Schmalbach-Lubeca Plastic Containers U.S.A. Inc.'s Franklin, Ind., facility has received a 10-year tax abatement for a $20 million expansion. Within the next six months the company plans to build an 80,000-square-foot, $5 million addition and fill it with $15 million worth of equipment. The expansion will create 30 new jobs. Schmalbach-Lubeca currently employs 103 at the plant.
The expansion is part of Schmalbach-Lubeca's restructuring plan, said Shelley Steele, marketing director for Schmalbach-Lubeca.
"The plant is well located and the operating costs there are favorable," she said in a telephone interview. "We will relocate some existing business to be closer to customers and expand to serve new customers."
The abatement request, which was granted Dec. 13, initially presented the Franklin Economic Development Commission with a dilemma.
First, the commission had to define the term "new equipment" as it is included in the state statute on abatements. Schmalbach-Lubeca wants to move blow molding equipment worth $10 million from its Novi, Mich., plant to Franklin. The equipment has been in use for two to three years and, therefore, is not out-of-the-box new. However, it is new to the Franklin facility.
The second sticking point was whether this was a first abatement request from a new company or an old company requesting its second abatement, which is not allowed. Schmalbach-Lubeca purchased Johnson Controls Inc.'s Plastic Container Division in 1997. JCI had obtained a tax abatement from 1990-1996.
After an on-site inspection, the commission recommended to the City Council that it grant the request.
The plant blow molds heat-set bottles for the juice, carbonated soft-drink and water markets and is adding wide-mouth, heat-set capability.
Schmalbach-Lubeca Plastic Containers U.S.A. placed fourth in Plastics News' North American blow molders ranking with estimated 1998 sales of $629 million. The company, based in Manchester, Mich., employs 2,500 at 14 plants. It is a unit of Schmalbach-Lubeca AG of Ratingen, Germany.