Making ‘give and take’ work for metals and John Q. Public
Dec 01, 2008 | 07:40 AM
Small, mid-size and even larger steel-consuming manufacturers—as well as the local economies in which they operate—are among the benefactors of tax credits or financial incentive programs offered by local and state governments, as illustrated by three case studies.
The first involves Chicago-based Tempel Steel Co., which in August had considered shuttering its suburban Libertyville, Ill., production facility and relocating the operations to Mexico. But with the help of tax credits and other financial incentives from city and state economic development organizations totaling up to $7 million over several years, the company instead agreed to consolidate the suburban operations at its Chicago facility.
Tempel Steel, which describes itself as the largest independent manufacturer and global supplier of motor lamination steels with 2007 sales topping $500 million, was offered the incentive package only three months after approaching the City of Chicago and state leadership.
Vincent Buonanno, Tempel's chairman and chief executive officer, credited Chicago Mayor Richard M. Daley and his office with providing "the jet fuel for accelerating the permitting process" and other needed approvals to expand its Chicago manufacturing facility to relocate the Libertyville operations there.
Tempel expects to spend between $10 million and $13 million on the Chicago expansion and Libertyville relocation. By July 2009, the Chicago headquarters will add about 40,000 square feet of manufacturing space, Buonanno said, and many of the Libertyville workers will join that operation, doubling the employee base in Chicago to 700 from 350. "The big decision" that the incentives provided "was not to take it all to Monterrey (Mexico)," where Tempel operates a third motor-lamination plant, he said.....
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