When the city of Nampa rolled out its plan to bring food processing company Materne to town, it labeled its PowerPoint presentation announcing the arrangement “Project Squeeze.”
With the amount of cash being handed over to Materne in the agreement, another thing being squeezed, besides the company’s fruit snack pouches, is taxpayers’ wallets. Among the concessions given to Materne are forgiveness of property taxes, infrastructure upgrades, worker training and a waiver of building permit fees.
The company, founded in 2008, will eventually bring 237 jobs to the city in a new $85 million plant. The company will reside, after extensive renovation, in an abandoned Micron facility in Nampa.
The new jobs, which will average $16.55 an hour, according to the city, come at a cost for taxpayers. For examples:
- Megan Ronk, communications director for the Idaho Department of Commerce, told IdahoReporter.com that the state will pitch in $350,000 for infrastructure upgrades around the new facility. That money comes from the Idaho Opportunity Fund, which the Legislature bolstered last year in an effort to draw more businesses to the Gem State.
- The Idaho Department of Labor will pitch in $900,000 for worker training, with that money coming from the Workforce Development Training Fund.
- The corporate subsidies don’t end there, though. Canyon County will give the company a five-year pass on its property taxes, a gift one county official said could be substantial.
- Nampa, too, jumped in on the action, waiving permitting fees for the company, which one city official with knowledge of the deal said could be in excess of $100,000.
There are strings attached to the money granted by the state, including mandated minimum pay levels and specific health benefit requirements.
Gov. Butch Otter and a host of other officials lauded the deal, celebrating their efforts to draw the company to Nampa. “On behalf of the State of Idaho, I'm proud to welcome Materne North America to the Treasure Valley," Otter said in a prepared statement. "Idaho is becoming a national leader in food processing, and we are thrilled to welcome a new employer with such a stellar reputation to our state.”
Idaho has drawn a number of food businesses to the state in the past few years including Yogurt giant Chobani and energy bar maker Clif Bar to Twin Falls, with the assistance of taxpayer subsidies and grants. Rupert used subsidies to draw Frulact, a player in the fruit processing industry, to the city last year.
While many officials see food processing as an eternally stable industry for Idaho, that’s not entirely true.
Just last year, the H.J. Heinz company announced the closure of one of its facilities in Pocatello. The shuttering will cost at least 400 jobs in the region.
Taxpayers funded worker training for 454 Heinz employees to the tune of $880,000 between 2003 and 2013. Yet, when the plant officially closes sometime later this year, the taxpayer money will be out the window.
Several lawmakers, including Sen. Cliff Bayer, R-Boise, Senate Assistant Majority Leader Chuck Winder, R-Boise, state Reps. John Vande Woude, R-Nampa, and Paul Romrell, R-St. Anthony, have all suggested that the Idaho Legislature should investigate the worker training fund to ensure the program is meeting its goals and not wasting taxpayer cash.