Don Davis, Forum News Service, Published March 25 2010
Minnesota eyes tax breaks for wind-turbine makerST. PAUL – A European wind-turbine manufacturer is more likely to build plants in Duluth and the Iron Range if Minnesota gives it tax breaks, backers of the proposal tell legislators.
A House jobs bill contains a provision to give the manufacturer $12.7 million in tax breaks, and a similar Senate bill is expected to include it, too, in an effort to compete with an Ohio offer. Votes on the two measures could come by Monday, when lawmakers begin a weeklong Easter-Passover break.
The tax breaks would come in Job Opportunity Building Zones already set up to eliminate a variety of taxes for 10 years. JOBZ is a controversial program established to help rural Minnesota attract and retain businesses.
While the company would get tax breaks, 1,350 employees and others in related businesses would pay $24.3 million annually in income, property and sales taxes, the Duluth-based Area Partnership for Economic Expansion told lawmakers.
If tax breaks are granted, the company could break ground by this July 1, Rep. Ron Reinert, DFL-Duluth said.
Minnesota needs to build a financial package to compete with Ohio, the other state still in the running, Reinert said. “It’s got to happen this year.”
The company, whose name and exact European location remain private, would build a plant in the Hibbing or Grand Rapids area to make 180-foot-long turbine blades. When the plant is fully operational, the plant would employ about 600 people.
In Duluth, a plant eventually employing 700 people would be built to make 200,000-pound tower-top units that hold electric generators. Also, 50 people would be in the company’s Duluth headquarters.
House Majority Leader Tony Sertich, DFL-Chisholm, said he expects the tax-break provision to pass, and Reinert said it has Pawlenty administration support.
Usually, JOBZ is controversial, but Sertich said he does not expect a problem this time. “We’ve got to be creative in attracting jobs to Minnesota.”
Overall, JOBZ is due to end before the 10 years is up, but the new provision extends the specific northeastern Minnesota project for a full 10 years.
Reinert said he worked through the weekend to get the provision folded into a jobs bill.
Davis reports for Forum Communications Co.