NEW YORK The city of
Osceola, Ark., has approved a $2-million incentive for Big
River Steel LLC, marking the latest in a series of
government-backed financing deals for the proposed flat-rolled
The Osceola City Council voted
this past week on the financing commitment, a council spokesman
told AMM, but funds are contingent on certain
provisions being met, including the promise of 525 permanent
jobs at wages of $75,000 per year.
The move comes on the heels of
the Arkansas state legislature giving final approval for $125
million in bond financing to the $1.1-billion project, which is
spearheaded by industry veteran John D. Correnti (
amm.com, April 16). Last month, the Mississippi
County Quorum Court also unanimously approved a conditional
$14.5-million grant to the project (
amm.com, March 27).
"The city and county incentives
are completely in tandem," the spokesman said. "The city will
require the same investment from Big River Steel and will have
the same clawback provisions as the state and county."
Although the states bond
sale has been approved, Arkansas will not invest any money
until $300 million in equity from company investors and
commitments from other lenders is deposited into an escrow
account, a spokesman for the Arkansas Economic Development
Commission told AMM in February. In addition, under
the terms of the legislation, $250 million of company money
must be spent before any bond proceeds can be given to the
The city spokesman said that the
$2 million, along with some $7 million from the county, will go
toward purchasing land for the mill. The remainder of the
county grant will go toward infrastructure projects, such as
energy lines and transportation routes, he said.
"The state, city and county
financing has all been approved by their respective city
legislatures. Were completed. Now, its just a
matter of Big River finishing its process of environmental
and regulation approvals," he added.
Big River Steels proposed
1.7-million-ton-per-year steel mill, aimed at supplying steel
sheet to the oil and gas, automotive and electrical industries,
is expected to break ground in the fall. While local
legislators appear to overwhelmingly support the mini-mill
project, others have opposed the mill on grounds that there is
already overcapacity in the domestic sheet market, including
nearby competitor Charlotte, N.C.-based Nucor Corp. (
amm.com, March 18).