Lexington's 21c Museum Hotel's TIF plan approved

ssloan@herald-leader.comDecember 13, 2012 

The Kentucky Economic Development Finance Authority board approved $1.1 million toward the conversion of the historic First National Building on West Main Street in Lexington into a 21c Museum Hotel. Approval was given to a $500,000 tax-increment financing plan and tax incentives of $600,000.

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The Kentucky Economic Development Finance Authority board approved tax incentives Thursday for companies, including the 21c Museum Hotel in Lexington and Dippin' Dots, that are considering new investments in the state.

The approval of tax incentives outlines the state's commitment to a project should it occur in Kentucky.

In general, when a company accepts the tax incentive, it can keep that amount of money, which it would otherwise pay in taxes, assuming it fulfills the terms of the deal. Here are selected board preliminary approvals, unless otherwise noted:

■ The KEDFA board gave approval Thursday to a tax-increment financing plan associated with the 21c Museum Hotel, to be built in downtown Lexington's historic First National Bank Building.

The idea behind TIF projects is for governments to invest in improving infrastructure and then pay for those improvements using new tax revenue, which developments are expected to generate when they are completed and areas are revitalized.

The proposed $37 million project was approved for $500,000 in TIF funding. The $500,000 in public infrastructure improvements will include $450,000 for improvements to features such as curbs and sidewalks, and $50,000 for street lighting, according to city documents.

The hotel, part of the Louisville-based hotel group, also received approval for $600,000 in tax incentives under a state program that provides refunds of state sales and use taxes paid for certain building and construction materials.

Thursday's approvals are in addition to other incentives, including a $1 million loan previously approved by Lexington's Urban County Council.

■ Hayashi Telempu North America in Frankfort, $1.3 million to open a new automotive supplies manufacturing plant. The company estimates that the new plant will cost $10.72 million. It is expected to add 103 jobs that pay an average hourly wage of $16, including benefits.

■ R.R. Donnelley & Sons in Glasgow, $1 million to expand its plant, which prints special-interest magazines. The company estimates that the expansion will cost $5.63 million. It is expected to add 58 jobs that pay an average hourly wage of $14, including benefits.

■ Smith & Smith Manufacturing in Olive Hill, $1.5 million to lease a manufacturing plant and build a variety of products, including items for the automotive and sign industries. The company estimates that the plant will cost $2.5 million. It is expected to add 80 jobs that pay an average hourly wage of $13.50, including benefits.

■ Advanced Green Components in Winchester, $750,000 to buy additional property and install new equipment at its plant, which manufactures steel components. The company estimates that the expansion will cost $11.96 million. It is expected to add 40 jobs that pay an average hourly wage of $18, including benefits.

■ Toyota Boshoku Kentucky in Lebanon, $5 million to expand its plant, which produces parts for vehicle bumpers. The company estimates that the expansion will cost $37.01 million. It is expected to add 46 jobs that pay an average hourly wage of $35, including benefits. The company also was approved for an additional $200,000 in tax incentives under a different program.

■ Dippin' Dots in Paducah, $500,000 to expand its production plant for new freezer and packaging equipment. The ice cream company estimates that the expansion will cost $3.14 million. It is expected to add 30 jobs that pay an average hourly wage of $18, including benefits. The company also was approved for an additional $25,000 in tax incentives under a different program.

■ Toyotetsu America in Somerset, $1.5 million to upgrade equipment at the automotive supplier's plant. The company estimates that the expansion will cost $13.08 million. It is expected to add 26 jobs that pay an average hourly wage of $18.72, including benefits.

■ Pegasus Industries in Shelbyville, $200,000 to open a new automotive supplies plant to manufacture and provide subassemblies. The company estimates that the plant will cost $3.75 million. It is expected to add 20 jobs that pay an average hourly wage of $15, including benefits. The company also was approved for an additional $80,000 in tax incentives under a different program.

■ Kroger in Bowling Green, final approval of $950,000 to expand its Country Oven Bakery manufacturing operation. The company estimated that the project would cost $25.47 million. It was expected to add 39 jobs that pay an average hourly wage of $24, including benefits.

■ Illinois Tool Works in Lexington, final approval of $200,000 to expand a plant that produces fasteners for the automotive industry. The company estimated that the expansion would cost $1.17 million. It was expected to add 10 jobs that pay an average hourly wage of $14.85, including benefits.

■ Mine Shield in Lancaster, final approval of $950,000 for its operations producing underground mine refuge chambers. The company estimated that the plant will cost $950,000. It was expected to add 35 jobs that pay an average hourly wage of $16.08, including benefits.

■ Summit Biosciences in Lexington, $500,000 to expand operations that produce nasally delivered pharmaceutical products. The company estimated that the project would cost $5.06 million. It was expected to add 22 jobs that pay an average hourly wage of $24.06, including benefits.

■ Long John Silver's in Louisville, $1.5 million to establish its new headquarters. The company estimated that the headquarters would cost $3.81 million. It was expected to add 60 jobs that pay an average hourly wage of $55, including benefits.

■ The board approved a two-year extension for Lexington firm AllTranz to create jobs as part of a $500,000 forgivable loan that initially was approved in 2007.

Under the terms of the loan, the company was to create 30 full-time jobs by the end of 2012, with salaries averaging at least $80,000. The company, which develops treatments for various neurological disorders, has created only four jobs so far.

In exchange for the extension, the company offered the state a lien on all intellectual property in addition to its lien on the firm's equipment.

Scott Sloan: (859) 231-1447. Twitter: @HeraldLeaderBiz.

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