Aero Foil International receives city of Muskegon tax abatements for expansion
Published: Tuesday, April 24, 2012, 8:25 PM Updated: Tuesday, April 24, 2012, 8:27 PM
MUSKEGON, MI – A home-grown machine shop continues growing with the industrial property tax abatement support of the city of Muskegon.
Air Foil International Inc. Tuesday received two separate tax abatements for equipment purchases for its AFI Machining and AFI Hole Drill operations at 1929 Port City Blvd.
The $1.7 million investment will create four jobs but the company has plans to expand its current workforce of 34 to 75 or 80 in the next three to five years, according to Jim Kutches – son of AFI President Steve Kutches.
The company was founded in 2004 to serve the machining needs of the makers of jet engines and land-based gas turbines. The company was before the Muskegon City Commission in 2009 at the height of the Great Recession for tax abatements on a $1.8 million investment that created six jobs.
The current request, approved unanimously by commissioners Tuesday, was for a six-year, 50 percent tax abatement on $1.1 million in personal property for AFI Machining. AFI Hole Drill received a six-year, 50 percent tax abatement for personal property valued at $599,800.
The company will realize annual tax savings over the course of the year estimated at $19,260. The local taxing units will still receive an estimated $14,260 annually in new taxes, according to city officials. The four jobs will generate another $640 in new city income taxes, they said.
The company has historically done work for Alcoa Howmet Castings in Whitehall, makers of turbine blades and vanes for jet engines for the aerospace industry. AFI also has had contracts with turbine engine makers General Electric, Rolls Royce, Siemens and Pratt & Whitney, company officials have said.
AFI has been a member of the state tool and die low-tax “renaissance zone,” receiving assistance that has led to its expansions, Steve Kutches has said. The Muskegon Tooling Alliance of Western Michigan is a group of seven area industrial companies which have banded together to support each other’s business and gain the low-tax benefits of the state RenZone.