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House approves Big River Steel bonds

by David Harten | April 8, 2013 at 12:40 p.m.

The Arkansas Legislature has approved House Bill 1870, which will allow several incentives and obligation bonds to be used in the construction of the Big River Steel plant in Osceola.

The House passed the bill in a 78-17 vote Monday. Two members did not vote.

Senate and House committees on Agriculture, Forestry and Economic Development approved the bill last week, and the Senate passed its version of the bill in a 26-6 vote Tuesday.

The incentives authorized by the bill, proposed by Rep. Monte Hodges, D-Blytheville, include a $70 million grant to fund infrastructure costs for construction, a $50 million loan and a $20 million grant for stabilizing the ground on which the plant will be built, next to the Mississippi River.

All orders fall into compliance with Amendment 82 of the Arkansas Constitution.

Speaking before the House on Monday, Hodges said that the bill has received overwhelming support from his area.

"One thing we told our constituents is, we wanted to bring jobs back to the community," Hodges said. "We have an opportunity to do that with the Big River Steel Project. Since Amendment 82 was passed in 2004, this is first time we've ever had to use it. So I'll be pretty thankful that an industry of this magnitude would come to Arkansas."

The plant's total construction cost is estimated at $1.1 billion. Big River Steel would employ nearly 525 workers with an average annual salary of about $75,000, according to its chairman and chief executive officer, John Correnti.

Rep. Stephen Meeks, R-Greenbrier, spoke against the bill. While he was not adamant in his protest, Meeks said he did have some concerns about giving the project so much funding, given the newness of the company to the state.

"Big River Steel is a completely new entity with a backing that does not exist right now," Meeks said.

Before the vote, Rep. Adam Mayberry, R-Hensley, spoke for the bill, stating his belief that striking down the bill would scare off potential super projects in the future.

"We have been losing super projects to states all around us, year after year," Mayberry said. "If we have any hope of getting this super project this board says we had to have, unless there are overwhelming reasons to [vote against it], I think we do it."

He added that businesses that have interest in bringing projects to the state "will say 'don't even bother with Arkansas'" if the bill didn't pass.

The bill will now go to Gov. Mike Beebe for his signature. Beebe spokesman Matt DeCample has said that Beebe would sign the bill into law.

Read Tuesday's Arkansas Democrat-Gazette for more details.

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