Consultants, Nucor, Correnti Talk Big River Steel in 5-Hour Session

by Michael Stratford, The Associated Press  on Tuesday, Mar. 26, 2013 7:16 am  

Lawmakers on the Joint Agriculture, Forestry and Economic Development Committee quiz consultants, steel executives and economic developers about the $1.1 billion Big River Steel project in this photo by U.S Rep. Duncan Baird, R-Lowell, posted to Twitter. (Photo by Duncan Baird)

Several lawmakers raised concerns about the size of the corporate income tax credit that Big River Steel would receive for recycling scrap metal and turning it into usable steel products. The credit, which would cover 30 percent of the cost of the facility's equipment and its installation, would cost the state about $216 million over 14 years, state officials estimate.

Grant Tennille, Arkansas' top economic development official, defended the tax incentive, arguing it wasn't a direct cost to the state but rather "an opportunity defrayed" since that state wouldn't realize that revenue without having Big River Steel.

He also said that the credit would only be redeemable if the company had a corporate income tax liability, which would mean that it was doing well and providing a benefit to the state economy.

Lawmakers on Monday heard more than five hours of testimony from the consultants, state finance and economic development officials, the steel mill's investors, and Nucor Steel officials.

Nucor representatives urged lawmakers not to subsidize some of the costs of building Big River Steel, arguing that the addition of another steel facility in northeast Arkansas would have "a direct and negative impact" on their business. They said the increased competition could force them to scale back its Arkansas workforce.

John Correnti, a former Nucor executive, who is leading the Big River Steel project, told lawmakers that his new venture would produce specialized steel products that don't compete directly with Nucor.

More: Read more notes from Monday's meeting by Arkansas Business reporter Mark Carter.

(Original photo by U.S. Rep. Duncan Baird, R-Lowell, available on Twitter here.)

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