80 new jobs at Borgers to have $3.6 million payroll

Cary Ashby • Dec 15, 2016 at 12:00 PM

Norwalk city council has approved a job-creation grant agreement with Borgers Ohio, Inc., but approval is pending from the German home office.

Council approved the grant agreement Tuesday. Norwalk Law Director Stuart O’Hara said the incentive for Phase 1 is the same as the second phase.

“They now have completed first phase,” he also told council. 

Borgers, according to the grant agreement with Norwalk, hopes to create about 80 new jobs on or before June 30, 2018 with a payroll of $3.6 million.

Based on a projected number of jobs, the amount of the city’s grant will be about $10,800. A previous story was confusing concerning the amount of the grant.

Also, the German automotive supplier plans to make $5.4 million worth of additions and/or new construction and $12 million in machinery and equipment. Also according to the grant agreement, the 80 “new full-time permanent job positions” wouldn’t include any jobs “associated solely with the construction of the project.”

“We are waiting for this approval,” plant manager Jochen Harmeling told the Reflector on Wednesday. “This is part of the decision-making process.”

Harmeling didn’t have a time frame for the approval from the Borgers home office, but said it could be “next month, next quarter” or possibly not go through at all. He said administrators will look at the entire package before approving the expansion.

Borgers in Norwalk currently has about 150 full-time employees and about 70 percent of those workers are from Huron County, Harmeling said.

“It fluctuates,” he added, referring to the number of employees. “We don’t have part-time.”

Heather Horowitz, director of Norwalk Economic Development Corp., said it’s her understanding that Borgers “is waiting for approval from the home office for the expansion to happen.”

“They have their ducks in a row,” she said.

Horowitz explained what the job-creation grant agreement means financially for Borgers and Norwalk.

“The $3.6 million payroll is taxed at 1.5 percent by the city, which is a payroll tax,” she said.

In 2017, Borgers would pay $54,000 in payroll tax for the 80 employees at the $3.6 million payroll. The city of Norwalk will grant them (or reimburse them) 20 percent of the $54,000 within six months of receiving paperwork. They will receive $10,800 from the city,” Horowitz said.

The grant lasts seven years, beginning Dec. 31.

Horowitz said Borgers is required to create the 80 new jobs within three years.

“We don’t expect them to have all 80 in one year,” she added.

In early 2014, it was announced that Borgers USA Corp. chose Norwalk for its second North American manufacturing facility. Norwalk celebrated the grand opening of the Borgers Ohio facility with an Oct. 14, 2015 ribbon-cutting ceremony.

EDITOR'S NOTE: Reporter Ivy Keller contributed to this story.

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