- April 25, 2024
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A classic car parts company is relocating from Connecticut to Palm Coast, and the city is proposing to offer up to approximately $60,000 in tax breaks as an incentive.
The company, called Ground Up, was formed in New York, first selling hard-to-find car parts at meets, then relocated to Connecticut, where it’s now outgrown its 40,000-square-foot facility. Ground Up wants to move to Palm Coast and open a 70,000-square-foot facility here, hiring 30-40 workers when it opens.
"It’s a low-impact business for us, and would add significant jobs."
— JASON DeLORENZO, Palm Coast chief development officer
“Ground Up is truly an American success story,” Jason DeLorenzo, Palm Coast’s chief development officer, told Palm Coast City Council members at an Oct. 12 council meeting. “They’re an e-commerce company, and they distribute GM muscle car parts. ... What they are going to do is get their operation running here … and then the call center will move here as well, and then they will close their operations in Connecticut.”
He added, “It’s a low-impact business for us, and would add significant jobs.”
The company, founded in 1990, has experienced more that 10% growth each year for the past two years, DeLorenzo said.
"I think any time that we’re bringing jobs and economic opportunity to our city, it’s a success."
— NICK KLUFAS, city councilman
City staff have been in discussions with the company since January, when its leadership approached the city about buying a property at 2 Commerce Boulevard that formerly housed Palm Coast Data, and, before that, the old Palm Coast City Hall.
Ground Up has since invested $4 million in buying and renovating that property, and has asked city staff if the city has any economic incentive programs for businesses.
So, to support the company’s decision to move to Palm Coast, city staff have proposed using a grant structure known as a “recapture enhanced-value grant” that would give the company an overall property tax reduction equivalent to up to 75% of its property tax rates for its first five years as long as it meets certain benchmarks, including creating and maintaining at least 25 jobs and remaining in Palm Coast.
The city portion of the company’s 2021 ad valorem property taxes would be $12,912.
The company wouldn’t get the money up front: Instead, it would pay its property taxes normally for one year, then be reimbursed the next year. There would be restrictions on how the grant money could be used.
“They can only use the grant on expenses that were designed to be recaptured in the community,” DeLorenzo said.
It could be reinvested into the company’s Palm Coast facility, used to host a car show, used to sponsor or take part in city events, used to promote traffic safety programs, or used to sponsor STEM or technical education programs in local schools.
Ground Up is currently hiring and plans to become operational in November or December, DeLorenzo said.
City Council members were in favor of using the incentive program.
“How can we herald the fact that we’ve got these people coming, and we want more?” Mayor David Alfin asked.
City Councilman Nick Klufas also supported the proposal, and said he preferred the recapture enhanced-value grant to incentive programs that simply provide companies with cash to relocate.
“I think any time that we’re bringing jobs and economic opportunity to our city, it’s a success,” Klufas said.
The council will vote on the proposed incentive program during a future City Council business meeting.
