Council moves forward with Kraft incentives

Springfield City Council last night voted unanimously to approve a preliminary funding agreement as part of its plans to offer Kraft Foods incentives to support a proposed upgrade of its roughly 780,000-square-foot plant in east Springfield. However, Councilman Doug Burlison said he hoped the move would not be used as a way to reduce the facility’s work force, and he called for a review of the city's year-old incentives policy.

The plan establishes that Kraft would pay up to $50,000 in attorneys' fees to Kansas City-based Gilmore & Bell PC. The payments are a step toward securing up to $55 million in Chapter 100 redevelopment bonds.

At the June 18 meeting, council also unanimously approved a resolution for the city to work with Kraft to develop a specific incentives package consistent with the Springfield's economic development policy, which was adopted in February 2011. The city is expected to offer the manufacturer at least 50 percent tax abatement on plant improvements for 10 years and eliminate sales taxes for new equipment purchases.

Prior to voting for the funding agreement, Burlison said he thought council should take a closer look at its incentives offerings to ensure that those companies that have access to bonds or tax breaks are creating jobs.

“This particular bill I have no problem supporting. I’d like to see this project come around,” Burlison said. “As far as the subsequent action we'll be looking at when it's ready, I have concerns the policy we have in place could enable some substantial downsizing of the Kraft work force.”

At the July 18 meeting, Springfield Kraft Plant Manager Todd Sherman told council that no immediate hiring was planned, but that the upgrades would help ensure the continued viability of the facility, which opened in 1939.

Councilman Jeff Seifried said a review of the city’s policy may be in order, but not before it works with Kraft.

The agreement passed last night requires Kraft to deposit an initial $10,000 with the city, allowing it to move forward with the Kansas City law firm. Further deposits of $10,000 and $30,000 would be required to cover legal expenses if needed.

Kraft Foods, which employs 975 workers in Springfield, would use the bond proceeds to perform facility and equipment upgrades to gain new product lines, according to Sherman. Sherman has said Kraft plants in Illinois and Minnesota would be next in line to gain facility improvements should the company not secure incentives in Springfield.

At the June 18 meeting, Springfield Economic Development Director Mary Lilly Smith said the plan should be available for council review by the end of July.[[In-content Ad]]