State approves tax exemptions for eastern N.D. businesses

BISMARCK – Three eastern North Dakota businesses planning new projects and expansions should receive five-year tax breaks, state officials decided Monday.

Ideal Aerosmith of Grand Forks, Somahlution of Fargo and Phoenix International of Fargo applied to the state for five-year, 100 percent income tax exemptions for new or expanded business projects.

Phoenix International is looking to build a new 90,000-square-foot facility to help provide adequate space for product test equipment, engineers and manufacturing lines. The budget for the project is $22 million.

“Today we are constrained, space constrained, so that’s the reason for the new facility, and our growth is enough that we will continue to utilize the buildings that we have,” Kyle Oetker of Phoenix International told state officials.

The company engineers and manufactures electrical components designed for harsh environments for original equipment manufacturers. The new facility would allow the company to grow its product test capabilities and expand into the power electronics market, its state application said.

“Power electronics are those electronics that are used in hybrid-type vehicles,” Oetker said. “Our role is harsh, rugged environments, so we’re trying to make electronics to hybridize construction equipment, tractors, combines, off-road type vehicles.”

Phoenix International hopes to add 56 jobs by 2017 as a result of this expansion and requested a tax break worth an estimated $666,073. The company also applied for a property tax exemption with the city of Fargo.

Ideal Aerosmith develops and manufactures test solutions for several industries, including aerospace, marine, oil exploration and automotive. These test solutions are typically used during product development and for functionality verification of high-tech equipment, its state application said.

The company plans to add 20 jobs by 2014 and requested a tax break worth an estimated $63,454.

Somahlution is a biotechnology company developing products for transplant medicine. The technology is being developed and the products readied for testing. The company hopes to begin selling products in 2013, its state application said.

The company plans to add seven employees by 2015 and requested a tax break worth an estimated $12,635.

The State Board of Equalization – which includes the governor, tax commissioner and state treasurer – unanimously approved the three requests.

3 thoughts on “State approves tax exemptions for eastern N.D. businesses

  1. Will these companies have to pay the tax if they do not meet their hiring goals or if they go out of business or if they are sold to another company? Or is this typical corporate welfare?

  2. Pingback: “Project Cube” mystery solved « Florida Biotechnology News

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