by J.D. Davidson
Ohio government leaders say nearly $2 billion in incentives and tax breaks given to Intel to build a $20 billion manufacturing facility outside of Columbus will come back to benefit the state.
Ohio Department of Development Director Lydia Mihalik said Friday that Intel will receive a $600 million grant for building its two plants, plus another $691 million in infrastructure development. The company also will be eligible for another $650 million in job creation tax credits over 30 years.
Mihalik said the state is expecting to see a 16-to-1 return on investment, and every 6 cents the state invests, Intel is expected to invest $1.
“When you look at what we are giving Intel and what we are getting in return, some may wonder if it’s worth it. The answer is, ‘yes,’ ” Mihalik said. “This is the largest incentive package in the state of Ohio’s history in order to land something of this magnitude.”
The incentives still must be approved, Mihalik said. The state’s taxing authority will have final approval over the job creation tax credit, and the General Assembly must sign off on the production grant and infrastructure improvements. Mihalik characterized both as direct cash incentives.
Mihalik would not say what incentive from local communities have been offered.
The $600 million grant will go directly toward helping Intel offset costs of facility construction, which Mihalik said is 20%-30% more expensive in the U.S. than in Asian markets. The money is performance based, meaning $300 million would be given for each plant completed by 2025.
“If Intel fails to deliver on their commitments, which we are very confident that they won’t, then they will not be eligible for the grant,” Mihalik said.
The infrastructure improvements include $101.2 million for water and wastewater capacity upgrades, $290 million in road work and a state of the art water reclamation facility.
Intel plans to invest $20 billion on a new computer chip facility in New Albany that will create 3,000 full-time jobs, 7,000 construction jobs and what Gov. Mike DeWine called tens of thousands of additional indirect and support jobs. The project is expected to add $2.8 billion to the state’s annual gross product.
State officials said the average salary of the jobs created is $135,000 annually.
“These aren’t just jobs. They are opportunities for Ohioans,” Mihalik said. “They are opportunities that simply don’t exist right now. Moms and dads won’t be sending their kids off to other states to get these jobs. They can stay right here.”
– – –
J.D. Davidson is a veteran journalist with more than 30 years of experience in newspapers in Ohio, Georgia, Alabama and Texas. He has served as a reporter, editor, managing editor and publisher. He is a regional editor for The Center Square.
Photo “Lydia Mihalik” by Lydia Mihalik. Background Photo “Intel” by Kazuhisa Otsubo CC BY 2.0.
