An income tax credit plan for Ruralogic, a start-up information technology firm that will bring new jobs to Archbold, was approved by Village Council at its Monday night, Oct. 25 meeting.
Dennis Howell, Archbold village administrator, said the firm has committed to remaining in Archbold for 10 years.
During the first two years, the company will collect income taxes from employee paychecks, then forward the money to the Village of Archbold. Howell said the village will then refund 80% of the tax revenue back to the company.
For the next two years, 60% of the income tax revenue will be returned to Ruralogic, then for the next four years, the company will get 40% of the income tax revenue returned.
Or, as another option, the company could take the refunds as corporate profits tax credits. However, Howell said he doubts Ruralogic will follow that route.
If the company fails to honor its commitments, Howell said there is a “claw back” clause in the agreement with Ruralogic. If they fail to meet the requirements, the village can collect, or claw back, what it had refunded to the company.
Howell said currently, the first group of Ruralogic employees is undergoing training at Northwest State Community College. They should complete training by the end of the year.
The first new employees should be on the job in Archbold in 2011.
Right now, Howell said company officials are doing some rewiring in the office space they have rented and are acquiring the necessary computer equipment the firm needs.
Archbold has agreed to loan $400,000 to Ruralogic as part of the economic development package.
The money is coming from the village general fund and is being routed through the Archbold Community Improvement Corporation, which will officially lend the money to the startup company.