bg products, inc. industrial revenue bond letter of … presentations/2017-09-12...bg products, inc....
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BG Products, Inc.Industrial Revenue
Bond Letter of Intent Request
Office of Economic Development
September 12, 2017
BG Products
• BG Products formed 1971
• Manufacturer of lubrication and cleaning products for the
automotive industry
• Purchased former Sunflower Oil and Grease facility located at
701 & 740 S. Wichita in 1980s
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BG Products
• Invested heavily in research and development of new product
lines; refined existing lines as engines have become more
sophisticated
• Automotive products and services for fuel systems, engines,
transmissions, brakes, power steering, climate control systems
• Provides training to service advisors and technicians
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BG Products
• Current auto lab and R&D lab are old and inefficient
• During training session, auto lab shut down; R&D lab too small
to grow
• Classroom for training limits class size
• Intend to demolish two structures and replace with new 34,000
sf addition
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BG Products
• New, larger classroom
• Larger auto lab; dedicated demonstration room
• Offices for engineers; increased R&D lab space
• Larger breakroom space for training sessions
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BG Products12
Jobs Base New5 Year
Projected
Avg
SalaryCapital
2017 174 11 185 $70,200 $11,500,000
• 83% property tax abatement
• 5-plus 5 year basis
BG Products
• Value of one year 83% tax abatement ($10,500,000 at 80%)
• City $56,865 State $ 2,614
• County $51,232 USD 259 $93,569
TOTAL = $204,280
*In 2016, BG Products paid in excess of $72,000 property tax
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CEDBR Benefit/Cost Analysis: $12,000,000
Projected
City of Wichita 1.67 to 1
City of Wichita – Gen Fund 1.30 to 1
City of Wichita – Debt Srv Fund 1.53 to 1
Sedgwick County 1.31 to 1
USD 259 1.81 to 1
State of Kansas 3.70 to 1
BG Products
Recommendation:
It is recommended that the City Council close the public hearing, adopt the Resolution of Intent and authorize the necessary signatures.
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