Oklahoma Leaders OK Funds for Soy Protein Processor Expansion Project
Daily Oklahoman (Oklahoma City) -- July 28, 2012 -- A state agency approved a $4.35 million financial deal Friday to help with a $30 million expansion project for a soy protein processor in Pryor.The approval by the state Council of Bond Oversight authorizes the Oklahoma Development Finance Authority to issue a revenue note for the Solae plant in the Mid-America Industrial Park.
Michael Davis, president of the Oklahoma Industrial Finance Authority, said the deal allows Solae to construct a building and make machinery and equipment updates.
The Pryor plant, which has 178 employees, is expected to add 48 jobs by the third year of the expansion.
Solae, which is owned by DuPont, will buy the $4.35 million note and then will be repaid by the state over the next 10 years with state withholding taxes collected from the Pryor plant employees, Davis said.
More than enough money is coming in from the withheld taxes to make the payments; the annual debt service is projected at $445,306 and the estimated annual withholding for current Solae employees is $468,314, with that increasing to $595,103 after the expansion.
The Oklahoma Development Finance Authority gave its approval to the arrangement earlier this week.
The note agreement will have a 2 percent fixed rate of interest, according to papers provided to Council of Bond Oversight members.
It represents about 14 percent of the $30 million project.
The taxes collected from employees will be deposited in a special state account.
The arrangement was established in a 2002 law; it was reviewed and upheld in 2004 by the state Supreme Court.
Money for the expansion comes from a program that was allowed to award $100 million for various economic development projects.
It has awarded or committed $61.75 million so far, Davis said, which includes $20 million approved two years ago for the Goodyear plant in Lawton and $15 million awarded also in 2010 to the Hitachi plant in Norman.
The revenue notes are considered to be special obligations of the Oklahoma Development Finance Authority and are not construed to be an obligation of the state.
(c)2012 The Oklahoman
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