BRATTLEBORO — The Selectboard approved a cocktail of state and local economic development funds to support the expansion of G.S. Precision.
At its Dec. 1 meeting, the board OK'd a $200,000 loan and two tax stabilization agreements, and discharged mortgages held on the Exit One Industrial Park, where the company makes high-precision machined components and sub-assemblies for the aircraft engine, aerospace, medical, fiber-optic, automotive, specialty bearing, and other commercial industries.
Town Manager Peter Elwell said that the town's portion of the incentive package resulted from “intense conversations” over recent months.
Word hit the street earlier this year that one of Brattleboro's high-wage employers sought to expand its business, only not in Brattleboro.
The news that G.S. Precision was exploring expanding its manufacturing business in New Hampshire - and taking 323 jobs out of town - sent Brattleboro Development Credit Corp. (BDCC), the town of Brattleboro, and state economic development agencies scrambling to offer the company incentives to remain at the Exit One Industrial Park.
BDCC has sought to attract new businesses and support existing businesses that pay higher than the annual average wage for the county.
Depending on which numbers one looks at, BDCC says the county's annual average wage is $38,000. Based on U.S. Census data, BDCC also reports that Windham County's median household income is $50,234.
The goal of attracting or keeping high-paying employers took on greater importance with the closure of Vermont Yankee nuclear plant which offered an annual average wage of $100,000.
According to documentation from the town of Brattleboro, G.S. Precision's proposed 25,000 square-foot expansion project includes adding onto properties at 101 and 347 John Seitz Drive in Brattleboro, creating more employee parking, and purchasing equipment.
The more than $18 million expansion project could also add 100 jobs. According to a press release from the BDCC this summer, G.S. Precision has undertaken the project in part to meet demands of proposed contracts.
At the Dec. 1 meeting, the Selectboard approved a $200,000 loan for the project. Funds for the 7-year, 3 percent loan came from the town's revolving loan fund. Seed money for the revolving loan fund came from the state via the federal government.
Board members also approved two tax stabilization agreements - one for the new property and one for new equipment. The agreements only pertain to the municipal portion of the property tax and exclude the educational portion.
The real estate tax stabilization agreement ensures that for 10 years, G.S. Precision will pay 35 percent of municipal property taxes on its new construction; in other words, a 65 percent discount on municipal taxes on newly constructed property. The property tax on the older section of its buildings remains at 100 percent.
Taxpayers will still see G.S. Precision's portion of real estate tax increase under this agreement, said staff members.
The board approved a similar agreement for taxes paid on personal business property.
According to a memo by Assistant Town Manager Patrick Moreland, G.S. Precision anticipates purchasing $4.7 million in new equipment in 2016. The second tax stabilization agreement provides for taxing the new equipment at 25 percent of fair market value for 10 years.
Finally, the board authorized Town Manager Peter Elwell to discharge a portion of two mortgages held by BDCC to the town dating from 1984.
According to Moreland's memo, the town served as a municipal applicant for BDCC in the early 1980s to secure a $1.4 million federal Urban Development Action Grant. The money went towards developing the Exit One Industrial Park. Development and property sales were slower than anticipated.
In 1996, BDCC and the town amended their agreement to allow for the town to gather net proceeds from sales at Exit One.
Moreland wrote that Town Attorney Robert Fisher, of Fisher & Fisher, has determined that it's unlikely there will be net proceeds.
The agreement also required BDCC to seek the board's approval to sell property at the industrial park. On Dec. 1, the board approved the sale of two lots and parking rights on a third lot.
Former Selectboard member Dora Bouboulis expressed concern that the town's funding was going to an established company with access to its own capital, rather than to start-ups.
The project's incentive package also includes state funds, such as $1 million in Vermont Employment Growth Incentives. that will be paid to G.S. Precision over several years, as well as $2 million from the Windham County Economic Development Program and $1 million from the federal Community Development Block Grant program (also called the VCDP).
Calls to G.S. Precision were not returned by press time.