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Marion County Fiscal Court approves Maker’s Mark agreement

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By Stevie Lowery

After nearly an hour of discussion Thursday afternoon between the members of the Marion County Fiscal Court and community members, the fiscal court approved a resolution to enter into a memorandum of agreement regarding issuance of industrial revenue bonds for Maker’s Mark warehouses and the industrial building on Veterans Memorial Parkway (the bypass) in Lebanon. The location of the warehouses will be 512 Brown Forman Road near Raywick.

The vote was as follows:
- Larry Caldwell and Steve Masterson abstained from voting due to a county ethics ordinance, which prohibits them from voting due to family members having involvement in the agreement with Maker’s Mark.
- Craig Bishop: No
- Jackie Wicker: Yes
- John Arthur Elder III: Absent
- Judge/Executive David Daugherty: Yes
The agreement passed 2-1.
Read much more about this in the May 9 edition of the Enterprise.

BACKGROUND INFORMATION

Maker’s Mark CEO Rob Samuels attended a joint meeting between the Marion County Fiscal Court and the Lebanon City Council on Dec. 21, 2017, and asked the county for industrial revenue bonds to build additional warehouses. Magistrates made it clear to Samuels that before the court would be able to make a decision on the IRBs, they would need to know the exact location planned for the warehouses and additional details about the distillery’s expansion.

During that December meeting, Magistrate Jackie Wicker said he was concerned about the mold that the City of Loretto has been dealing with since the distillery built additional warehouses there.

“I think that’s a different topic that we can talk about another time,” Samuels said. “We are sensitive and want to be a good neighbor. We would intentionally purchase land that meets everyone’s expectations for future growth.”

The mold that Wicker was referring to is actually a fungus named Baudoinia. Naturally occurring, Baudoinia germinates on ethanol, the colorless alcohol that can evaporate during maturation, making the area around distillery warehouses a prime breeding ground. The fungus is found around brandy distilleries in France, scotch distilleries in Scotland, whisky distilleries in Ireland, vodka distilleries in Eurasia, and spirit distilleries throughout the U.S. The fungus is referred to by many common names including distillery fungus, distilleries' shadow, whiskey fungus, angels' share fungus and warehouse staining fungus.

Within the past two months, the fiscal court, along with the Lebanon City Council and the Marion County Industrial Foundation, have discussed Maker's Mark's request during several closed session meetings.

During the fiscal court's meeting on April 5, Magistrate John Arthur Elder III took some time to address the subject.

“Nothing has been decided,” he said. “If it is decided, it will be decided in an open meeting. Each and every magistrate, and the judge if he chooses, will vote openly. That’s the law and that’s how we run. We don’t hide from anything.”

Elder proceeded to discuss Maker’s Mark, and the benefits the company provides to the county.  

“Maker’s Mark is a solid company. They’ve been here for a long time,” he said. “Actually, they’re probably one of the highest paying companies we have… There’s a lot of good men and women who work out there. And, they pay a large amount of taxes.”

The starting pay at Maker’s Mark for full-time employees is reportedly $27.50 an hour. If Maker’s Mark does expand and more warehouses are built, Samuels estimated that at least 50 additional jobs would be created. And other industries, specifically, Kentucky Cooperage, which makes all of Maker’s Mark’s barrels, would benefit greatly.

“Let’s be real folks,” Elder said. “You drive by Kentucky Cooperage out here what do you see? It’s packed. They’re going wide open seven days a week. The bourbon industry has grown tremendously, and all the reports show it’s going to continue to grow substantially, which means more jobs… Think about it folks. $27.50 an hour job with insurance and benefits. That is a life changing opportunity for Marion Countians.”

However, before the county can make its decision regarding the industrial revenue bonds for Maker’s Mark, it must know the location of the additional warehouses, Elder said.

“I’m willing to work with Maker’s Mark… but it’s gotta make sense,” he said. “It has to make sense for the community. I do not want Maker’s Mark sitting on top of a subdivision… If there’s a place out there that doesn’t truly affect subdivisions, and so forth, it might be an option.”

And while the location of the warehouses is a concern, magistrates must also consider the additional revenue that would be generated for the county, Elder said. If Maker’s Mark builds 20 new warehouses over the next 10 years, which is what’s currently being discussed, that would generate more than $24 million for Marion County. Here’s how it would breakdown, Elder explained:

• More than $3 million would go to the Marion County Board of Education. (Elder said he would like the county to have some input in how the money is spent by the board of education.)
• $550,000 would go to the county government
• $330,000 would go to to the Marion County Public Library
• $220,000 would go to the Marion County Extension Service
• $165,000 would go to the Marion County Health Department
• $55,000 would go to the Lebanon/Springfield Airport
“I think we have to keep an open mind to opportunity and to the future,” Elder said. “Maker’s Mark also brings a lot of notoriety to Marion County. Anywhere you travel, people know that name… Anything we can do to enhance that, I think we need to look at.”

Magistrates Steve Masterson and Larry Caldwell both commented on how the additional warehouses could have a trickle down affect and draw other industries to the county, creating even more jobs.

“Those are the things that we as elected officials have to take into consideration,” Elder said. “I hope that we do. With that being said, I can assure you again there will be no votes taken, there will be no decisions made unless it’s made in open public for the press and for anyone else that wants to come. And, we will make those decisions based on the betterment of the county… the betterment of the people.”

Magistrate Steve Masterson agreed.

“Industry owes it to the people to grow in a responsible manner,” he said. “The people owe it to the industry to try and let them grow.”

What are industrial revenue bonds?
KRS 103.200 to 103.286 allows cities and counties to issue industrial revenue bonds (IRBs) to finance industrial buildings for private entities. In some instances, the private entity may transfer ownership of the property to the city or county until the bonds mature. During this time, the city or county leases the property to the private entity. While the city or county holds the deed to the property, the property may be subject to a reduced state property tax rate based on the value of the lease and the property may be exempt from local property taxes.