WireCo WorldGroup announced Thursday morning it plans to invest $13.5 million in Pettis County to expand its operations in Sedalia.
WireCo WorldGroup is a leader in wire and synthetic rope manufacturing. Officials from WireCo, located at 24150 Oak Grove Lane in the Thompson Industrial Park, met with the Pettis County Commission to discuss Industrial Development Revenue Bonds.
The expansion includes adding almost 92,000 square feet to the facility along with bringing in 20 machines, mostly from the St. Joseph plant, that help in the process of making rope and strands.
“Besides increasing our capacity, it will increase our product capability,” said Phillip Crouse, senior vice president of North American operations. “We can build new products here that we’ve never made before. … Right now we’re making underground mining flattened strand and product for the oil and gas market. This will give us the capability to go up to 5-inch diameter drag lines.”
WireCo also manufactures products for bridges and recently worked on the Oakland Bay Bridge and the Brooklyn Bridge and is working on the Manhattan Bridge, Crouse said. He added that WireCo also manufactures all the San Francisco cable car ropes and the ropes for aircraft carriers that catch the planes when they come on the deck.
WireCo has plants across the United States and in Europe, Mexico and Brazil. The expansion could have occurred at another U.S. plant, but WireCo officials decided to expand in Sedalia, home of WireCo’s largest facility. The St. Joesph facility will be closing and consolidating with the Sedalia facility.
“We’ve been here a long time and this is the biggest plant we have, so it made sense to expand here. It’s nice to grow where we’re familiar and it’s a good community to draw from,” Crouse told the Democrat. “… (Bringing the St. Joesph plant here) will consolidate the manufacturing into one plant. It reduces the cost by having it in one place. Sedalia is also a distribution plant, so it will help cut down on shipping costs from St. Joseph.”
The expansion will add about 26 jobs in Sedalia with an average salary of $50,000. The construction is expected to be completed by the end of the year and the purchase and relocation of equipment should be completed by the end of 2017.
To help with this expansion, WireCo will be utilizing Chapter 100 bonds, an incentive offered under Missouri law, through the assistance of Pettis County. Jim Caldwell, of Gilmore & Bell, joined WireCo officials to help explain the process.
WireCo is located in one of Pettis County’s Enhanced Enterprise Zones, which allows for property tax abatement, although it can only last for a limited period of time and this EEZ will expire in 14 years. WireCo went the route of purchasing bonds to get 15 years worth of real property abatement, Caldwell said.
“Chapter 100 bonds are a mechanism that authorizes cities and counties to issue bonds to help these industrial development projects,” Caldwell explained. “By issuing the Chapter 100 bonds that allows you to not only have real property tax abatement but also personal property abatement for the equipment that’s going to go in this facility. This is an additional incentive offered by Chapter 100.
“In addition, something you can only get with this type of abatement is sales tax exemption on the component parts that go into the building construction.”
It was noted that the abatement is solely for the expansion site, not for the existing site. The amount of taxes that was paid the year prior will continue to be paid.
As part of the bond agreement, the county will hold the title to everything being financed until the end of the 15-year abatement. After a unanimous approval from the County Commission, the bonds are expected to be purchased by WireCo by the end of the year.
“This is a very common mechanism. We’ve done this all over the state,” Caldwell said. “… It’s not something that’s unusual at all, it’s done all over the state as a way to enhance companies to either come to the community or to expand.”
Nicole Cooke can be reached at 660-530-0138 or @NicoleRCooke.