January 06, 2009
Firms could create 238 jobs over next five years
MONTPELIER, Vt. – A start-up company; a long-time Vermont manufacturer; and a Canadian firm have been authorized to earn $1.7 million worth of incentives that could produce 238 new jobs over the next five years.
At its recent meeting, the Vermont Economic Progress Council gave initial approval for incentives totaling up to $795,139 for joint venture ASK-in TAG, LLC to potentially establish a facility in Essex to develop and manufacture radio frequency identification documents such as enhanced driver’s licenses.
The Council also gave initial approval for incentives totaling up to $246,051 to persuade Quebec-based BEMAG Transformers to open a U.S. facility in St. Albans to manufacture dry-type transformers. Final approval of up to $692,854 was given to BioTek Instruments, Inc., a Vermont company that makes laboratory instrumentation and software, for a potential expansion in Winooski.
“These projects represent opportunities in value-added manufacturing and the knowledge-based economy that could create many great jobs,” said Karen L. Marshall, Chairwoman of the Vermont Economic Progress Council.
“These incentives provide the State of Vermont with a real leverage point to encourage growth in new sectors, even while we are experiencing the pain of cutbacks in other industries,” Marshall said.
ASK-in TAG is a joint venture between ASK of France and WS Packaging of Wisconsin. The joint venture is seeking to establish a development and manufacturing facility to serve the growing market in radio frequency identification (RFID) documents.
The project will produce enhanced licenses for several U.S. states, event entry cards such as those produced for the recent Olympic events, mass transit cards, and RFID passports for several countries. The company is also considering a location in Ohio, where joint venture partner WS Packaging has an existing facility.
“ASK-in Tag is very appreciative of the State of Vermont’s offer of tax incentives. The people at the Vermont Economic Progress Council have been extremely helpful,” said David Uland, Senior Business Development Manager for WS Packaging. “We are still in the process of reviewing potential manufacturing sites and expect to reach a decision by mid-January.”
BEMAG Transformer produces dry-type transformers in Farnham, Quebec, where they have outgrown their facility. The company is considering expansion in Canada or Plattsburgh, New York to serve a larger market including the Northeast U.S. The new facility will employ innovative manufacturing practices and equipment developed and built in-house by BEMAG engineers, enabling greater efficiency and reliability.
“We are pleased with this initial approval. VEGI’s important cash incentives are key in our decision to locate our new US operation in St. Albans, Vermont. Our new company, VERMONT Transformers, Inc. will have the opportunity to significantly expand its Canadian market and to begin to exploit the lucrative and essentially untapped billion dollar US market,” said Christian Roberge, Vice President and CFO of BEMAG Transformers.
BioTek is a family-owned, Vermont company that was started by UVM professor Dr. Norman Alpert in 1968. BioTek has grown to be a global leader in the development, manufacture, and servicing of microplate instrumentation, automation, and software.
The company has doubled in size during the past five years and expects similar future growth which cannot be supported in their current facility. The firm is strategizing for long-term growth and has received relocation offers from North Carolina and Virginia.
“Despite the world economic challenges we at BioTek remain very optimistic about the future,” said Briar Alpert, President and CEO. “We compete in a global economy and correspondingly to be successful we must produce the best value for our customers if we are to prosper.”
“With the Vermont Economic Growth Incentive Program, Vermont now has a tool that increases the likelihood that a company located within the state can grow and compete and win against world-class companies located anywhere in the world,” Alpert said.
In other actions, the Council gave final approval for a project by Tata’s Natural Alchemy in Shoreham. An initial application was approved in December 2007. The Council also denied a final application submitted by Vermont Wood Energy Corporation, for a project that was initially approved in July. The Council determined that the revised application, which materially and substantially changed the project, did not meet the program criteria.
Under reforms proposed by Governor Jim Douglas in 2006 and passed by the General Assembly, the VEGI economic incentives are authorized based on job creation and capital investments that must occur before the company earns the incentives and then the company receives incentive installments over a period of years. The four authorized companies are eligible to earn a maximum of $1,965,575 in job creation incentives over five years only if they meet and maintain payroll, employment and capital investment targets each year. BEMAG and ASK-in TAG must also submit Final Applications for consideration by the Council.
The previous incentive program had companies earning tax credits that were applied against future tax liability.
The Council approved the applications after reviewing nine program guidelines and applying a rigorous cost-benefit analysis which showed that because of the economic activity that will be generated by these projects, even after payment of the incentives the State will realize a minimum net increase in tax revenues of $1,626,657 over five years.
The Council also determined that these projects would not occur or would occur in a significantly different and less desirable manner if not for the incentives being authorized.
The Vermont Economic Progress Council is an independent board consisting of nine Vermont citizens appointed by the governor that considers applications to the state’s economic incentive programs.
The Council is attached to the Vermont Agency of Commerce and Community Development, whose mission is to help Vermonters improve their quality of life and build strong communities.
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Source: Department of Economic Development
Last Updated at: January 06, 2009 08:45:44