LITTLE ROCK, Ark. (AP) -- Arkansas is set to provide a new steel company with $125 million in financing and a package of tax breaks to build a mill in the northeast part of the state after the Legislature gave final approval to the plan on Tuesday.
By an 81-9 vote, House lawmakers passed a Senate-approved budget bill to fund Gov. Mike Beebe's proposal to provide Big River Steel with a loan and pay some construction costs of a $1.1 billion steel mill the company wants to build in Osceola. In exchange, the company promises to create at least 525 permanent jobs with an average annual wage of at least $75,000 — twice the state's average.
Big River Steel has said it wants to close the deal in the third quarter of this year. The plant will make steel for auto, oil and gas and electrical energy industries.
Some conservatives had lobbied against Beebe's proposal, arguing that the government shouldn't be subsidizing the startup costs for a private business. Nucor Steel, which operates two facilities in the region, also urged lawmakers to reject the plan and said the competition could force it to scale back its Arkansas workforce.
Arkansas voters in 2004 amended the constitution to give legislators authority to borrow money for economic development "super-projects" like the steel mill after the state narrowly missed out on a Toyota truck plant that was eventually built in San Antonio. Arkansas again lost out on a manufacturing facility in 2007, when Toyota opted to build a Highlander SUV plant in Tupelo, Miss.
The steel mill project will be the first time Arkansas issues bonds to fund a "super-project" under that constitutional amendment.