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Officials from the Indiana Economic Development Corp. will appear before a committee of state lawmakers and the state budget director Tuesday to ask for approval to spend $180 million to lure a pair of multibillion-dollar advanced manufacturing projects to Indiana.
The IEDC is requesting $100 million in performance-based incentive grants for a company that plans to invest about $4.1 billion in an advanced manufacturing facility that would result in 2,700 jobs, according to the Dec. 19 agenda for the State Budget Committee. The agency also is asking for $80 million in incentives for a company that plans to put $3.1 billion into a facility that would create 800 new jobs, the agenda reads.
Critical details about the projects, including the names of the companies behind them, where they would be located and whether or not the two developments are related, were not disclosed in the public agenda.
IEDC spokesperson Erin Sweitzer said in an email to IBJ that the money is “for potential projects not yet public.” She declined to share more details.
The money would come from an IEDC $500 million deal-closing fund that was approved by state lawmakers in this year’s budget, but the agency needs the State Budget Committee’s blessing to move forward with the transactions.
The IEDC is also asking for $71.7 million to acquire roughly 750 acres of land that is already under option in Boone County for the LEAP Research and Innovation District to support an estimated $800 million investment in the first phase of a company’s multibillion-dollar information technology center project. The IEDC will sell the property to the company when it receives a commitment, according to the agenda. LEAP stands for Limitless Exploration/Advanced Pace.
It’s unclear if that development is the same as a $3.2 billion data center project that is considering Indiana for its next facility. In June, the State Budget Committee gave the IEDC the go-ahead to spend $16 million to acquire 290 acres of property in Boone County for that project.
The IEDC is also asking for $26 million to invest in roadway improvements, fiber extension and other utility needs for the LEAP District.
Finally, the agency is requesting $15.8 million to acquire around 257 acres in Howard County to accommodate two electric vehicle battery plants in Kokomo. Automaker Stellantis and battery manufacturer Samsung SDI are behind those projects, which together are valued at $5.7 billion and are expected to result in 2,800 jobs. One plant is expected to open in early 2025, while the other is slated to come online in 2027.
Some of that land will be marketed to other potential buyers, Sweitzer said.
In October, Stellantis and Samsung announced they would partner on a second, $3.2 billion battery plant that is expected to open in early 2027 and also create up to 1,400 jobs.
For the initial plant, the IEDC offered the partners up to $37.5 million in tax credits, as much as $20 million in redevelopment tax credits and up to $2 million in training grants.
For the second plant, the IEDC offered up to $39.5 million in conditional tax credits and training grants, up to $22 million in redevelopment tax credits, and up to $115 million in structured performance payments.
The money for land acquisitions would come from an IEDC site acquisition fund that was put into the state budget. It is a revolving fund, meaning that any money earned from selling the land to a company would go back into the fund.
It’s the third time this year the IEDC has come before the committee with significant funding requests.
The committee in August approved the agency’s request for $120 million in performance-based incentives for a company planning to invest about $3.2 billion in a new facility that will create 1,400 high-wage jobs. Though it wasn’t known publicly at the time, the money was for the Stellantis battery plant in Kokomo.
In June, the committee gave the IEDC the green light to spend $122 million to purchase roughly 1,000 acres of land—about $120,000 an acre for mostly rural farmland in Boone County—as part of an incentive package to lure a global semiconductor manufacturer to central Indiana. The mystery company is considering the LEAP District for its $50 billion plant, according to state officials.
The State Budget Committee will consider the agency’s requests at its Dec. 19 meeting.
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$ 1,000,000,000 here, $500,000,000 there…at some point it seems like it is Monopoly money. Completely support attracting investment into Indiana, but wow, this is incredible amounts of cash.
I wonder how much water they’ll try and steal for these.
The state is the legal owner of the aquifer water that would be required, and companies will be charged for the water they consume.
No, the owner of the real estate beneath which an acquirer exists owns the water.
Indiana law treats groundwater like it’s an everlasting and inexhaustible resource. There are limits to how much ground water can be extracted before bad things start to happen, like other peoples wells go dry, or worse yet polluted water is drawn into the aquifer.
You are correct Robert F. The public needs to understand this. If they want complain about “stealing their water” talk to the landowners that have sold it.
Can the ibj create a list of everything the state is asking for and these possible projects?
Robert. Landowners do not own the aquifer beneath them. Based on our loose framework for water rights in Indiana (and based on the Nov24th IBJ article on this topic) a homeowner above water wells or adjacent to a river can access the water but they do not own it. If they pull a certain amount they have to register the usage. If a small well is impacted by local development homeowner has a right to compensation. But the landowners to not own the water rights below them.
The math here gets whacky, and hard to tell which share of the 500M is for which project. If you add up all in the article we are spending $666.5M of the available $500M. Also the potential projects add up to about $70Billion. None of this seems correct or feasible.
I’m just looking at the Colorado River and it probably started like this.
There’s a distinction between Indiana’s “land and pump” rules and hard allocations in Western Water Rights. In Indiana, one merely has to own land over an aquifer in order to pump. And there are few limitations on how much one can pump.
In the West, they follow the “first in time, first in right” principle. If you started taking a defined quantity of water from a river or aquifer in 1880, your rights are senior to everyone who started taking water after you, and you are the first in line to withdraw up to your allocation amount. If that’s all there is, everyone junior is out of luck.
In Indiana, there are no fixed rights…except under the Bigger Pump principle: if your bigger pump dries up a neighbor’s well, you have a responsibility/liability to restore a quantity of water to the neighbor (either by drilling their well deeper, or providing water from yours).
Pause on battery manufacturing capacity. EV sales are on pause.
This is simply business as usual. Trust me, every state shells out BIG money to get companies to invest in their state. Honestly if Indiana is going to compete with its peers let alone sunbelt states, the state is going to have to give HUGE incentives to attract companies. States are constantly competing with each other for these companies. I use to live in Louisville and trust me city county councilors there was always wondering how Indy and its metro area were always on the radar for economic development and how could they reap some of the same benefits. They soon realized that the only way to attract companies from California or Florida to move to Kentucky is to offer HUGE incentives. Thats just the facts and that’s exactly how Nashville Tennessee and other places have done it.
I wonder why IEDC has a $750M fund in Cayman Islands where basically they sell us, the economy:
https://www.sec.gov/Archives/edgar/data/1847241/000110465921041102/tm219358-1_s1.htm
Oh, and a bad one, as the “$800M” UK company they once purchased is “gone”:
https://www.prolificnorth.co.uk/news/tkb-terminates-wejo-merger-agreement/
https://www.prolificnorth.co.uk/news/millions-of-gm-customers-data-potentially-compromised-as-wejo-group-lays-off-all-global-employees-meanwhile-p45s-sent-to-the-wrong-people/
https://www.iedc.in.gov/events/news/details/2022/08/22/andretti-global-plans-200m-racing-technology-hq-in-fishers-indiana-remains-pole-position-for-global-racing-industry
And why are we paying for this?
https://secure.in.gov/apps/iedc/transparencyportal/viewtaxgrantloancontract/d656f81db090ec118d20001dd804b9c1