Tax break approved for a company that might be VW, but identity is still secret

Dale Denwalt, Oklahoman
·2 min read
2
Oklahoma Gov. Kevin Stitt signs the LEAD Act on Thursday in the Blue Room at the Capitol with members of the House and Senate behind him: From left, Sen. Chuck Hall, Sen. Roger Thompson, Speaker Pro Tempore Rep. Kyle Hilbert, Rep. Ryan Martinez and Rep. Kevin Wallace.
Oklahoma Gov. Kevin Stitt signs the LEAD Act on Thursday in the Blue Room at the Capitol with members of the House and Senate behind him: From left, Sen. Chuck Hall, Sen. Roger Thompson, Speaker Pro Tempore Rep. Kyle Hilbert, Rep. Ryan Martinez and Rep. Kevin Wallace.

Gov. Kevin Stitt has signed a bill offering hundreds of millions of dollars in tax incentives for a company code-named "Project Connect" to build a manufacturing facility in northeastern Oklahoma.

That company is likely German automaker Volkswagen, according to media reports, but its identity is being kept a secret during negotiations with the Oklahoma Department of Commerce.

Volkswagen company executives are scheduled to meet on Friday to discuss plans for a new U.S. manufacturing plant, according to Reuters, although it's not clear whether that includes Oklahoma or "Project Connect." The plant at the center of Volkswagen's meeting will reportedly be involved in production of the Scout, an off-road electric vehicle.

The bill Stitt signed Thursday afternoon was given final approval by lawmakers just hours earlier. It modifies legislation first adopted last year that was linked to nearly $700 million in capital investment rebates set aside for a different recruitment effort last year. The company receiving these incentives would be allowed to claim an annual rebate on qualified capital expenditures.

To claim the rebates, "Project Connect" would have to spend at least $3.6 billion on its Oklahoma project to be eligible for financial incentives. Additionally, the company would need to hit hiring benchmarks beginning with at least 500 full-time workers in its first year and ramping up to 3,500 full-time staff by years four and five.

If "Project Connect" fails to ink a deal with the Oklahoma Department of Commerce by April 15, the incentives in the bill Stitt signed would expire and the money would be returned to the state's General Revenue Fund.

State Rep. Ryan Martinez, R-Edmond, said Thursday that the average salary for new employees hired by the company would be about $75,000 a year. As vice-chair of the House Appropriations and Budget Committee, Martinez has helped shepherd the bill through the legislature.

Oklahoma Gov. Kevin Stitt signs the LEAD Act on Thursday in the Blue Room at the Capitol.
Oklahoma Gov. Kevin Stitt signs the LEAD Act on Thursday in the Blue Room at the Capitol.

The legislation signed by the governor Thursday reduced the ultimate number of employees required to qualify from 4,000 to 3,500.

The original version of the LEAD Act was signed by the governor less than a year ago as Oklahoma tried to recruit Panasonic to the Mid-America Industrial Park in Pryor. Panasonic ultimately chose to build its battery manufacturing plant in Kansas.

This article originally appeared on Oklahoman: Stitt OKs incentives for company identified only as "Project Connect"