Roseville to offer $3 million in tax breaks to lure St. Paul manufacturer

Roseville officials plan to use up to $3 million in tax incentives to attract the new headquarters of manufacturer Colder Products Co. (CPC), which has operated out of St. Paul for years.

The company wants to consolidate nearly 400 employees from three separate facilities around the St. Anthony Park neighborhood into a 150,000-square-foot complex in Roseville on Cleveland Avenue, near the intersection of Interstate 35W and County Road C.

The Roseville site, which long has been home to a truck service center, has contaminated groundwater. The city has been trying to redevelop the area since at least 2005.

CPC has been in St. Paul since 1978 and makes specialized connectors and fittings for plastic tubing used in medical equipment and food distribution. Owned by Illinois-based Dover Corp., it has operations in China and Germany.

Company officials told Roseville City Council members in May that they were going to expand either in the St. Paul area or in China, saying they were worried about the increased minimum wage in Minneapolis. One of its three local facilities is in Minneapolis, just on the other side of the city line from the other two buildings in St. Paul.

CPC officials did not return phone calls Tuesday seeking comment.

The company would immediately move 388 employees to the new headquarters, half of whom would be paid an average of $92,000 a year, according to a proposal CPC presented to Roseville.

Roseville officials have proposed creating a tax-increment finance district (TIF) at the planned site, which would essentially freeze property taxes at their current value for up to 25 years. Rather than pay additional taxes on the rising value of the property after it moves in, CPC would use the money to pay for its expansion.

The city estimates the company would save $2 million in taxes over the 25-year life of the TIF district and has recommended capping the benefits at that amount. Roseville also would offer the manufacturer up to $1 million in additional tax breaks to clean up the site.

The City Council will hold a public hearing on Feb. 25, when it will vote on the TIF district. Mayor Dan Roe said he believes that if TIF is approved, the company would start construction this year.

Roseville follows a set of criteria for deciding when to subsidize businesses. Near the top of the list is the addition of high-paying, long-term jobs, Roe said.

"A corporate headquarters certainly fits, especially when it's in an area like this, that is extremely visible, right on our front door and will help spur additional redevelopment around it," he said.

As TIF properties are improved, critics say, they bring in more workers and families without kicking in more money for the schools, roads and emergency providers that serve them.

Minneapolis once relied so heavily on TIF districts that subsidies ate up 15 percent of its tax base in 2004, before the city started allowing the districts to expire.

Ramsey County officials have refused to use TIF incentives for one of its top redevelopment projects — a 5-acre site on the Mississippi riverfront that has sat vacant for years — saying that putting the land back on the tax rolls is the main reason for seeking the redevelopment.

But a TIF district also levels the playing field when cities are dealing with blighted or contaminated land, Roe said.

CPC, which is also seeking at least $1.3 million in state economic development funds for the expansion, isn't the only manufacturer considering leaving St. Paul for tax breaks being offered by a suburb.

CPC's two St. Paul facilities were within a TIF district created by the St. Paul Port Authority that expired in 2014.