LOGAN COUNTY : Plan in works to help Booneville, Beebe says
Posted on Tuesday, April 8, 2008
Gov. Mike Beebe said Monday that state and local officials are developing an incentive package for Cargill Inc., an international food and financial firm with total revenue of $ 88 billion last year, to rebuild its Booneville plant.
The plant employed about 800 people and was destroyed by fire on March 23.
“We have put together a proposal to aid and assist that company building back right there,” Beebe told a meeting of the Political Animals Club at the Governor’s Mansion.
He offered no details of the state’s plan but defended the practice of offering payments from tax dollars to companies and tax breaks to businesses.
“It’s necessary to compete with other states,” Beebe said. “It’s the second-best expenditure of your tax dollars. No. 1 is education.” The governor said Booneville and Logan County were offering incentives of property-tax breaks and free land.
Mayor Jerry Wilkins said in a telephone interview later that the city has offered two tracts of land, one adjacent to the former plant that is 35 acres and valued at $ 175, 000 and another 240-acre piece valued at about $ 1 million.
Both pieces of land are owned by the Booneville Industrial Development Corp., a city agency.
He also said the city has offered about $ 200, 000 worth of road work.
“They never did ask for financial assistance, but they are probably going to Missouri if they leave here,” Wilkins said. “I’ve heard Missouri has offered them a deal. They have a lot of things located in Missouri. They have more plants in Missouri. It’s kind of out of the way here.” He said he heard that from some former managers at the plant.
Wilkins said he also understands that if the company rebuilds it is likely to employ about half of its previous work force, about 300 to 400 people, and that a freezer valued at between $ 30 million and $ 40 million was undamaged by the fire. He said he also heard the company was self-insured, so it wouldn’t be getting compensated for the fire damage.
“I think the governor has done an excellent job,” he said. “We don’t know what kind of package the state has but it’s probably a good package. We need jobs in these communities. [Incentives ] are definitively worthwhile.” He said money spent by workers will help local businesses and the city’s tax collections.
Wilkins said he thought the county may have offered “some concessions on some taxes” but didn’t know details.
He said Cargill officials said a week ago to expect a decision within 30 days.
Logan County Judge Edgar Lee Holt couldn’t be reached for comment, said a worker at his office.
Cargill spokesman Mark Klein wouldn’t address the company’s insurance or whether state and local incentives are necessary.
“We are still accessing the extent of the damage to determine what we will do next,” Klein said.
According to the company’s Web site, it had $ 88 billion in sales in 2007, up from $ 54 billion in 2003. During that same period, its net earnings increased from $ 1. 2 billion to $ 2. 3 billion and net worth from $ 9. 7 billion to $ 16. 2 billion.
Later, Beebe spokesman Matt DeCample said the state’s package didn’t include money from the Quick Action Closing Fund, a $ 50 million discretionary fund for economic development created during the 2007 legislative session.
DeCample said the only detail of the plan he could release is that it includes federal Community Development Block Grant money.
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