BARTON, Ala. (AP) -- The Retirement Systems of Alabama has agreed to lend an additional $275 million to help get a western Colbert County railcar manufacturing plant back on track.
A spokesman for the National Alabama plant, Peter Earle, said development of the nearly mile-long plant has slowed as the company struggled to find capital investments needed to begin producing railcars.
With the additional loan announced Friday, RSA will have up to $625 million invested before the first railcar is produced. The retirement program is to receive 9.125 percent interest on the total for the 15-year term.
In agreeing to make the loan, RSA chief David Bronner insisted on creating a five-member board to oversee financial decisions until the 15-year loan is repaid as part of the arrangement. Three members were appointed by RSA.
"This is not something (National Alabama) or I wanted to do," Bronner said, "but the other options were 100 percent worse."
The announcement to open the 2 million-square-foot plant at the Barton Riverfront Industrial Park came in July 2007. National Alabama is a separate firm spun off from National Industries Inc., a Canadian rail company.
The outside portion of the plant has been completed, but National Alabama has purchased little equipment to start producing railcars. According to Earle, the company planned to get financing for equipment when construction was complete.
National Alabama contacted RSA as the economy worsened. RSA had previously provided a $350 million construction loan. The company has 100 workers on site at the Barton facility.
Earle said that number is not likely to grow until the economy rebounds, but added the company anticipates retaining those workers.
Company officials plan to produce a speculative railcar this spring to help efforts to land contracts for production orders.