The Chicago City Council voted unanimously on Jan. 27 to support a Class 6(b) property tax classification incentive for West Garfield Park-based Chicago Anodizing Company, 4112 W. Lake St. The tax credit will support the company’s recent expansion to the neighboring lots at 4118-4136 W. Lake St.
The incentive temporarily lowers the regular property tax rate for industrial properties to encourage industrial development. In 2020, Chicago Anodizing built a 20,5680-square foot warehouse and office addition to its existing facility, which is expected to create six additional jobs.
The company took on $1.46 million in debt to finance most of the project costs and the incentive is expected to save the firm $172,494 in property taxes over the next 12 years, according to the company’s application for the tax credit.
The Chicago Department of Planning and Development members supported the incentive, arguing that, even with it in place, the property would generate more in taxes than a vacant lot and jobs would be created on the West Side in the process.
The Chicago Anodizing Company was founded in 1947 and it’s been based out of the same West Garfield Park building ever since. The company applies finishes to aluminum products through the process known as anodizing.
According to its website, the parts that the company anodizes are used in everything from cars to dental equipment. Some of its customers include Ford, General Motors and Lockheed Martin.
In Cook County, property tax rates are based on their use. Normally, industrial properties are taxed at 24 percent. The Class 6(b) tax incentive classification lowers that to 10 percent for the next 10 years, then increases it by 5 percent a year over the next three years, until it returns to regular level.
While the Office of the Cook County Assessor makes the ultimate decision, it won’t grant approval unless the municipality where the property is located signs off on it.
During the Jan. 21 meeting of the City Council’s Committee on Economic, Capital and Technology Development, Emmett Morrissey, a financial planning analyst for the planning department’s financial incentives division, explained that the vacant lot next to Chicago Anodizing building has been “informally used as a parking lot” for years.
The company spent a total of $2.13 million on the project, using $95,000 to buy the land and a total of around $1.8 million to build the new, taller warehouse and office space addition. Although 26 percent of the funds came from equity, the rest came from loans, he said.
According to Morrissey’s presentation, the vacant lot generated $1,730 a year, which would translate into $20,760 over the next 12 years. If the Class 6(b) incentive is granted, the property would bring in almost seven times that — $141,502 over the next 12 years. However, the presentation also indicated that it would pay $313,996 in property taxes if the incentive isn’t granted, which would bring $39,781 more in taxes than if the incentive is granted.
Morrissey also touted the fact that the incentive would allow Chicago Anodizing to keep 60 jobs and hire six more people to accommodate the expansion.
Co-owner John Serritella didn’t respond to a request for comment by deadline.
The committee voted unanimously to support the Class 6(b) application and it was approved by the full City Council as part of a package of measures previously approved at the committee level.