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North American Stainless hopes to win the state’s approval this month for a $10-15 million funding package to expand its long products division in Ghent.
Carroll County Fiscal Court approved an inducement resolution Tuesday, Jan. 11 for up to $30 million in bonds and state real estate tax breaks for the NAS project.
NAS Vice President of Finance and Administration Mary Jean Riley said this would create 10 to 15 new jobs. The remaining funding in the inducement package would cover additional costs associated with previous projects and some cost overruns on those expansions.
At last Tuesday’s meeting, Riley told fiscal court that the long products division at NAS is currently running at full capacity, due in part to a fire at another of the company’s plants in Europe. The long products facility produces stainless steel billets, rods, angles and bars.
“Unfortunately for our sister company, but fortunately for us, they had some issues with a fire and so on that in the long products we are running at capacity,” Riley said. “We don’t have any excess capacity there at all because we’re trying to assist them with filling their orders with their European customers. That even amplifies the need for this project that we’re looking for. “
While the expansion will not help with filling those orders, Riley said in a Thursday interview that this new line is something that NAS officials have been discussing for several years. It will allow the company to produce a new smaller product that they don’t have today.
“As you all have in the past, you have allowed us to use industrial revenue bonds for some of the financing for this project to assist us with lowering the property taxes that the state receives,” Riley told fiscal court.
The inducement resolution won fiscal court’s approval.
Carroll County Judge Executive Harold “Shorty” Tomlinson said the county is always glad to talk with and assist local industries. He noted for the court that the $30 million inducement resolution for the project does not include any money from county government.
In this day and time, Tomlinson said anytime local industries are creating new jobs “you’ve got to be happy.”
He called the NAS proposal “a very positive sign for our area.”
Riley said after winning approval from fiscal court, staff at NAS is now working to put together a proposal to take to Kentucky’s Economic Development Authority Board for approval. She explained that NAS must show that the tax breaks will generate sufficient other taxes, such as sales and occupational taxes, to more than make up for the tax breaks requested.
She noted that all previous NAS requests to this economic development cabinet board have been approved. This new proposal could be granted later this month or in early February.
The proposal must also win approval from corporate officials with the Acerinox Group in Spain, NAS’ parent company.
Riley said it will be about two years before the expansion would be ready to come online. It will be visible from U.S. Hwy. 42 East on the river side of NAS’ property. The expansion will take place at the second building traveling from Carrollton, she noted.
During a 2010 investors day program, Acerinox Group information showed NAS has the capacity to produce up to 1.4 million metric tons of steel per year through melting, 1.2 million metric tons a year through hot rolling and up to 850,000 metric tons a year through cold rolling. Acerinox has made investments of nearly $700 million in NAS from 2005 to 2009 to bring the facility to today’s production levels, according to presentations at that meeting.
Tomlinson said 2011 is off to a good start. He pointed out that in addition to the NAS proposal to expand its long products facility, Dow Corning has acquired the former Arvin Meritor property. While there are no immediate plans for that land, he said the investment in the community provides Dow Corning with the room to expand in the future.
“These are all good signals,” Tomlinson said.