FORT SMITH -- The Board of Directors threw its weight behind an industrial facility expansion reportedly leading both new jobs and further security of existing jobs.
The board approved issuing industrial development revenue bonds Tuesday to assist Virginia-based Gerber Products Co. finance an expansion of the product line at its Fort Smith facility.
"The company proposes that the expansion will house food processing and manufacturing equipment, associated machinery and infrastructure improvements at the site requiring expenditures estimated not to exceed $30 million," Deputy City Administrator Jeff Dingman wrote in a memo. "In addition to the significant product line expansion and the retention of 480 current employees, the company will be adding 25 new jobs with an approximate average wage of $21 per hour."
The reduction of property taxes paid by the company, Dingman said, is the principal advantage of industrial revenue bonds. When the process is completed, the company and the city will enter into a Payment in Lieu of Taxes agreement, through which the former will pay an amount equaling 35% of the normal property taxes for 15 years. The value of this incentive is estimated to be about $1,900,471.
Gerber will be solely responsible for the debt service payments on the bonds, with the city having no obligation.
"The Fort Smith Regional Chamber of Commerce, as the city's economic development representative, was instrumental in securing this additional investment by one of Fort Smith's significant employers," Dingman wrote. "This action and the resulting investment by Gerber Products Company will support one of the board's top goals: economic development and job retention/creation."
In addition to thanking the city administration and Tim Allen, president and chief executive officer of the chamber of commerce, City Director Kevin Settle thanked Gerber for investing in Fort Smith and its residents.
"Words can't express how gratifying it is to see companies continue to invest in Fort Smith," Settle said.
Director Robyn Dawson said these types of investments don't happen without a considerable amount of work. To her, the expansion project will secure the jobs for Gerber, bringing security of both jobs and city economy for a long time.
"Again, that did not happen just by a draw of a hat," Dawson said. "The chamber president, Mr. Allen, had to work very hard to convince the headquarters that Fort Smith was the place that they needed to relocate. We were in competition, again, with other states, and so, ... just know that your chamber is working very hard in conjunction with the city to make sure that we are progressing and we are protecting the people that live here."