ONYERS, Georgia (From news reports) -- The Rockdale County Development Authority has agreed to issue $70 million in taxable revenue bonds for an expansion at Pratt Properties II LLC and Pratt (JetCorr) LLC.
Of the total amount, $26.5 million will fund real property and $43.5 will go toward equipment for the 300,000-square-foot expansion.
Under the agreement, the bonds will be repaid with revenues generated by Pratt. The company will receive an abatement on county property taxes for the next 10 years, although school taxes will not be abated.
Tax abatements are typically used to induce a project to invest in a community and are achieved through the issuance of "phantom bonds." The process involves a government entity, in this case the authority, taking title to the project, then issuing bonds and leasing the project back to the developer, in this case Pratt. The developer then pays rent to the governing entity, and those funds are used to pay debt service and repay the bonds. The title transfer and "phantom bond" process are necessary because taxes cannot be abated on private property.
Authority attorney John Nix said the project at Pratt has been in the works for three years and has already been completed.
Greg Hlozek with Pratt Industries said the project is a multi-million dollar investment in Pratt's main Conyers campus.
"The expansion includes additional state-of-the-art box-making equipment, further strengthening the company's ability to provide the great service, quality, selection and flexibility that Pratt is known for throughout the corrugated packaging industry," said Hlozek in a released statement. "The expansion is expected to add more than 100 new jobs to the area."
Pratt is America's fifth largest corrugated packaging company and the world's largest, privately-held 100% recycled paper and packaging company, with more than 10,000 highly-skilled, green-collar employees, according to Hlozek. The company is dedicated to environment sustainability, its customers and its people, he added. The cornerstone of Pratt's mission is to protect and nurture the planet's natural resources while reducing its impact on the environment.