Business Facilities - May 2008 - (Page 14)

COVER STORY Economic Development in a Flash September 2006 Tool installation begins at the former Micron plant. This technical component of building out the facility would continue for approximately 16 months. November 2006 IM Flash announces that major construction has begun and is ahead of schedule at the 300mm semiconductor fabrication plant in Lehi. Meanwhile, the joint venture is producing NAND products at Micron’s headquarters in Boise. an average of $50,000, or 224% of the county’s 2006 median wage. Over 10 years, the company is expected to pay $1.1 billion in wages to its employees. In late 2006, IM Flash commenced what is now believed to be the fastest semiconductor ramp-up ever. It would be a $3 billion investment on the part of the parent companies. Brad Mortensen, facilities manager for the joint venture, was given instructions to assemble a construction team, including local con- tractors, that could have the old Micron facility up and running within 11 months. The major construction was completed in 2007, leaving the first few months of 2008 for finishing the tool installation. In the end, the factory would use 11.25 million construction hours and 225,000 cubic yards of concrete. By April 2008, the facility was nearly at full staff, with about 1,600 jobs filled, nearly half of them in Q&A with State of Utah Officials Business Facilities: Can you tell me how your office approaches an economic development project such as IM Flash? Jason Perry, Executive Director, Governor’s Office of Economic Development: There are a couple key pieces to any great recruitment deal. It starts with a company looking for a spot, and then our office engages them because we’re the ones who help provide the incentive for a business to relocate, and we help provide the logistics to help as people are scouting for a location. We connect people with all the resources and tools of the state, and then ultimately we’re engaged because we’re the one who work out the state and local incentives. Our statute requires that before we give state incentives there be local participation as part of the deal, because it really is a great opportunity for all segments of government to work together for these kinds of projects. In this case, we worked closely with Lehi city in Utah for its piece of the incentive as well as ours. BF: Can you give some specifics about the incentive process? Perry: It’s an interesting time to ask because we just had a change in our legislative session. We have two key funding mechanisms. One of those is our Industrial Assistance Fund, which is a cash grant or loan program. It’s always in the form of a grant because companies in the early stage of a move are not really looking for loans; they’re looking for money that helps them relocate, build new facilities, and start hiring people. We can give some money from that fund for those upfront costs of moving. 14 M AY 2 0 0 8 PHOTO CREDITS: IM FLASH TECHNOLOGIES The second is the Economic Development Tax Increment Fund, which is a rebate of the corporate income, sales, and withholding tax. We can return up to 30% of that corporate income/sales/withholding for up to 20 years. The changes that just happened in our legislative session are quite progressive for our state. They’ve been converted to tax credits, so we can provide a refundable tax credit to the company for that 30% over 20 years, which is important to the companies. The refundable nature makes it so, in those beginning years, we can make sure they’re getting the right kind of dollars. For the deal itself, we can rebate up to 50% of the income/ sales/withholding tax in any given year as long as, over the life of the deal, it doesn’t exceed 30%, which means we can frontload certain pieces of our incentives as well, which is a huge benefit for companies looking to relocate.

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Business Facilities - May 2008 Contents First Word Snapshots The UK's Most Lucrative Locations, Pound for Pound Economic Development in a Flash Corporate Moves: Massachusetts Florida: A Ripe Climate for Innovation Innovating Big in Rhode IIsland Retail Set to Ride Out a Recession Corporate Moves: New Jersey South Carolina: A Sweet Spot in the Southeast Endless Opportunities in North Carolina Economic Awakening in the Mohawk Valley Metro Spotlight: Alexandria, LA Where Call Centers Call Home Texas Receives First Business Facilities State of the Year Award Advertiser Index Inside Livexchange

Business Facilities - May 2008

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