Ace Bayou planning more jobs

Friday, January 7, 2011

The Lewisburg-based manufacturer of pet furniture and recreational seating plans to double its staff if it lands an agreement with the City Council and buys the old Sanford pencil factory property as planned.

It could mean 100 more jobs here at Ace Bayou Corp. that operates from two buildings on Higgs Road in the city industrial park, according to plant manager Will Wilson who described plans outlined by a company owner to Lewisburg's Industrial Development Board on Monday.

"We're the recipient of new business from new retailers in the United States and it requires more square footage than what we have in either facility here," Wilson said. "The owners are in the process of buying the Sanford property."

Demolition of the building owned by Sanford, or more properly Newell Rubbermaid, is complete at the site, generally near where the city will be leasing railroad tracks for a loading area. Ace Bayou will still ship by truck.

The timeframe for Ace Bayou's expansion is "purely contingent upon how the property goes," Wilson said. "There are [normal] environmental aspects to finalize" before the property transfer.

Meanwhile, Lewisburg Industrial Development Director Greg Lowe is scheduled to present a recommendation from the IDB to the City Council on Tuesday. IDB Chairman Eddie Wiles will probably be present, as well, Lowe said.

The IDB is recommending the Council sanction an agreement for Payment In Lieu of Taxes, a so-called PILOT agreement. They're not unusual and have been justified by city leaders as a way to give growing businesses a tax break without sacrificing city revenue that probably wouldn't exist if the agreement were not authorized.

PILOT agreements have been small, like one for the Arby's restaurant on Ellington Parkway, or huge, like the multi-million dollar deal in Rutherford County for the Nissan plant in Smyrna.

Here and now, "They're not sure what the total figure will be," Lowe explained Thursday morning when asked about the Ace Bayou expansion. The dollar amount won't be known "until the deal is finalized," he said.

Wilson said: "We think it's good news for the county."

PILOT agreements struck by the city also result in a county property tax break. It's just the way the system works, according to an explanation by an attorney who at that time was serving as the IDB's attorney.

Wilson anticipates the agreements will "work out."

The proposed PILOT agreement is to last five years, as described by Lowe on Wednesday.

Such agreements include calculations on the value of real estate and equipment that will be acquired by a business for expansion. The property tax rate is applied to the entire amount, but is not charged during the first year. In the second year, a payment is made valued at 20 percent of what the tax bill would be. The payment is not a tax payment. It's a payment in lieu of taxes. That's because taxes must be charged equally.

In later years, the in-lieu-of-taxes payment is increased to 40 percent, 60 percent, 80 percent and then at the end of the five year period, there is no difference in the amount due when compared to the normal tax bill, so the PILOT agreement is concluded.

The IDB recommends a PILOT agreement for equipment and real estate to be acquired by Ace Bayou, officials said.

"We approached him," Wilson said of Ace Bayou's request for a PILOT company officials described to Lowe.

"He's a great ambassador for the community," Wilson continued. "And very easy to work with."

Ace Bayou has about "100-plus" employees at its two facilities, he said.

Doubling the company's workforce here "would be the anticipation," Wilson said of the company's plans.

Ace Bayou had a plant at Petersburg where beanbag chairs were manufactured. The business was moved to a larger building in Lewisburg. Pet furniture - beds for cats and dogs, and clawing towers covered in carpet with places for cats to hide - were made in a building in downtown Lewisburg. In recent years, the company moved that operation to the industrial park.

Ace Bayou also makes game chairs, suitable seating for those playing electronic games.

The owners of the company are Richard Davis and Murray Valene; both live at New Orleans, La.