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Power plant project gets $600 million

April 20, 2007, Charleston Gazette, By Sarah K. Winn, Staff writer.

The West Virginia Economic Development Authority committed Tuesday to help fund a $600 million construction project at the Longview Power Plant in Monongalia County.

At Tuesday’s monthly meeting, the authority gave preliminary approval for possible future revenue bonds for Longview Power LLC, the plant’s developer.

The resolution allows Longview to begin developing solid waste disposal and recycling facilities at the plant, said Cam Siegrist, counsel for Longview.

The Internal Revenue Service requires the resolution so Longview can use future bond funds to pay for expenses accrued now, said David Warner, WVEDA’s executive director.

The company likely will come back over the next few years to request revenue bonds from the authority, Siegrist said.

Also, the authority approved a $75 million bond for additional work on Appalachian Power’s Mountaineer Plant in Mason County, which began in 2005.

In other financial allocations, the authority gave preliminary approval for two nearly $800,000 7-year loans-one to Merrick Engineering, Inc., in Clarksburg and another to Tramco Services, Inc., in Shrewsbury.

Merrick, which manufactures hangers and closet accessories, plans to purchase and install injection-molding equipment at its Clarksburg manufacturing facility.

Tramco, an electrical motor repair and machine shop, will finance a 6.5-acre site and renovate about 30,000 square feet of manufacturing space to create a new facility in Campbells Creek.

The authority also gave final approval for a $5 million loan to Recycle West Virginia LP and approved a high-growth business investment tax credit of up to $50,000 to William P. Zitter of Huntington.

Also, at the authority’s June meeting, the authority will be given updates on the uncompleted projects funded by the Economic Development Grant Committee two years ago.

Currently, $182 million of the $225 million allocated has been spent, and the projects risk losing the money if not completed by Dec. 31.

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Charleston Daily Mail

State agrees to issue bonds to fund power plant

George Hohmann, Daily Mail business editor, Friday April 20, 2007

The West Virginia Economic Development Authority has given preliminary approval for the issuance of up to $600 million in tax-free bonds to help finance portions of the Longview Power Plant near Morgantown.

The state Public Service Commission granted permission to build the $1 billion coal-fired plant last year. The Economic Development Authority bonds would help finance parts of the plant such as air and water pollution control systems.

Thursday's vote is the first step in issuing bonds. The plant's developers would have to come back to the authority at least two more times before bonds could actually be issued.

The bonds would be backed by revenue from the power plant and would not be an obligation of the state.

Also on Thursday, the authority took the final step toward issuing up to $75 million in tax-free bonds to help pay for parts of the scrubber Appalachian Power Co. has installed on its Mountaineer power plant in Mason County.

The authority agreed in 2004 to issue up to $567.4 million in bonds for the project. It had issued $50.3 million in bonds last year.

The scrubber went into operation in February.

Also at the meeting, the authority gave final approval for a $5 million loan to Recycle West Virginia Limited Partnership of Princeton. The company plans to purchase 14 acres in an inactive rail yard known as the Princeton Roadway Shop and refurbish the five buildings on the site.

The company will use the low-interest state loan to purchase and install a shredder and related equipment in a 56,000-square-foot building on the site, according to a project summary provided by the authority.

In other action, the authority gave preliminary approval to:

A $787,500 loan to Tramco Services Inc., doing business as Kanawha Electric & Machine Co. Tramco acquired the assets of Kanawha Electric in 2002.

The Kanawha Electric operation will move from Shrewsbury to a 6.5-acre site at Campbells Creek. Kanawha Electric will renovate existing buildings at Campbells Creek and will erect a new building for its motor repair and machining operation.

A $787,378 loan to Merrick Engineering Inc. to purchase and install injection-molding equipment at its Clarksburg plant. Merrick is a manufacturer of hangers and closet accessories.

Also on Thursday, the authority:

Agreed to sell 7.44 acres in the Three Springs Business Park near Weirton to Wal-Mart. David Warner, the authority's executive director, said, "Our acres are just part of the property to be bought by Wal-Mart."

He said the retailer plans to build a super center adjacent to the general office complex previously occupied by Weirton Steel Corp.

Amended a lease it has with Bombardier to add a 21,000-square-foot building at the Harrison-Marion Regional Airport in Bridgeport. Bombardier repairs and refurbishes aircraft at the airport.

Received a report that showed $181.6 million or 81 percent of the $225 million in grants approved by the West Virginia Economic Development Grant Committee has been disbursed. A total of $2.6 million was disbursed to 14 projects during March.

Agreed to extend the deadline for completion of the marina portion of the West Virginia Public Theater & Marina project in Morgantown from Dec. 31, 2006, to Dec. 31, 2007.

The city received a $13.9 million grant for the project from the West Virginia Economic Development Grant Committee in 2003. As of March 31, the city had spent $5.2 million.

State Commerce Secretary Kelley Goes, who chaired the meeting, said the status of all of the grant committee projects will be reviewed at the authority's June meeting.

Decided to wait until next month before determining whether it will renew or re-bid its legal contracts with the law firms of Spilman Thomas & Battle and Bowles Rice McDavid Graff & Love.

Granted state tax credits to William Zitter of Huntington under the High Growth Business Investment Tax Credit. This credit, passed by the Legislature in 2005, is designed to encourage investment in potentially high-growth research and development businesses in the state.

Zitter is investing in Vandalia Research Inc., a spin off of Marshall University research. Vandalia is involved in the synthesis of DNA sequences.

State law does not require the development authority to reveal how much in tax credits is given. A taxpayer can receive no more than $50,000 in credits a year. The authority said it approved credits for Zitter of more than $1 but not more than $50,000.

Agreed to allow Blue Sky Brands Inc. of Martinsburg to change how it uses a loan previously approved by the authority. The company had planned to use the loan proceeds to move a call center. It will now use the proceeds to buy racks and conveyor systems, Warner said.

Agreed to extend previously approved loan commitments to Tech-Seal Products Inc. of Wheeling; Mountain State Log Homes Inc. of Ireland, W.Va.; The K Group Limited Liability Co. of Roanoke, Va.; and the Huntington Industrial Corp. for InfoCision Management Corp.

Agreed to extend its commitment to insure $3 million of a loan the First National Bank of Ronceverte has made to the Western Greenbrier Co-Generation Limited Liability Co. of Rainelle from April 30 to Aug. 31.

Acting as the West Virginia Certified Development Corp., the board members also extended two $300,000 loan commitments to Western Greenbrier Co-Generation to Aug. 31.

Western Greenbrier Co-Generation is planning to build a $215 million power plant in Rainelle.