Incentive package tweaks are on fast track as multibillion-dollar company eyes Pryor site

Lawmakers on Monday took steps to update an economic development incentive package that would be offered to the unnamed company that reportedly is Volkswagen.

A company that is looking to build a new battery plant is close to deciding whether its new facility will be located in Oklahoma or Canada.

With the clock ticking, a joint legislative budget committee gave approval to legislation that would reduce from 4,000 to 3,500 the number of jobs the company must create within four years in order to be eligible for incentives through the state’s LEAD Act. Senate Bill 1176 also would return the $698 million in economic development incentives to the state’s general revenue fund if the business doesn’t make a binding commitment by April 15.

Last year, lawmakers created the LEAD — for Large-scale Economic Activity and Development — Act and prefunded the new economic development incentive as the state was trying to lure Panasonic to build an electric vehicle battery plant in Pryor. The law currently requires that a company invest at least $3.6 billion and create 4,000 new jobs within four years to be eligible for the incentives.

Without naming the company, Senate Appropriations Committee Chairman Roger Thompson, R-Okemah, said he expects that Project Connect — the codename for the possible deal — could result in 7,000 new jobs and a more-than $5 billion capital investment. Lawmakers are seeking to lower the employment requirements because the company’s officials thought it might not hit 4,000 employees within the first few years, although they expect to hit that hiring mark eventually, Thompson said.

“I think we’ll bring a great deal of economic revenue to the state of Oklahoma,” he said.

Average pay for the jobs will be $75,000 annually, about $20,000 more than the jobs projected for the Panasonic battery plant, said House Appropriations Committee Chairman Kevin Wallace, R-Wellston.

Legislative leaders are expected to fast track the legislation this week, and company leaders are expected to make a decision Friday, with a formal announcement coming the second week of March.

The mid-April clawback deadline for the financial incentives gives the company some wiggle room, Wallace said. He said the legislation puts Oklahoma in a “strong position” to land the company.

If the state closes the deal, the Legislature could be asked for additional funding for the project later. The company is asking that $445 million in site work be completed at the industrial park. A portion of that funding may have to come from state coffers. Wallace said state leaders and Department of Commerce representatives signed a letter vowing to help the company with its additional requests.

Gov. Kevin Stitt said Friday that Oklahoma is “really, really close” to landing the deal, but he noted his disappointment that the project had become ensnared in politics. He did not go into details when pressed about the politics that were occurring.

“Project Connect would transform Oklahoma’s entire economy and benefit all 77 counties,” Stitt spokeswoman Carly Atchison said Monday. “The only loser in the deal would be Canada.”

In the House committee hearing, Wallace and House Majority Floor Leader Jon Echols, R-Oklahoma City, agreed that if the state lands the deal, the Legislature should put a renewed emphasis on trying to retain and grow some of Oklahoma’s existing large employers.

SB 1176 passed the joint legislative committee with a lone “no” vote from Rep. Gerrid Kendrix, R-Altus.

Online news outlet The Frontier was the first to report that Volkswagen, a German automaker, is the company in question.