As of last week, Governor Jim Justice hinted at a major upcoming economic development announcement during this week’s State of State Address. Rumors and reports are brewing about a large manufacturing plant planned for Mason County.
To attract this business, the state offers a series of financial incentives and tax credits. To ensure that everything happened in time for his speech, Justice called the legislature in a special session.
The first bill passed was called the West Virginia Industrial Advancement Act. It offers tax incentives, based on investment and employment thresholds, to promote development.
Theoretically, this program would be available to any large manufacturing facility wishing to locate in West Virginia. While the law is available to any business, it is in the works for Nucor, based in Charlotte, NC, and there are also $ 315 million in direct financial incentives.
Nucor is the largest steel producer in the United States, as well as the largest “mini-steel” steel maker. It is also the largest recycler of scrap metal in North America.
Other special session bills move money to pay for financial incentives. The invoices take money from existing positions and put it in a closing fund managed by the West Virginia Development Office. The money will be refunded in these positions using the US bailout money from the federal government.
The Senate suspended its usual rules and adopted all the bills. A few senators, like Mike Romano, D-Harrison, have expressed reservations.
“We have to be careful who is responsible for any arrangement allowing us to recover our tax money if this does not materialize, ”he said before voting in favor of the program.
The House of Delegates sent the bills to the House Finance Committee for further discussion.
House Bill 101 is a tax exemption plan for property and construction as well as the purchase of equipment to operate the facility. The minimum to benefit from this exemption is $ 2 billion. If the project lasts at least four years, the company could be eligible for $ 1 billion in tax exemptions. Committee members also learned that the company must create 500 jobs at 200% of the federal minimum wage.
Nucor is a Fortune 150 company looking to invest $ 2.7 billion and fill approximately 800 jobs as well as approximately 1,000 construction jobs over the next two years.
An economic impact study on the project indicates that it will generate approximately $ 25 billion in economic impact over 10 years.
During the Monday night session, Del. Larry Rowe, D-Kanawha, requested this statement and House Speaker Roger Hanshaw indicated he had requested it and it would be provided to House members before they are asked to adopt. the law.
Brian Abraham, the governor’s chief of staff, also said that Nucor’s three-year moving average was $ 96,000 per employee, which excludes management.
The money reallocated from the other five bills during the extraordinary session appeal is matching funds based on investments. Once Nucor invests $ 500 million, the state will pay it $ 125 million. With another investment of $ 750 million, the State’s counterpart is $ 150 million. The final $ 40 million in state matching comes from a separate facility that Nucor has proposed in the northern enclave. These matching funds are specific to Nucor.
Following the recommendation of the House finance committee, the House adopted the bills at first reading. They will resume them on Tuesday.