portion of the customer base. He did say in the letter that his company was recently awarded a $20 million, 5-year contract with a local steel company and “are actively hiring new employees pretty much on a daily basis.”

Thursday, Bridegroom said he is hopeful to continue to work with the city in the future.

“I wanna work with the city of Michigan City and residents here to be an asset, and we’re not here to be a liability in way, shape or form,” he said. “I want to do everything in a proper way. I’m not doing anything illegal, just trying to run my business properly.

Bridegroom said he was surprised to learn the abatement had been rescinded because he said Hulse told him he’d get it taken off the council’s agenda. Reached for comment Thursday, Hulse said he made no such promise.

“I told him I would do my best, but that it was out of my jurisdiction. I can’t promise to take anything off the agenda,” Hulse said.

Even without the abatement, Bridegroom said the company will continue on.

“We are providing jobs for the people of Michigan City and continue to hire on a continuous basis,” he said. “We’re looking to expand in Michigan City ... the loss of these abatements will not put me out of business.”

The other two abatements were rescinded without much fanfare. An abatement for Central States Manufacturing from two years ago was pulled back when the company’s plans changed.

“They will do something in the future (with possible expansion), but not with this abatement,” Hulse said.

Another, for Chicago Craft Bottling LLC, was pulled back when the company lost contact with the city. Hulse said the company “showed a lot of promise” when the abatement was issued in 2014, but they’ve been “off the radar.”

Hulse added attempts to contact the company, who even purchased a building in Michigan City, have been unsuccessful and he recommended the abatement be rescinded.

All three abatement recisions were unanimously approved. Katie Eaton, of EDCMC, clarified that because compliance hadn’t taken place, no tax savings had been incurred in any of these cases and therefore no money is owed back to taxpayers.

Eaton added that the abatements were rescinded at the suggestion of the county “so that they don’t keep showing up on their books.”

Eaton said there are about a dozen abatements that have been active within the last 10 years in Michigan City, with another two added earlier this year.