The Owensboro City Commission recently gave preliminary approval for an industrial revenue bond to support Mizkan America’s planned expansion, which represents one of the largest private investments in the City’s recent history.
The $156 million project, announced in July 2024, includes a new 200,000-square-foot warehouse, a 160,000-square-foot production facility, and additional site improvements on the company’s Ragu Drive campus. Mizkan expects the expansion to create 44 new jobs.
City Manager Nate Pagan said the incentive comes through a property tax abatement structured as an industrial revenue bond.
“It’s a little bit of an atypical structure for us,” Pagan said. “Essentially, the bonds function as a property tax incentive for the project. Under this arrangement, the City will technically own the property on which the expansion will sit, thereby making it tax-exempt because the City owns it. However, Mizkan will make payments to the various taxing districts at a negotiated reduced rate.”
The agreement calls for a 75% property tax rebate over 10 years. Mizkan would pay 25% of the property tax it would otherwise owe, while the Daviess County Public Schools system will receive its full share.
Pagan noted that while the City hasn’t used an industrial revenue bond in several decades, the tool was common in past projects such as Dart Polymers in the 1970s and Scott Paper, later Kimberly-Clark, in the 1990s.
“This is slightly different from a typical incentive that we do, but it achieves the same goal,” Pagan said.
The municipal order authorizes up to $210 million in industrial revenue bonds, though they will not be a general obligation of the City. A payment-in-lieu-of-taxes agreement accompanies the plan.
Brad Davis, the City’s community development director, said Mizkan is still finalizing construction plans.
“They’re actually still kind of working through the construction layout and everything,” Davis said. “They’re hoping to start this fall, but I don’t know that that’s written in stone. … We should know later in the fall a more finite time frame.”
A follow-up vote is expected at a future meeting to finalize the incentive package.
