UPDATE: State pledges $7M in incentives to Carrier as it retains some Indy operations

Indiana officials have offered Carrier Corp. up to $7 million in incentives over the next decade as the firm plans to retain hundreds of jobs at its Indianapolis operations and spend $16 million to upgrade its facility for gas furnace production.

Carrier announced the terms prior to a Thursday afternoon announcement to be attended by Carrier officials, President-elect Donald Trump and Vice President-elect Mike Pence. The announcement also was expected to include details of the multimillion-dollar investment in Carrier's Indianapolis furnace plant. An IBJ reporter will be tweeting news from the event here.

"Carrier will designate its Indianapolis manufacturing facility as a Center of Excellence for gas furnace production, with a commitment to making significant investments to continue to maintain a world-class furnace factory," the firm said in a written statement Wednesday.

The statement said Carrier would "continue to manufacture gas furnaces in Indianapolis, in addition to retaining engineering and headquarters staff, preserving more than 1,000 jobs."

Carrier on Wednesday also said that incentives from the state played a big role in backtracking on a decision to move its Indianapolis manufacturing operations to Mexico, which would entail the loss of 1,400 local jobs. The company was one of Trump’s frequent targets on the campaign trail, and it recently entered negotiations with the state to switch its plans.

A source familiar with the deal said Carrier would receive $5 million in conditional state tax credits ($500,000 over 10 years) and $1 million in training grants that would be paid as soon as they are needed. The credits would be contingent on Carrier meeting the job-retention numbers.

The company would also receive an amount equal to 7 percent of its capital investment, up to a maximum of $1 million. The $1 million would be be realized with a $16 million investment.

Indiana officials said prior to the announcement that it was rare to give a firm incentives for simply retaining jobs, as opposed to creating them. However, there was precedent, they said.

The Carrier deal would be the fifth since 2009 aimed strictly at job retention, officials said. And the cost per retained job would be $6,548, which is less than the average of $10,050 per retained job in the previous deals.

A report in The Wall Street Journal on Thursday morning said Carrier would retain 800 manufacturing workers in Indianapolis and an additional 300 research and headquarters positions that weren’t slated to go to Mexico.

The company still plans to move 600 jobs from the Carrier plant to Mexico, according to report. It also will proceed with plans to close a second Indiana plant in Huntington that makes electronic controls, moving another 700 jobs to Mexico.