Dassault Falcon Jet will spend $100 million to expand its production facilities at Little Rock's Bill and Hillary Clinton National Airport/Adams Field, allowing for more work on its Falcon 6X business jets while planning for future models, the company said Tuesday.
The expansion, taking several years, will mean 800 new jobs. Dassault plans to spend a minimum of $100 million on capital investments at the airport by the end of 2034, according to Airport Commission documents.
Clinton National Executive Director Bryan Malinowski said a new lease requires the multimillion dollar investment. Additional land under lease at the airport will also bring Dassault's total close to 159 acres, Little Rock Municipal Airport Commission documents said.
Dassault Falcon Jet currently employs about 1,400 workers across two facilities at the airport totaling 1.2 million square feet. Malinowski said the expansion will not affect air passengers' experience at the airport nor airline operations.
The new facility will have 14 to 16 bays to handle a forthcoming jet, Malinowski said. After immediate construction of a new paint hanger and other projects in the company's current facilities, Malinowski said construction on the new plant will probably begin in the next two to four years, with filling the 800 positions taking place over several years.
Airport commissioners voted unanimously Tuesday morning to authorize airport staff to amend the current ground lease agreement with Dassault Falcon Jet for a new effective date of Jan. 1, 2024.
Little Rock Regional Chamber of Commerce President and Chief Executive Officer Jay Chesshir said the lease agreement contains a potential 10-year extension. The $100 million capital expansion is equally divided, he said, into industrial revenue development bond authorizations with a payment-in-lieu-of-tax agreement, which lowers the site's property taxes for the period of the bond issue.
The Little Rock Board of Directors approved that bond-authorization agreement at its Tuesday meeting. The bond issuance won't all happen at once. The city will hold title to the capital investment until Dassault Falcon Jet finishes repaying its bonded debt.
State and local officials gathered Tuesday with Dassault executives in one of the company's production facilities at the airport to announce the project.
"I'm here to talk to you about the future and our projects here in Little Rock," said CEO Thierry Betbeze. "We know that we have the Falcon 6X, and this is our future today. There are other programs under development; this is the future tomorrow."
"That future means that we will invest several tens of millions of dollars in two fascinating buildings to build the new planes," he said. "The future means that we will hire hundreds of new employees in Dassault Falcon Jet Corporation. These are challenges indeed, but this is the future."
The multi-decade deal covers a period of time with an all-but-certain likelihood of economic recessions that will affect the business jet industry. Malinowski said the lease has provisions requiring Dassault Falcon Jet to make its investment and, should the company fall short, tender some monies back to the airport.
Dassault has "separate incentives with the state that provide for workforce credits and government quick-action monies, and then they're also working with the city for the bonds to help finance the facilities," he said. "The existing deal preserves the existing 1,400 employees and then provides for the additional 800, and those are really good jobs here in Arkansas."
Asked at the event how the state worked to attract Dassault's expansion, Commerce Secretary Hugh McDonald noted the "Create Rebate" program, which provides annual payments based on a company's annual payroll for new full-time employees, with a minimum payroll set for employees hired as part of the project, and the "Tax Back" program, which provides 10 years of sales and use tax refunds on the purchase of building materials, taxable machinery and equipment.
Both programs are incentives offered by the Arkansas Economic Development Commission. McDonald said the Dassault expansion will still result in net tax revenue even with the incentives. A allocation of $12 million, through Arkansas' Quick Action Closing Fund, was also offered to Dassault as a performance incentive in return for the company agreeing to create a certain number of jobs. The incentive package also included $6 million for workforce development.
McDonald said there are no requirements that Dassault hire Arkansans or source materials from the state, given the company's competitive need to build the most cost-effective facilities possible. "We have the workforce locally," he said.
On the points of education and worker training, Betbeze said Dassault Falcon Jet will work with the state and city to train students to become technicians.
"In a world where everything is virtual, what we have to offer as a company are real and true jobs with good compensation and some interesting technology," he said. "I hope we'll be able to create, together with the governor and others here, a taste for aviation for these jobs."
In part through public grant funding, Chesshir said the chamber's workforce development team is working with the state and company to put together workforce development programs to train students for Dassault jobs and attract already skilled workers to the company.
Besides recruiting recent graduates with engineering and other degrees, Chesshir also noted a planned aerospace-focused trade school, community college and high school curriculum, notably at the chamber-associated college preparatory and career oriented Academies of Central Arkansas.
At the announcement, Gov. Sarah Huckabee Sanders associated her trip to this summer's Paris Air Show, the world's largest, with Dassault's plan to expand its Little Rock presence, already Dassault Falcon Jet's single largest site. She said she first met Betbeze at the air show and has previously linked the trip to RTX and Rafael Advanced Defense Systems' plans for a new $33 million missile manufacturing facility at Highland Industrial Park near Camden.
"Since aerospace happens to be Arkansas' largest export, totaling more than $1 billion, I knew it was important for Arkansas to have a strong presence there," Sanders said.
"Arkansas workers past, present and future have shown that they have the skills and the work ethic to get this job done. And frankly, the entire world is starting to notice, between private aviation here in Central Arkansas, defense in the 'Golden Triangle' [Camden, El Dorado and Magnolia], defense installations in Little Rock and Fort Smith, and a host of other investments across the state, Arkansas' role in aviation is literally taking off," she said.
The governor also thanked Dassault Falcon Jet's current 1,400 Arkansas employees, saying, "You have done a phenomenal job, and because of your hard work, because of the way you represent our state, this company is growing and reinvesting even more here in Arkansas."
The company has operated in Little Rock since 1975. Unfinished aircraft are flown to the completion center for the installation of aircraft electronics systems, interior design and exterior painting. The company also has a customer service center in Little Rock.