Springfield, MO

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Kraft Heinz plant in running for $48M in improvements

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The Kraft Heinz Food Co. (Nasdaq: KHC) is again looking to expand product lines and upgrade manufacturing equipment at its Springfield plant.

Springfield City Council last night approved a resolution of intent to issue Chapter 100 industrial revenue bonds of up to $48 million to incentivize the company to make improvements to the local plant, 1951 E. Meadowmere St.

The project is competitive with Kraft Heinz plants in other markets, said Sarah Kerner, the city’s director of economic development, at the meeting.

In its Chapter 100 bond request, Kraft Heinz is asking the city to exempt personal property taxes of 75% for five years on the purchase of the equipment, though the city’s adopted policy is to grant 50% abatement for 10 years, Kerner said. The project would allow the company to maintain its 950 employees at the 750,000-square-foot plant, according to bill documents.

Kerner said the city typically requires companies who utilize Chapter 100 bonds to make payments in lieu of taxes to all taxing jurisdictions in an amount equal to 50% of the exempted property taxes.

This isn’t the first time Kraft Heinz has invested in its Springfield plant with help from the city. In 2016, council approved a Chapter 100 bond plan that financed up to $36 million in equipment purchases. Before that, council approved $26 million in Chapter 100 bonds in 2012 as part of a $55 million expansion of the plant’s cheese and pasta production, according to bill documents.

Council passed the resolution of intent last night 8-1 through a Zoom videoconferencing session, with Councilman Mike Schilling opposed.

“I would assume this is a multibillion-dollar corporation. … Why do we have to give them tax breaks?” Schilling said. “I’m getting weary of this ongoing, ... getting on our backs to help them pay their way when they’re richer beyond compare.”

Council also heard the first reading of a proposal to create a preliminary funding agreement between the city of Springfield and Kraft Heinz for the potential project. The proposal will be up for vote at the April 20 council meeting.


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