By Lorie Hailey and Mark Green
The Lane Report
FRANKFORT, Ky. (April 26, 2012) — Several significant economic development projects were approved for tax incentives today at the monthly meeting of the Kentucky Economic Development Finance Authority (KEDFA).
Among those are expansions of the Toyota plant in Georgetown and manufacturing facilities in Hebron, Louisville, Jenkins and Franklin. Other projects include the revitalization of an amusement and water park in Louisville, as well as a student housing development project in Lexington. KEDFA also gave final approval to a changes to an expansion project at GE in Jefferson County.
Franklin Precision Industry in Simpson County plans a total investment of $50.6 million for expanded production, warehousing and manufacturing support operations at its existing automotive supply facility.
Auto parts maker Franklin Precision Industry was established in 1989 and is owned by Aisan Industry Co. Ltd. of Obu, Japan. It can avoid $2.65 million in tax payments during the next 10 years by maintaining a base employment of 471 Kentucky resident full-time workers. Simpson County has an unemployment rate of 10.2 percent, according to state incentive documents.
The project will add 113 jobs at an average hourly rate of $16.65, including benefits.
Toyota Motor Manufacturing Kentucky is planning a $32 million expansion to its Georgetown facility.
The proposed project would add a new engine assembly line, and would add 86 jobs over the course of 10 years. The average hourly rate of the new jobs would be $25, including employee benefits.
The company anticipates that it will spend $2.2 million on building/improvements, $23 million on equipment, and $5 million on other start-up costs.
KEDFA approved a $6.5 million tax incentive for the project.
Ferus Corp., an energy services company based in Denver, is planning the construction of a 20,000 to 30,000 s.f. addition to its Jenkins plant.
The $31 million investment would build a warehouse/storage facility to deliver liquid nitrogen to plant storage, customer yard storage or directly to well sites, according to a KEDFA project description. The plant also would add 34 new jobs — paid an average hourly rate of $20, including benefits — over the next 10 years.
Ferus estimates that it will spend $300,000 on land, $21.7 million on building/improvements and $8.7 million on equipment.
The company will avoid $2 million in tax payments over the next 10 years.
ZF Boge Elastmetall
ZF Boge Elastmetall LLC is planning a 52,000 s.f. expansion of its manufacturing facility in Hebron. The company produces bushings, engine mounts and plastic components for the automotive industry.
A $500,000 tax incentive was approved for the $18 million project, which would add 60 jobs — paying an average of $21 per hour, including benefits — over the next 10 years.
The company estimates that it will spend $12 million on equipment and nearly $6 million on rent.
KEDFA approved Café Press Inc. for up to $10 million in tax incentives for up to 10 years.
Café Press, one of the world’s largest producers of customized and personalized products, is planning an approximate 185,000 s.f. expansion of its 140,000 s.f. production and fulfillment center in Louisville’s Riverport. The company also is considering moving its corporate headquarters from northern California to Louisville.
Within the first three years of operation, the company has estimated a total investment of $8.5 million in building materials and capital equipment. It plans to add 592 jobs with a total payroll of $22.4 million by the second quarter of 2015.
Heaven Hill Distillleries Inc. is planning the renovation of a building at 528 W. Main St. in Louisville to use a working distillery to manufacture Evan Williams Bourbon and other products.
The $9.5 million project will include full restoration of the building and will “be an integral addition to the ‘Bourbon Row’ district of distilleries in Louisville,” according to a project description submitted to KEDFA.
Heaven Hill plans to add 14 new jobs with a total payroll of $655,200 by 2014.
KEDFA approved the company for up to $280,000 in KBI incentives and $200,000 in KEIA incentives for up to 10 years.
The incentive package for General Electric Company, which has undertaken a $150 million expansion of its manufacturing plant in Jefferson County, was amended Thursday.
GE Appliance has invested in its Alliance Park facility to produce hybrid electric hot water heaters. Its expansion project now includes installing equipment to manufacture up to 300,000 water heaters each year, as well as components used in dishwashers and refrigerators produced in Alliance Park.
Preliminary incentive approval was given in 2009 to the project, which initially was a nearly $70 million investment, adding 420 jobs. KEDFA gave final approval Thursday to the amended project, which is a $150 million investment, adding 851 new jobs. The added jobs will have average hourly wage of $27.61, including benefits.
With KEDFA’s approval, the company will avoid $20.5 million in tax payments for the next 10 years.
Student development, amusement park incentives approved
Hallmark Student Development LLC will build a $28 million, 272-unit student housing project less than a half mile from the University of Kentucky campus in Lexington under the terms of an amendment to previously approved incentives TIF project.
State economic development officials Thursday approved a change in the terms of tax incentives for the Red Mile Mixed-Use Revelopment Tax Increment Financing Project. It expands the TIF project’s development area by 21 acres so land can be sold for the planned student housing development.
The amendment cuts nearly in half from $25.3 million to $13.8 million the amount of TIF money developers can recover if Instant Racing is deemed an “ineligible activity” in the future. Additionally, it states there can be no TIF recoveries until minimum capital investment spending of $20 million has been verified.
TIF recoveries apply to the cost of portions of a project that are classified public infrastructure. The TIF development footprint encompasses 92 acres with the 21-acre expansion.
The overall Red Mile Mixed-Use Redevelopment TIF Project investment is anticipated to be $186.9 million. The land proposed for sale to Hallmark Student Development is available because of diminished use of the Tattersall’s sales arena and barns. The student apartment development would not qualify for TIF recovery but will count toward the minimum required capital investment.
The former Kentucky Kingdom amusement park in Louisville will reopen for operation in May 2013 under the terms of a small state tax incentive granted in Frankfort. The state will forego $17,032 in taxes on building construction materials and fixtures that are part of an expected $24 million investment by Bluegrass Boardwalk Inc.
Bluegrass Boardwalk’s primary principals are Natalie and Daniel Koch of Santa Claus, Ind., who own and operate the Holiday World amusement park there. They created the new entity for the purpose of revitalizing and reopening the amusement and water park adjoining the Kentucky Exposition Center as a tourist destination.