UPDATE: The Charles City Council on Monday approved a $1.85 million incentive package to assist Zoetis, Inc. with a $55 million expansion of its local plant.

The local incentive is estimated at almost $1.85 million and would come in the form of an eight-year, 90 percent property tax rebate through the Southwest Bypass Tax Increment Financing District.

Zoetis has also received state incentives.

The expansion is expected to add six jobs at a wage level of $16.83, according to state documents.

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PREVIOUS STORY: Zoetis, a global animal health company, is planning a $55 million expansion to its Charles City plant with state and local government help. It will add more manufacturing capacity while adding six jobs.

The City Council is being asked to support a roughly $1.85 million incentive made possible by a long-established joint tax-increment financing district.

“The project is estimated to be a $55 (million) investment to their existing plant location which includes $21.9 (million) in new building construction, $6.9 (million) in remodeling and $25.2 (million) in machinery and equipment,” City Administrator Steve Diers wrote in a memo to the Charles City Council. “Zoetis has been awarded financial assistance from the state of Iowa and is seeking assistance from the city of Charles City.”

According to Diers, the state incentives include:

• $1.62 million in tax credits,
• $864,000 in sales tax credits
• $15,000 in research activities credits and
• $20,000 in job training funds.

The local incentive is estimated at almost $1.85 million and would come in the form of an eight-year, 90 percent property tax rebate through the Southwest Bypass Tax Increment Financing District.

The Iowa Economic Development Authority approved the Zoetis application for state incentives in October 2017, according to Diers. That same month, the SW Bypass Board recommend that the City Council and the Floyd County Board of Supervisors approve the tax rebate.

“We are thrilled that Zoetis has chosen Charles City and look forward working with them on this expansion,” Diers said.

The council will take up the issue at its meeting Monday, March 19, which begins at 6 p.m. at City Hall.

The Zoetis project was one of five announced in October by IEDA as being awarded financial assistance and tax benefits through state programs.

“These awards will assist in the creation of 43 jobs, retention of seven jobs and will result in over $76 million in new capital investment for the state,” the news release said.

The Zoetis project taps the state’s High Quality Jobs Program and is expected to create six jobs incented at a qualifying wage of $16.83, according to the release.

The Floyd County Board of Supervisors voted in November to support the TIF district incentives.