General Electric could get $15 million a year from Kentucky incentive program
LOUISVILLE, Ky. (WDRB) -- General Electric Co. could get $15 million a year from Kentucky taxpayers under a bill pushed by State Rep. Larry Clark of Louisville, according to a new analysis by the Legislative Research Commission.
GE -- which makes dishwashers, laundry machines and refrigerators at its 60-year-old Appliance Park factory in Louisville -- has already been promised $20.5 million from the state coffers over 10 years, or about $2 million a year.
But Clark's bill would sweeten the taxpayer assistance to GE by offering the same mega-deal incentives the state currently reserves for automakers such as Ford Motor Co. and Toyota and for their suppliers.
The sweetened incentives are meant to secure a $325 million investment from GE in "research and development and appliance production" at Appliance Park, according to a press release Clark's office issued last week. Clark, a Democrat representing the Okolona area, did not return a call on Tuesday.
Clark's bill would allow GE to get taxpayer money under the Kentucky Jobs Retention Act, which the state created in 2007 to lure Ford into revitalizing its two Louisville plants.
Only two companies have been awarded Jobs Retention Act incentives – Ford and Toyota.
The incentives are open only to factories that have been in Kentucky for five years and already employ at least 1,000 workers. The company must invest at least $100 million in the factory to qualify for help under the act.
Normally, the state requires the creation of new jobs before it doles out economic development assistance. But the Jobs Retention Act requires the factories only to maintain their existing employment.
In the press release, Clark's office said the investment GE is pondering would "help the company reach its goal of maintaining current employment levels by redeploying employees to jobs created by additional component and product insourcing, new product capacity and research and development expansion."
GE has "nearly 6,000" workers at Appliance Park, according to Clark's press release. An updated figure wasn't immediately available from the company.
The Jobs Retention Act incentives are available for up to 10 years, meaning GE could get as much as $150 million if the Legislative Research Commission's estimate holds firm.
However, GE's actual award would depend on negotiations with the Kentucky Economic Development Finance Authority, the LRC said in its "fiscal note" dated Feb. 19.
Ford could collect up to $290 million over 10 years under the Jobs Retention program if the company follows through with $1.8 billion invested at Louisville Assembly Plant and Kentucky Truck Plant. Toyota has been promised up to $146.5 million in exchange for a $531 million investment in its plant outside Lexington.
GE said in a statement last week that it is "evaluating investments" exceeding $325 million in Appliance Park, which would come on top of $800 million the company has invested in the factory since 2009.
"While a small part of the total investment under evaluation, state incentives play an important role in the business' decision to invest, in particular, as it demonstrates that state leadership is committed to business growth and sustaining employment in the Commonwealth," GE said.
In addition the $20.5 million state award approved for GE in 2012, Louisville Metro government gave GE a deal in 2009 worth up to $2.5 million.
Metro government created a special "tax increment finance" district for Appliance Park – an arrangement that allows GE to keep 80 percent of the new Metro government occupational taxes generated by the addition of workers at the park for 10 years.
David Morris, an attorney in the Louisville Metro Department of Economic Growth & Innovation, said it's too soon to say whether the "TIF" district at Appliance Park would be affected by a new Jobs Retention deal for GE at the state level.
The Legislative Research Commission noted that a local government such as Louisville Metro could participate in a Jobs Retention Act deal, which would add to the $15 million / year award.
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