Daily Tax Report: State provides authoritative coverage of state and local tax developments across the 50 U.S. states and the District of Columbia, tracking legislative and regulatory updates,...
By Alex Ebert
California battery company EnerBlu Inc. is getting two silver mint julep cups, a handle of Maker’s Mark, and up to $30 million in tax incentives for moving its headquarters to Lexington and opening a new plant in eastern Kentucky.
The private company’s planned $412 million investment was heralded Dec. 15 by state and federal politicians, as well as investors such as American Electric Power Co., Inc. (AEP). U.S. Rep. Hal Rogers (R-Ky.) called it “the real deal” that is projected to add 110 jobs at the headquarters and 875 jobs at a to-be-built Pikeville, Kentucky plant that will build batteries for electrical commercial vehicles.
The deal was championed because it brings hundreds of new manufacturing jobs to a part of the state decimated by the decline of the coal industry. The unemployment rate in that part of the state is 6.7 percent, and incentives approved by the state last week are tied to creating jobs paying an average of $39 per hour, including benefits. The median per-capita income in that part of the state is only $10.06 per hour.
“An abandoned land becomes a new landscape for new opportunities,” Rogers said at a Dec. 15 press conference in Pikeville. “This is the first major development project for ‘Silicon Holler.’”
Flanking politicians during the press conference were some unlikely investors—an actor born in the area and an energy executive who both said they believe the business will bring energy jobs back to the community.
Boyd Holbrook, star in the Netflix show “Narcos,” said he was encouraged to see energy jobs coming back to the community where his father was a miner. “Let’s take it back to America’s energy capital.”
Instead of muscling out the smart-grid company, Matthew Satterwhite, president and chief operating officer of electrical utility Kentucky Power Co., a subsidiary of AEP, said that once he learned about EnerBlu he became part of the recruitment process and got AEP to invest instead of compete.
“I’ve got an energy company coming in and I’m a power company. I could stiff arm that and say, ‘I don’t want that coming here,’” he said. “This is the future.”
The Kentucky Economic Development Finance Authority wouldn’t disclose which other states were vying for EnerBlu or what they were offering. However, company executives and local politicians said the bidding process was nationwide. Media reports had said that EnerBlu was also considering a transfer to Nevada, Utah, or Washington.
“We went everywhere. Johnny Cash had nothing on us,” Michael Weber, EnerBlu executive chairman said, choking back tears. “Here we were welcome like nowhere else.”
Pikeville has around 7,100 citizens, according to U.S. Census data. However, Gov. Matt Bevin (R) said the only other factory in the world working on batteries similar to EnerBlu’s started as a 35-person factor in China and now has 8,000 workers.
Economic development officials from Nevada and Washington didn’t immediately respond to requests for comment. The Utah body that approves development incentives didn’t vote on an incentive agreement with EnerBlu, Sara Adelman, spokesperson for the Governor’s Office of Economic Development, told Bloomberg Tax in a Dec. 15 email.
To contact the reporter on this story: Alex Ebert in Columbus, Ohio at email@example.com
To contact the editor responsible for this story: Cheryl Saenz at firstname.lastname@example.org
Copyright © 2017 Tax Management Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)