Engineering firm plans 145 new jobs Warren company gets state tax credit, seeks local incentive.
An engineering firm in Warren expects to create 145 jobs in the next five years, job growth that in a dismal economy has earned the company a state tax credit and possibly a local tax break.
Waltonen Engineering plans to add two-thirds of those positions within two years, part of an overall $9 million investment at its facility on Mound Road near 13 Mile.
Welcoming such numbers, Warren city administrators are recommending a tax incentive that could save the company 50 percent on its property taxes tied to new machinery, equipment and other personal property.
"I'm sure you can find 145 unemployed engineers in the city thrilled to see it," said Gina Cavaliere, Warren's director of community and economic development. "We can't require (local hiring) but we do ask companies to look in their backyard."
The City Council is scheduled Tuesday night to hold a public hearing to create an Industrial Development District at Waltonen Engineering. That designation is a legal precursor permitting a company to then seek tax considerations from local municipalities, under a state law enacted in 1974 to entice companies in Michigan to not relocate jobs to the Sun Belt.
Waltonen Engineering President Lloyd Brown did not immediately return a message left Monday by The Macomb Daily. But according to documents filed with the city, the project involves three-dimensional computer-assisted design and computer-assisted engineering services.
Waltonen has been awarded three "major" projects that will require additional workers and improvement and expansion of its 30,000-square-foot facility just north of 13 Mile, records show. One involves engineering and design for an unidentified defense contractor working on a ground vehicle. The second includes engineering, design, program management and quality analysis for an unspecified European company that is slated to supply a U.S.-based original equipment manufacturer with complete vehicle engineering and integration.
The third project also involves a major military contractor and involves engineering modifications for a ground vehicle system that is currently being manufactured.
"These are advanced engineering and design jobs that require highly skilled and trained workers. These skills are in demand by other industries, and will bring those companies here to the state searching for this knowledge base," the company said in description of the project.
The average weekly wage of new jobs will be $872, the company said.
The project also will help Waltonen Engineering retain 125 jobs.
The firm has evolved from a company that mostly handled automotive contracts, to one where much of its work involves the defense industry. It also has aerospace, medical and heavy-equipment contracts, according to state officials.
To entice Waltonen from expanding in Michigan instead of sites in Washington, D.C. and Wisconsin, the Michigan Economic Growth Authority last week announced it approved a state tax credit valued at $538,770 over four years.
To additionally justify the dangling of tax breaks to companies that purchase or expand buildings, buy new machinery and equipment and add new employees, local and state officials also point to spinoff economic benefits anticipated with any type of corporate project. In this case, the Michigan Economic Development Council estimates Waltonen's project indirectly could lead to 131 additional jobs in the area.
Under the 1974 law, city councils and township boards reviewing corporate tax break requests must review job growth and investment projected in the first two years of any expansion or relocation. The tax abatements of 50 percent on new buildings and machinery can be awarded for up to a dozen years.
Under Warren's tax break criteria -- which factors the dollar value of any investment, the number of new jobs and location of any project -- Waltonen would receive the maximum term.
Although the tax breaks are mostly associated with industrial manufacturers, research and development -- such as Waltonen -- also qualify, Cavaliere said.
Brown, the company president, has been a member of the Warren Downtown Development Authority board of directors for more than 10 years.