A biotechnological company based in downtown Franklin will save tens of thousands of dollars after the city agreed to give it a tax break on a new piece of equipment.
Franklin’s city council voted to grant B2S Life Sciences a seven-year tax abatement on a new piece of equipment worth nearly $1 million.
The equipment, valued at $882,845, will be used to increase the company’s capacity, develop new capabilities, and for research and development. In all, the tax break will save the company about $41,000 over the life of the abatement, according to city documents.
The company is slated to pay no taxes on the new equipment the first year, with taxes gradually increasing until the company is paying full taxes on it once the abatement ends.
For example, the second year, the company will pay $2,420 in taxes. It will pay $3,509 the third year. When it’s all said and done, the company will have paid $28,387 in personal property taxes, city documents said.
As part of the deal, the company will be charged a 5% economic development fee. Money from economic development fees have been used to pay for alley improvements, holiday lighting and to start a shared work space, Krista Linke, Franklin’s community development director has said.
Offering tax breaks encourages business growth and expansion, which B2S is looking to do, Franklin mayor Steve Barnett said.
“You want to encourage the high paying jobs and be business friendly,” he said.
The company has added employees more quickly than its original abatement called for. It has 29 employees, significantly higher than the 12 employees they were required to have by this time as part of the deal. About 10 more employees with average hourly wages of $40 are expected to be added, city documents said.
B2S Labs bought the property at 97 E. Monroe St., from the Franklin Development Corporation for $75,000, and has completed renovations on the building. Now, it’s looking to expand, city documents said.
The city’s redevelopment commission provided $250,000 grant to B2S Labs through an Economic Development Agreement, although they are paying part of that back, Linke said.
The company was also given a $50,000 facade grant, and received a three-year vacant building property tax deduction at 100%. That expired last year, city documents said.
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Here is a look at the taxes B2S Life Sciences in Franklin will be expected to pay on a new piece of equipment given the city council’s approval of a seven-year abatement:
Year 1: $0
Year 2: $2,420
Year 3: $3,509
Year 4: $3,964
Year 5: $4,926
Year 6: $6,136
Year 7: $7,432
Total paid: $28,387
Total savings: $40,474.91