Employers tap incentives for growth

Incentives are not handouts. That’s a message Rob Dixon, vice president of business assistance for the Springfield Area Chamber of Commerce, preaches in the business community.

Another message he’s known to share: Incentives are available – even for established companies in the area looking to grow.

Last month, Diamond International of Springfield, which offers truck sales and services, announced plans to build a 60,000-square-foot facility to house its local work force. The building is being constructed at a Prime Inc.-owned commercial and industrial site along Interstate 44 west of U.S. Highway 65.

The $8 million capital investment includes the addition of 33 employees to its staff of 47. The new facility and job growth is being supported by more than $640,000 in local and state tax incentives.

“Often, we talk about economic development as just being new companies coming into our market, but as we see in the case with Diamond, it is the companies that are already here that are growing and expanding that really drive our economy,” Dixon said.

He said Diamond International representatives approached the chamber in the fall about incentives available for their expansion plans. After reviewing some options, officials selected the local property tax abatement and state tax credits available through Springfield’s Enhanced Enterprise Zone.

Dixon said the Enhanced Enterprise Zone, which encompasses most of the city and parts of Greene County, is designed to encourage local growth by existing companies.

“It incentivizes companies to create jobs and to invest capital back into our community. These are the things that pay for our schools, pay for our roads and pay for government services, and put our citizens to work and allow them to earn a good income,” Dixon said. “These are not giveaways to companies. These are programs that encourage companies to grow.”

For Diamond International, Dixon said the business would earn roughly $388,000 in property tax abatement and $253,000 in state tax credits if it sticks to its plans.

Credits and incentives don’t arrive until after the work is done, Dixon said, and if hiring or capital purchases are downgraded, incentives would be reduced as well.

The chamber – through its affiliate organization Springfield Business Development Corp. – helped 12 companies in 2011 secure incentives to forward projects with capital improvement and jobs creation plans. (For details on the work of the SBDC, see “Bringing Business Home” on page 9.) Calls to Diamond International of Springfield General Manager Steve Cook were not returned by press time.

In addition to the Diamond development, this year, three manufacturers are collectively adding 100 jobs and $7 million in capital investments in the area. SRC Automotive Inc. has expanded its west Springfield manufacturing facility; SRC Power Systems expanded into a 72,000-square-foot recently vacated pickle plant; and startup United Poly Systems now occupies a 48,000-square-foot building that was available in the Partnership Industrial Center.

The chamber helps businesses tap into six tax credit programs, one work force training program and one bond-financing program, often acting as a liaison for companies pursuing credits through the Missouri Department of Economic Development.

While Springfield officials have years of experience navigating business incentives, a fledgling group of economic developers in Republic is working to get the word out.

On May 10, the nonprofit Republic Business Industrial Development Association held a fundraiser at The Tower Club at Hammons Tower.

President Gail Noggle, who is also Republic’s planning and development director, said the two-year-old organization has raised $35,000 since its inception. Last week, the association received a $10,000 donation from Empire District Electric Co.

Thus far, members have attended trade shows and joined forces with the Springfield Regional Economic Partnership and the Missouri Partnership to promote the city. Noggle said a function of the group is to encourage business growth by connecting developers to incentive programs such as Republic’s Enhanced Enterprise Zone.

RBIDA board member Bob Beine, owner of the Ford dealership in Republic, said during the last 30 years, the city has encouraged employers such as Wal-Mart Stores, McLane Co. Inc. and Lowe’s to invest in the city, and the RBIDA is an extension of those efforts.

Most recently, Noggle has worked with developers to advance plans for a $350 million equestrian center planned in Republic.

“We’ve got more than Brown’s Country Kitchen to eat at these days,” Beine said.