An $80 million state grant was approved by the Chattanooga Industrial Development Board on Tuesday to push ahead the Volkswagen assembly plant.
Another $70 million in state money is expected to come down soon as incentive money pledged by the state starts to flow to pay for site prep and infrastructure for the $1 billion project. The city and Hamilton County are to match the second grant with $20 million each.
Local governments have promised to reserve about 1,200 more acres at Enterprise South industrial park for eight years as a suitable location for any possible expansion the automaker might make.
VW plans to meet with minority companies interested in doing business with the automaker Thursday at the Convention Center.
“Things are continuing to progress,” said City Engineer Bill Payne.
The city and county have been working to prepare the 1,340-acre Enterprise South site since May when Chattanooga was a candidate for the auto plant.
After Chattanooga’s selection over two months ago, work intensified and there are over 200 people at the site daily.
The state money will reimburse local government for the work and pay for what they’re now doing to ready the site for VW to start construction of the plant in November.
City attorney Randy Nelson told panel members they needed to take action on the grant Tuesday. The county, to pay for the Enterprise South work, has used funds on which it typically draws interest to enable it to meet its budget needs, Mr. Nelson said.
Panel member Richard Ebersole asked if the city will draw interest on the money while it is waiting to be disbursed.
Daisy Madison, the city’s chief financial officer, said she didn’t know if it could keep the investment returns but would find out.
It’s estimated that Volkswagen will receive $577.4 million in government incentives. However, officials said personal income growth alone because of the plant and spinoff companies and jobs will equal $11.8 billion.
Volkswagen plans to hire 2,000 workers and create 150,000 vehicles annually when its begins production, slated to be by early 2011.
Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...