The Paducah City Commission and the McCracken County Fiscal Court passed guidelines for granting economic development incentives, then put them immediately to work toward an estimated $1.3 million to Infiniti Media Inc. at a joint meeting Tuesday.

"Infiniti is the first of many," Mayor Bill Paxton said. "We are going to have to offer incentives, and we're prepared to do that. We need to have a road map to go by."

County-Judge Executive Danny Orazine said it makes sense to put the rules in place.

"Every piece of money the county gets ... there are criteria with it," he said. "Infiniti very much fits these criteria and then some."

Infiniti, based in Torrance, Calif., announced last week it had chosen Industrial Park West for a manufacturing and distribution facility that will eventually employ more than 100. The two governments agreed to split the incentives evenly, with the bulk $900,000 paying the lease on the site for the first three years.

The city and county will also build a rail spur for the site, but its design, and therefore its cost, remains unclear. Paxton and City Manager Jim Zumwalt said they have used $200,000 in their calculations but have no firm estimate of the actual cost.

The remaining payouts include relocation grants over a nine-year period totaling $91,512; travel assistance during construction and start-up, $30,000; $50,000 to secure a state industrial development bond; and $50,000 in a contingency fund. The language of the ordinances both bodies introduced Tuesday characterized the amounts as maximums, so the ultimate payouts may be less.

The city commission will pass the ordinance at its meeting Tuesday. The fiscal court will pass it either at its meeting Monday or the next meeting, in February, County Administrator Steve Doolittle said.

The incentives were the first considered under the new guidelines, identical versions of which were passed by both commissions, which set up criteria for a company to qualify for the assistance. Drawn up by a committee including Zumwalt, Doolittle, City Attorney David Denton and representatives from the Greater Paducah Economic Development Council, the guidelines suggest that the company should:

Invest at least $350,000 over three years in real estate or business property, not including inventory or supplies.

Be considered a basic industry, such as manufacturing warehousing, industrial or selected service industries, but not retail.

Create at least 15 permanent, full-time jobs that pay at least the minimum for state grant assistance, currently $9.70 hourly.

Pay at least half the cost of its employees' health insurance.

The guidelines also include a recapture clause, which gives the governments the option of demanding a refund with interest if the company fails to meet the criteria within three years. The governments may lessen or waive the reimbursement if the company made a good faith effort to do so but failed because of circumstances beyond its control.

Orazine again praised the working relationship between the two commissions, saying it made the Infiniti deal possible and rejected critics who say the two governments are too cozy. "If we're not working together closely," he said, "we're out of the ballgame."
 

As published in the Paducah Sun on January 21, 2004

By C.D. Bradley cdbradley@paducahsun.com--270.575.8650