The Ohio Tax Credit Authority voted Monday, Dec. 10, 2018, to approve an 8-year, 1.362 percent tax credit for Kroger’s $55 million robot-powered facility in Monroe. The project, a partnership with British online grocer Ocado, would be America’s first automated warehouse and Kroger’s first customer fulfillment center. CONTRIBUTED
Photo: Provided
Photo: Provided

Kroger, Ocado score $1.4M tax credit for location in Monroe

Ohio Tax Credit Authority’s voted to approve an eight-year, 1.36 percent Job Creation Tax Credit for the Monroe project, which would be Kroger’s first customer fulfillment center, or CFC. It is expected to generate at least 410 jobs by the end of 2023, resulting in nearly $19 million in annual payroll, or an average of $46,271 per salary.

As part of the tax credit agreement, which is valued at $1.4 million, the authority requires Kroger to maintain operations at the project location for at least 11 years. The facility is projected to open by 2021.

FIRST REPORT: Kroger’s robot-powered warehouse to create over 400 jobs in Monroe

Known as a “shed,” the 335,000-square-foot facility with digital and robotic capabilities will be designed by Ocado. Earlier this year, Kroger and Ocado announced an alliance to bring Ocado’s “unparalleled innovation and technologies” to the United States. In October, the companies signed a master services agreement to further solidify their partnership.

In November, Kroger and Ocado announced they had selected Monroe for the first warehouse/distribution facility.

Monroe officials said they could not comment on pending projects in the city, which straddles Butler and Warren counties.

The city recently has attracted scores of companies to both areas and with them thousands of new jobs. That includes Amazon, Hayneedle and Blue Buffalo locating operations inside of fulfillment centers that are hundreds of thousands of feet in size. It also includes the expansion of existing companies, such as UGN Inc. and Deceuninck North America.

MORE: Kroger partners with e-commerce company to build new fulfillment centers

Monroe’s central location on the I-75 corridor, incredible access to workforce talent throughout the region, and modern infrastructure supports our growing businesses and resonates with potential projects,” said Jennifer Patterson, the city’s assistant to the city manager for economic development. “Monroe businesses support the region by providing job opportunities in a variety of industries, and we’re excited to continue to work with those companies moving forward.”

Still pending before Monroe City Council are local incentives, namely an agreement for a Community Revitalization Area tax abatement. If approved by council Tuesday, it would provide a 50 percent tax abatement for 10 years on all real property improvements for the project.

Monroe officials said they anticipate Kroger will make a location decision when the incentive processes are complete.

MORE: Monroe vice mayor: ‘Kroger doesn’t need a tax break on the backs of taxpayers’

Kroger, which did not immediately reply to a request for comment, previously said it plans to open 20 CFCs to support what it referred to as its “seamless vision.”

The CFC will introduce innovative robotics technology, allowing for next-generation automated storage and retrieval, the company said.

Monday’s vote doesn’t grant an actual tax credit, but a performance-based credit, according to Lisa Colbert, a spokeswoman for Ohio Development Services Agency.

The value of the tax credit is based on jobs created and new payroll tax generated, as verified, Colbert said.

Monday’s vote means that for eight years Kroger can write off 1.36 percent of payroll it creates via new jobs at the project location.

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