Financial incentives OK'd for 3 firms

A state board on Friday approved financial incentives for three companies to put operations in rural Utah but was more tight-lipped than usual about both the companies and their incentives.

The largest incentive approved by the Governor's Office of Economic Development Board was up to $2.35 million in tax rebates for a company that would pay at least twice the county median wage. The smallest, up to $700,000, requires an accompanying county incentive. That company also would pay at least twice the county median. The other totaled up to $1.5 million and would pay 125 percent of the county median.

All three call for tax rebates over a 10-year period, and each company must commit to keeping operations in the state for at least that long.

Mark Howell, who chairs the board's incentives committee, said details were kept confidential at the requests of the companies.

While it is not unusual for the board to keep a company's name secret, especially since the tax-rebate incentive overtook the Industrial Assistance Fund as a preferred incentive, Friday's meeting featured even less information than usual. No details were mentioned about the number of jobs for each incentive; generalities about the company operations, such as its industry sector or type of product or services offered; or the counties the companies are considering.

Chairman David Simmons mentioned that the three approvals could lead to 350 total jobs.

Board member Debra Tanzi said it is "wonderful" that the approvals are for rural areas of the state. Stephanie Frohman, vice president of business development at the Economic Development Corp. of Utah, said many companies are seeking a good labor pool at an affordable price, and these three companies had a strong need for land.

"It seems too easy in rural (areas) to focus on what they don't have," board member Bill Boyle said. "I think in all three cases here, the communities involved have natural competitive advantages and leveraged those, and all three are very good matches for the community and good matches for the situation."

Although putting out the financial lure to companies does not guarantee they will act upon them and put operations in Utah, board members lauded the effectiveness of the new tax-rebate program.

"We thought it would be a good tool, and it turned out to be what it really was expected to be," Howell said.

During the past year, Simmons said, the rebate program "has made a significant difference, much more so than we've seen for quite a while." He added that the results include "a lot of job creation, a lot of capital investment."

The three Friday approvals could lead to nearly $100 million in capital investment by the companies in Utah, and while costing the state less than $5 million, the boost in tax benefits over the next decade could be $15 million to $20 million, he said.

"These are the kind of deals that we ought to do every day for the state if we can bring these kinds of jobs here," Simmons said.

The three approvals Friday also feature full benefits for employees — a goal for any project locating in rural parts of the state. "These are jobs that carry full benefits, and that's absolutely critical for us to see," Simmons said.

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