AVON LAKE — The Ohio Tax Credit Authority on Monday approved a 15-year, 50 percent job retention tax credit deal for Ford Motor Co. on the eve of today’s announcement to bring a truck line from Mexico to the Ohio Assembly Plant in Avon Lake.
Avon Lake Mayor Karl “K.C.” Zuber confirmed the approval late Monday afternoon following a meeting of the Tax Credit Authority, which he attended in Columbus.
The tax credit is not to exceed $1 million a year, Zuber said.
Today, top Ford officials, Gov. John Kasich and leaders of the United Auto Workers held a 9:30 a.m. news conference to address the long-range plans for the facility, which straddles Avon Lake, Sheffield and Sheffield Lake.
“This will aid in retaining the jobs we have now at the Ford plant,” Zuber said of the job retention tax credit. “This is something that has been in the works for some months, if not years, between Ford and the state of Ohio, and it culminates with this approval today.”
A release from the Ohio Tax Credit Authority late Monday confirmed the board’s approval of the job retention tax credit, which will be refunded on the plant’s $58 million annual payroll.
As part of the agreement, Ford is required to maintain operations at the project site for at least 18 years.
The Avon Lake plant presently turns out the E-Series van, which is expected to be phased out by Ford by 2014.
The brief state announcement indicated the credit would help retain about 1,400 jobs at the plant — about 300 fewer than the roughly 1,700 jobs there now, according to Tim Rowe, chairman of UAW 2000 at the Ohio Assembly Plant.
“That’s news to me,” Rowe said Monday when told of the lower figure. “I have no information on that until we hear what’s going on in the morning.”
The tax credit takes effect Jan. 1, 2014.
Nick Gallogly, the former chairman of United Auto Workers Local 2000 from the Ohio Assembly Plant who secured a promise from Ford for a new product and who now works as a national UAW representative based in Detroit, surmised that the lower number may apply to the number of jobs that are expected to be directly tied to production of the F-650 and F-750 truck lines, which are the vehicles now made in Mexico.
The remaining 200 to 300 workers at the plant may be those who may end up working on motor home chassis assembly that is to be relocated from another Ford plant, he said.
“This was a process that took a number of years and a lot of dedication by the people at Ohio Assembly, the UAW and Ford Motor Co. to make happen,” Gallogly said Monday. “But it also took the state of Ohio, county officials and others to get this done. A company just doesn’t decide to move a product line and it happens.”
Zuber said Ford’s future is now tied to Northeast Ohio for some time.
“This shows Ford has made a commitment to Ohio Assembly for an extended period of time,” Zuber said. “And that (the plant’s future) was in question for some time. This is great news.”
“This is a very significant development due largely to the UAW working with Ford to make it all happen,” Rowe said. “That work, as well as whatever Gov. Kasich and Ford will tell us Tuesday, are just that much more bonuses to help get us where need to be in terms of improving the overall health and profitability of the plant.”
At the time that Ford’s roughly 41,000 unionized workers ratified a new four-year contract in October, it was reported that Ohio Assembly Plant would see a $128 million investment to bring production of the truck lines to town, as part of an announced $16 billion investment by Ford into its American operations, and the hiring of 12,000 new workers through the year 2015.
During the Tax Authority Board meeting, it was said that Ford would be making a minimum $75 million investment in Avon Lake, according to Zuber.
Rowe said he was not overly concerned about the disparity in figures.
“If they’re saying $75 million at a minimum, and we were told earlier that the amount was $128 million, that says to me it (money) could go up to $128 million,” Rowe said. “I’ll take $75 million anytime. We’ll just wait and see what they tell us.”
Both Rowe and Zuber agreed that returning major production work to American plants is a very noteworthy development.
“This shows that Gov. Kasich and the state mean business when it comes to creating and retaining jobs, and to keep the plant here and keep it viable far into the future,” Zuber said.
Today, Zuber faces off in a runoff for mayor against Avon Lake Council President Greg Zilka. The runoff was mandated after none of the three candidates on the ballot in November secured more than 50 percent of the vote.
Zuber said while the timing is nice, the news from the major employer is better.
“Major plans by Ford, at any time, are much more important than any election,” Zuber added.
Ford Motor Co. spokeswoman Marcey Evans declined to comment on the tax credit deal or today’s announcement.
Final approval of Ford’s plans for the Avon Lake plant are expected to come sometime next year when a decision is made by the automaker’s board of directors.
“I would expect those new vehicle lines to come within the next 18 months,” Zuber said.
Contact Steve Fogarty at 329-7146 or firstname.lastname@example.org.