After months of speculation and a year of work, Silgan appears to be moving forward with an estimated $38 million investment in a Fort Smith manufacturing facility expected to create 150 new jobs by year three of operation.
On Monday (Jan. 22), Fort Smith’s weekly building permit report showed a $100 permit issued to Silgan Plastic Food Containers Corporation for “sub-work/new construction” at 7101 Highway 45 in Fort Smith, near the site that had been rumored in November to be the location for a future manufacturing facility. Also, the Sebastian County Assessor’s office shows a Jan. 18 deed filing in which Silgan acquired the property from Stephens Production for $712,000.
Silgan PFC — who counts Nestlé, ConAgra, General Mills, and Campbell Soup among its clientele — is considered one of the major players in the global food container market that was estimated at $231.91 billion in 2015 by Grand View Research. The market is expected to hit $346.99 billion by 2025.
Representatives from Silgan as well as the three entities that worked on attracting Silgan to Arkansas — Fort Smith Regional Chamber of Commerce President and CEO Tim Allen, the Arkansas Economic Development Commission (AEDC), and the city of Fort Smith— have not responded to inquiries from Talk Business & Politics at the time of this post.
At a meeting Nov. 20, 2017, the Fort Smith Board of Directors voted to adopt two resolutions — one to endorse Silgan’s participation into the Tax Back Program authorized by Section 15-4-2706(d) of the Consolidated Incentive Act of 2003; the other, a resolution of intent for the issuance of industrial revenue bonds (IRBs) to assist with the financing of an industrial facility to be located within the city.
At the time, Allen said landing Silgan PFC would be a nice “Christmas present,” but told Board members he expected to know for sure by the end of January (2018). At the November meeting, it was stated that winning Silgan PFC’s business would result in 150 new jobs by the facility’s third year of operation, and the site would take approximately one year to build.
Fort Smith City Administrator Carl Geffken confirmed to Talk Business & Politics the jobs paid on average $21 per hour, though he was unsure whether that meant straight salary or salary-plus-benefits. Fort Smith Deputy City Administrator Jeff Dingman said the company was eyeing a new piece of land for an entirely new facility located within the city limits in the vicinity of Rheem Manufacturing.
Also at the November meeting, Allen could not confirm any details per the terms of his nondisclosure agreement with Silgan. He did say in November the IRB portion of what the city voted to approve would result in a 50% property tax abatement to the city’s General Fund of around $75,000-$80,000 (or $7,500-$8,500 annually over a 10-year period).
The Tax Back Program incentive would be for an estimated $12 million to $15 million of all eligible purchases, provided those purchases are made within Fort Smith city limits. The $12 million to $15 million figure assumes a $38 million expansion.
Silgan could help the Fort Smith regional manufacturing sector continue to stabilize and grow. There were 160,500 manufacturing jobs in the region in November, according to the U.S. Bureau of Labor Statistics. The November employment was almost 5,000 jobs more than the 155,800 in November 2017, but well below peak sector employment of 247,300 in February 1995.
However, the sector in 2017 began to see consistent growth. Sector employment fell below 160,000 in May 2011, but in October 2017 again rose above the mark to 160,800.