3/8/2010 12:00:00 PM State tax credits bolster two area companies Boyd Aluminum and Service Vending Co. to add nearly 30 jobs aided by more than $100,000 in credits
Employees work on Boyd Aluminum's window line at the company's Springfield plant. The company is getting nearly $90,000 during the next five years through the Enhance Enterprise Zone program to help with facility and work-force expansion.
How to Tap into EEZ Tax Credits
Job creation is the reason behind Missouri Department of Economic Development’s Enhanced Enterprise Zone program. To be eligible, a new or expanding business must create and maintain at least two jobs and spend a minimum of $100,000 in capital investments, including machinery, equipment, building, land or rent, according to www.ded.mo.gov.
John Fougere, DED’s director of communications, said most companies start the process of applying for tax credits by working with a DED project manager or a local economic development group, such as the Springfield Business Development Corp.
“We have project managers in every part of the state that work with local businesses. When they’re applying for economic programs, they’ll work with that project manager, who will be with them through every part of the process,” Fougere said.
The process starts with a company outlining the capital and employment investments it expects to make. DED officials then provide a formal proposal of the incentives it would offer under the program, which is followed by the company submitting a Notice of Intent for approval by the department.
“You have to fill out a lot of paperwork to get approved,” said Tisha Fronabarger, whose Service Vending Co. will receive more than $38,000 in tax credits over the next five years. “The whole thing has been ongoing since the end of November.”
In 2009, 37 companies received approval for a total of $14.4 million in EEZ tax credits, Fougere said, and in 2008, 40 companies were approved for tax credits totaling $19.5 million.
Business at Boyd Aluminum Manufacturing Co. and Service Vending Co. has outgrown the companies’ current locations, and both plan on physical and employment expansion in 2010.
But they’re not accomplishing the growth alone. The two companies will receive more than $100,000 combined in state tax credits and add nearly 30 jobs as a result.
Boyd Aluminum Manufacturing Co., 3248 E. Division St., and Service Vending Co. in Aurora have been approved to receive tax credits from the Missouri Department of Economic Development’s Enhanced Enterprise Zone program. Boyd Aluminum will receive $89,233, and Service Vending will get $38,455 in EEZ credits over five-year periods. The companies plan to add 15 and 13 jobs, respectively.
These plans come on the heels of Kraft Food Inc.’s decision to add 50 jobs to its Springfield manufacturing plant, aided by the nearly $400,000 Kraft will receive in state EEZ credits.
For Brad Squires, vice president at Boyd Aluminum, the tax credits were an added benefit for an expansion that already needed to happen.
“We were out of room to do what we needed to do, and it’s a very good time to add on because of the cost of building right now. Tax credits make it icing on the cake,” he said.
The aluminum window manufacturer will add approximately 34,000 square feet to its 60,000-square-foot building. The expansion, as well as the purchase of machinery, is expected to cost around $2.05 million. The company is in the process of evaluating bids, but Squires said he expects three-quarters of that total to be spent on the building.
The additions to the company’s 45-member staff will happen closer to the building’s completion date, which is expected in November, Squires said.
“We’ll probably start evaluating applications in late summer,” he said.
The new positions will be hourly jobs, with approximately two office positions and the remainder manufacturing positions, he said. Squires declined to disclose pay rates but said compensation would be competitive with other area manufacturing jobs.
At Service Vending, co-owner Tisha Fronabarger said the company plans to add 13 drivers within three years to its current work force of 33. One driver already has come on board and two more hires are expected soon, she said.
The bulk vending company operates in 26 states, and drivers spend most of their week on the road maintaining amusement vending machines that sell novelty items such as stickers and tattoos, Fronabarger said. Drivers are paid a salary and commission from their routes.
The company recently expanded its business by investing in crane, or claw, vending machines, she said, and likely would hire another two drivers to service those clients within the year. Fronabarger expects about $800,000 to be invested in new equipment, primarily vending machines, in the next three years. Adding sales staff is also a possibility.
In the past three years, Boyd Aluminum has introduced new product lines, including historically accurate windows for landmark buildings, Squires said. The three largest areas of growth are in blast systems, designed to withstand the pressures of potential terrorist attacks; impact systems that meet building codes for weather-resistance in coastal areas; and green systems, he said.
“Green and (Leadership in Energy and Environmental Design) specifications for commercial aluminum windows are just now coming down. We’re trying to enter that market,” Squires added.
The new areas of focus have helped carry the company through the recession, when Boyd Aluminum’s core products – including awning, casement, double-hung, fixed and sliding windows – experienced a slump in sales.
“Core business was down in the past years, but coupled with the new areas, we weren’t as affected as we could have been,” he said, declining to disclose sales figures.
