The Shakopee City Council will hold a public hearing Feb. 18 to consider granting a tax abatement to Cherne Industries, a plumbing product manufacturer interested in relocating its Minneapolis offices, warehousing and distribution to a 130,000-square-foot building in Shakopee.
The possible office and warehouse site is located between Vierling Drive and Johnson Memorial Drive and is owned by the Economic Development Authority, but is under contract with OPUS, a commercial real estate developer.
“The city has been working with OPUS on attracting higher-wage jobs and corporate headquarters to the Gateway site,” the city memo said.
Cherne Industries is a world leader in pipe plug manufacturing, according to the memo. A proposed contract for private development would provide Cherne a city tax abatement for nine years, at a value that would be capped at about $460,000.
Under the abatement conditions, Cherne would be required to create an additional 50 jobs at its Shakopee facility throughout the next five years, as well as preserve its existing 115 full-time equivalent jobs. The average hourly pay for Cherne employees is in the ballpark of $20 per hour, excluding executive payments and benefits.
In addition to working with Cherne Industries, OPUS plans to build its own speculative office building to the north of the EDA-owned property, which is currently tax-exempt and is not part of the abatement deal, according to the city memo. Separate from this project, OPUS is also working with the Shakopee Planning Commission to seek approval for three commercial buildings in a newly-proposed development at the Shakopee Gravel site. Those buildings would be used for offices, research development, manufacturing and distribution.
In July 2019, Shakopee City Council unanimously approved a $289,000 tax abatement to help KEB America expand its facility.
The agreement was contingent upon the company maintaining its 98 full-time jobs and adding 34 jobs in five years. In the past, Shakopee has also agreed to tax abatements with Entrust Datacard, Shutterfly and Rosemount Emerson.
The public hearing will be held at Shakopee City hall, 485 Gorman St., at 7 p.m.
