Company misses bond payment for new Moberly plant
Tuesday, September 13, 2011
Plans for an artificial sweetener plant in central Missouri that supporters have said could employ several hundred people appeared to be facing financial challenges after the company missed a bond payment earlier this month.
Mamtek U.S. Inc. plans to make the calorie-free sweetener sucralose in Moberly. The city issued more than $35 million in bonds to assist the project and the state offered more than $17 million that included tax credits, a community development block grant and job training assistance. The project also called for $8 million from private investors.
The Moberly Area Economic Development Corporation said in a statement provided Tuesday to The Associated Press that officials were notified that Mamtek did not make a payment due Sept. 1 for the bonds and that money in a reserve fund was used to pay bondholders. The development corporation said there is sufficient money in the reserve fund to make the next scheduled bond payment if that were necessary.
Moberly, the city’s Industrial Development Authority and the development corporation were discussing the financing situation with Mamtek and seeking a solution.
Peter Kravitz, president of Mamtek, said in a statement that the company has been talking to local officials about the missed payment and about attempts to resolve the situation. Kravitz declined to comment further.
The Missouri Department of Economic Development said the incentives offered by the state are performance-based and that nothing has gone to the company.
“Our responsibility to state taxpayers is to make sure that every company is going forward and creating the jobs they have pledged to create before they actually receive any state economic incentives,” department spokesman John Fougere said.
Moberly is about 30 miles north of Columbia and has a population of roughly 14,000 people.
Mamtek says sucralose can be used in dairy, baking, beverages and pharmaceuticals.
State records obtained this week by the AP through an open records request indicate that Mamtek planned to expand the plant in phases. Under the first phase, 50 jobs would be created initially with an additional 111 new jobs created one month later. Within two years, the plan calls for 312 new jobs to be created at the facility. The average starting wage for the new jobs is to be $35,000.
A state economic impact analysis for the project that was dated September 2010 estimated the development would boost general revenues by an average of $1.15 million per year and lead to an average of $31.7 million in new personal income each year.
The records also show that former Gov. Bob Holden sent a letter in March 2010 to a Mamtek leader indicating he hoped the plant could be a model for future initiatives between the Midwest U.S.-China Association that Chinese companies. Holden identified himself as the chairman of the Midwest U.S.-China Association. In another letter to the company leader also dated from March 2010, then-U.S. Sen. Kit Bond thanked the firm for considering Missouri and noted the state has tax credits and financing plans designed to entice successful businesses.
Gov. Jay Nixon traveled to Moberly last year to announce that Mamtek was planning a plant in central Missouri with a project that could eventually lead to 612 new jobs. Nixon said it promised a significant boost economic boost for the state and that he was pleased his administration could provide an incentives package for it.
“At a time when too many American companies are shuttering their plants and moving jobs overseas, we are thrilled to have a global company creating hundreds of good manufacturing jobs right here in Missouri,” Nixon said in July 2010 statement about the project.