Two more in line for Tucson business incentives

2013-12-08T00:00:00Z 2013-12-08T18:48:12Z Two more in line for Tucson business incentivesBy Darren DaRonco Arizona Daily Star Arizona Daily Star

Two Tucson companies moved a step closer to picking up financial inducements to expand in the city.

Modular Mining Systems and a developer working on a new headquarters for Mr. Car Wash were both green-lighted by the City Council on Monday.

Both are in line to receive a waiver for building permit fees and construction sales tax credits. The Mr. Car Wash project is also seeking a reprieve of up to eight years on property taxes.

While both projects’ incentives were considered on Monday, they are at different stages in the city’s business incentive program.

The Mr. Car Wash project got the go-ahead to enter stage two of the program. It will now undergo an independent analysis to determine if the $4 million renovation of the long-vacant First Baptist Church education building, at 222 E. Fifth Street, is worth it to the city.

In order for the project to qualify for tax abatement, the analysis must show the benefits to local municipalities exceed those received by the developer to ensure the taxpayer assistance really does benefit the public .

The former church building was purchased recently by developer Michael Wattis.

Wattis has a 12-year, three-month lease with Mr. Car Wash.

The move means the company will be able to hire an additional 40 employees with salaries averaging $80,000 a year.

Mr. Car Wash employs 72 people at its current Pima County headquarters.

City staff will return to the council at a later date with the results of the financial analysis and then council will vote on whether to move the project to the next step or nix the incentive.

Modular Mining Systems is now at the final stage. The council approved the drafting of a development agreement after an analysis by Tucson Regional Economic Opportunities showed direct and indirect revenues to local municipalities would be around $1.2 million over three years.

Modular Mining purchased a 31,000-square-foot building near its current headquarters at 3289 E. Hemisphere Loop.

The building, 3285 E. Hemisphere Loop, will be renovated into a research and development and technical support center, city records show.

The $10 million expansion is projected to allow Modular Mining to hire an additional 25 employees with average salaries above $60,000 a year.

While the final numbers aren’t in for its incentive, Camila Martins-Bekat, the city’s economic development specialist, said the company is likely to receive around $24,000 in construction tax credits and about $12,000 in waived building permit fees.

Martins-Bekat said the company is likely going to apply its construction tax credits toward job training programs for its employees.

The two companies are the latest to benefit from the city’s nearly 18-month-old Economic Development Office.

The office was created in June 2012 to streamline the process for developers and businesses to apply for economic incentives to stimulate growth downtown and elsewhere.

Over the first 12 months of the program the office identified $12.8 million in business incentives for seven projects.

In return, the city, county and other taxing districts are expected to pick up a combined $24 million in estimated revenue from the seven projects over eight years.

The projects also represent about $100 million in capital investment within the city and 540 permanent jobs.

Contact reporter Darren DaRonco at 573-4243 or ddaronco@azstarnet.com. Follow on Twitter @DarrenDaRonco

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