HILLSDALE — After much debate back-and-forth between city staff, the Hillsdale City Council and Drew Homovec, the owner of Corecoyle Composite LLC, a decision was made to pass a resolution asking the Michigan Tax Tribunal to revoke an Industrial Facilities Tax Exemption for Homovec’s business in Hillsdale’s Industrial Drive.
In June, city staff had recommended for a third time to pass a resolution requesting the state revoke a 12-year tax abatement previously approved by the council in September 2017 that allowed for a freeze in property tax rates in order for that funding to be used to help kickstart Corecoyle Composite LLC into production.
Homovec, during previous efforts to convince the council to support the abatement revocation due to manufacturing not yet commencing, told the council that storm damage to the building’s roof (located at 221 Industrial Drive) and its repairs landed him in court due to the roof being inappropriately repaired causing a delay.
The COVID-19 pandemic’s onset in March 2020 caused further delays and Homovec finally prevailed this February in civil court against the initial roofing company brought in to repair storm damages, yet he has not yet been reimbursed court assessments owed to him from the civil suit.
For these reasons, the council deemed previously that the situations were out of Homovec’s control.
Monday’s public hearing was brought on by an ongoing review of the facility after Homovec promised the council to be in production by this time last fall.
The council had adjourned the public hearing from June in favor of touring the facility last Tuesday, July 9, but that tour never happened as Homovec demanded the council members entering his facility sign a non-disclosure agreement that the city counsel recommended against due to their inability to publicly discuss the matters Monday if they signed.
On Monday night, Homovec said that he was disappointed the tour had been canceled by City Manager David Mackie and that he felt the NDA was necessary to protect his intellectual proprietary information and manufacturing processes.
“I have attempted to cooperate, but what it’s really boiling down to is that the city management is selectively misinterpreting some of the dialogue and the content of the IFT agreement as well as some of the statutes provided by the state of Michigan,” Homovec said. “This should be a city that is trying to develop and nurture businesses in the city not throw us away and kick us to the curb.”
The council disagreed, countering that while Homovec was supposed to begin manufacturing in 2020, the matters were not brought before the council until 2022 and the council granted numerous extensions to allow Homovec to produce evidence to support his claims of rehabilitating his facility and hiring employees to begin manufacturing.
“From my own perspective, I think we’ve been played,” Councilman Tony Vear said. “The tipping point for me was the NDA.”
Councilman Gary Wolfram was the sole nay vote when the council took up a motion to revoke the IFT agreement. Councilman Rob Socha was absent.
Homovec will now have the ability to appeal directly to the Michigan Tax Tribunal before the IFT agreement is officially revoked.
Two2One LLC purchased the property — located at 221 Industrial Drive — on December 15, 2016 after the city council adopted resolution 3258 to establish a plant rehabilitation district encompassing the property on Jan. 4, 2016.
Corecoyle Composites LLC began rehabilitation on the facility — previously owned by Daisy Parts/Eagle-Picher Automotive — on March 1, 2017 with a projected end date of Dec. 15, 2020.
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The total cost of the building and improvements reported by Corecoyle Composites LLC is $1,308,638.
Corecoyle Composites LLC looked to produce 60-inch-wide composites with the primary equipment already on site, according to Homovec.
Homovec previously said that if the abatement was revoked, he could not begin manufacturing at all.
— Contact Reporter Corey Murray atcmurray@hillsdale.net or follow him on X, formerly Twitter: @cmurrayHDN.
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