Spirit AeroSystems will receive $280 million in industrial revenue bonds through the city to help finance building projects over the next five years.
The Wichita City Council voted unanimously to approve the bonds, which are issued by governments without any taxpayer liability. They provide financing for improvements at companies and often include tax breaks on the improvements.
Earl Martling, a machine operator at Spirit, told the council: “Give them some breaks so they can give people like me jobs.”
According to city documents, proceeds from the bonds would be used for construction, expansion and renovation of Spirit’s factory site on South Oliver.
Spirit plans to invest $825 million in new machinery and equipment, for a total investment of $1 billion, city documents said. It would also add 349 jobs with an average salary of more than $45,000.
“Many people think the recession is over, but we know Wichita is still coming out of that recession,” said council member Lavonta Williams.
“($280 million) is a big number folks. But with all that said, we’re looking at a 5.38 to one return on investment,” said Mayor Jeff Longwell. “People keep fretting about Boeing leaving, but the reality is a big portion of that is still here with Spirit.”
Spirit will receive a 10-year tax abatement on any improvements it makes to existing buildings or new buildings under the new IRB.
Martin Mork spoke to the council and said he had concerns about the tax abatements as part of the plan.
Spirit paid more than $11 million in property taxes in 2015. The company has 10,800 employees with a payroll of $960 million.