Gov. Nikki Haley signed a bill Tuesday giving Boeing Co. $120 million in state bond money for the next expansion of its 787 Dreamliner campus in North Charleston, The Post and Courier reported. Haley spokesman Rob Godfrey said she signed it in the afternoon.
Boeing announced two weeks ago that it would invest another $1 billion and create 2,000 jobs over eight years at the campus, which already employs more than 6,000 people, the newspaper reported.
The bond money will cover Boeing’s upfront costs of buying and improving land near Charleston International Airport, according to The Post and Courier. Amy Love, a spokeswoman for the S.C. Commerce Department, said earlier this month that the proceeds were expected to be used to acquire, mitigate and prepare land.
Phase two
Boeing confirmed its growth plans April 9, the day the bond bill was introduced in Columbia.
“We do intend to grow,” Jack Jones, vice president and general manager of Boeing South Carolina, said at an aerospace conference at Charleston Place that day, The Post and Courier reported.
“Since 2009, Boeing has invested more than $1 billion in land, facilities, infrastructure and tooling in South Carolina, and today we have more than 6,000 teammates working at the Boeing sites in the state,” Boeing South Carolina spokeswoman Candy Eslinger told The Associated Press, The Post and Courier reported.
Some of the work is already underway. Boeing has been expanding its aft fuselage and paint buildings since late last summer and this year began adding an operations center for its Dreamlifter cargo jets to the back of the mid-fuselage assembly building, The Post and Courier reported. The company also plans to concentrate its information technology work in North Charleston, which could account for about half of the promised jobs, and to buy another 320 acres at the airport, according to the newspaper.
“This is an expansion on a whole new level,” Haley said.
“I think what we’re seeing is a new phase of building airplanes in South Carolina,” she told The Post and Courier.
Through the Statehouse
House Speaker Bobby Harrell, R-Charleston, and Senate Finance Committee Chairman Hugh Leatherman, R-Florence, sponsored the bond bill. Leatherman helped write the 2009 legislation that brought Boeing’s 787 final assembly line to North Charleston.
“The takeaway is that Boeing is doing very well in South Carolina, and South Carolina is doing very well because of Boeing,” Harrell said, according to The Post and Courier. “So both of us want to expand its presence dramatically.”
Harrell said Boeing had exceeded its earlier commitments. “As it turned out, Boeing seriously under promised and over delivered,” he said.
The Senate gave the bill key second-reading approval April 10 by a 37-6 vote. Opponents, including Sens. Tom Davis, R-Beaufort, and Lee Bright, R-Roebuck, objected to the state taking on $120 million in debt, the newspaper reported. Davis also said the bill lacked details about the deal with Boeing.
“It seems to me that we’re putting the cart before the horse,” Davis said.
The bill passed the House last week, The Post and Courier reported.
The county’s share
On Tuesday evening, Charleston County Council’s Finance Committee added the expansion to the fee-in-lieu-of-taxes agreement Boeing signed with the county in 2009, according to The Post and Courier.
Under that deal, Boeing is assessed at 4% instead of the 10.5% industrial rate and gets half of that back through a special source revenue credit. The arrangement effectively lets the company pay less than a fifth of its normal tax bill on buildings, land and machinery over 30 years, the newspaper reported.
The expansion property will also be placed in a multicounty industrial park. That lets Boeing claim $2,500 in state job tax credits for each net new employee instead of the usual $1,500, Steve Dykes, Charleston County’s economic development director, told the newspaper.
Dykes confirmed that Boeing had begun some of the expansion projects before negotiating the latest deal, but said the state and county had to consider the company’s investments over the long term. “Obviously they can always do that back in Puget Sound,” he said, referring to Boeing’s longtime base around Seattle.
The committee also approved an $80 million bond issue, paid for with Boeing’s fees, to extend South Aviation Avenue over Ashley Phosphate Road to Palmetto Commerce Parkway, committee Chairman Elliott Summey said. The road would directly connect Boeing’s interiors factory with its main complex and could ease traffic in the area, according to the newspaper.
The full council approved both measures unanimously Tuesday night. They need two more votes to become law.
“All we did tonight was affirm our belief in them and thank Boeing for their belief in them,” Summey said of the local workforce.
Back in the air
The expansion comes as Boeing returns the 787 to service. The Federal Aviation Administration grounded the Dreamliner fleet in January after battery failures on two airplanes, and approved Boeing’s battery fixes Friday. A 787 parked on the North Charleston flight line made a two-hour flight over the Atlantic on Monday, the first South Carolina 787 flight in more than three months, The Post and Courier reported.
Harrell said earlier this month that the company was looking past the battery problem. “My goodness, Boeing is a company that thinks decades into the future, so the battery issue is something they’ll have to deal with, but they’re planning way beyond that right now,” he said.
