Business ventures and investments in any region are not only good for the economic development of that community, but also tend to highlight the positives that a city or state has to offer. Generally, before a business chooses to invest or expand operations in a region, several critical business issues, such as contract language, the cost of new facilities, loan programs, incentive programs and more are necessary to discuss.
Louisiana residents will be happy to learn that according to reports, as part of the second phase of a project which was initiated nearly a year ago, Gulf Coast Spinning Company is expected to invest nearly $130 million toward a brand new approximately 500,000 square feet cotton spinning facility in Bunkie, Louisiana. The construction of the new facility is expected to begin sometime in 2014 and the new facility is expected to create over 300 jobs by the year 2016.
Louisiana Economic Development stated that the first phase of the project involved the opening of a spinning facility in Lacassine, LA, which launched four years ago. The second phase involves the new Bunkie, LA facility. Upon completion of the new facility, the two spinning facilities will represent a total investment of nearly $150 million. Further, the facilities are expected to utilize nearly 15-20 percent of the state’s total cotton crop. Governor Bobby Jidal noted that the state of Louisiana’s agricultural resources, workforce, and investment in state-of-the-art facilities all add value to agribusiness investments.
As with every business venture and investment, business negotiations likely involve or revolve around an attractive deal that is beneficial for all involved. In this case, the State offered an incentive package that included part of a $2.4 million Economic Development Loan Program. Under this package, the loan amount will be forgiven if the two spinning facilities reach their expected payroll targets. Furthermore, the new Bunkie facility will benefit from the state’s Industrial Tax Exemption and Quality Jobs programs.
Such business transactions likely involve several important legal issues which may directly affect the prosperity of the business. Given the multimillion dollars of investment, it is important for all sides to receive competent legal advice regarding their business decisions.
Source: Area Development Online, “Gulf Coast Spinning Company Invests $130 Million In Bunkie, Louisiana, Cotton Spinning Facility,” Dec. 6, 2013