By TOM TIGANI
Sunday Times Newspapers
SOUTHGATE — The Michigan Economic Growth Authority on Wednesday approved a tax break for a local company that is expected to lead to the addition of 125 new jobs.
Bloomfield Hills-based AJM Packaging Corp., which makes paper products including plates, cups, bowls and bags, will use the state tax credit of $564,772 to help expand its facility at 11800 Reeck Road. The company recently expanded its product line to include items prepared for restaurants, a move that officials said will require a substantial increase in overall production capacity.
AJM will invest $28.3 million to expand and upgrade its manufacturing plant in the city, creating 125 jobs. City officials have said the expansion ultimately could result in the creation of 200 total jobs.
The company has proposed a $7 million expansion of the facility, as well as $20 million in personal property acquisition. In an effort to secure their investment, company officials applied for and earlier this month received a tax abatement from the City Council valued at 50 percent of the real and personal property associated with the expansion.
Since opening the Southgate facility four years ago, AJM had been operating on a 50 percent tax exemption for industrial facilities, with the city collecting about $570,000 in taxes after the council created a plant rehabilitation district. With the renewed certificate of abatement officials expect to collect more than $2 million over the next 12 years.
City officials have said AJM’s recent announcement is a coup for Southgate, as the company had been considering expanding a facility in New Jersey. In published reports they also have said that the company, which currently rents
office space for its headquarters, is mulling a possible move of its main office to Southgate, bringing some 72 executive-level jobs to town.
Bryce Kelley, Wayne County development officer, attended the Nov. 3 public hearing at which the council granted the abatement. He called AJM’s announcement a “very serious commitment” at a time when it easily could find existing buildings for much less than new construction costs.
He commended Southgate officials’ ability to “understand what it takes to support the business community.”