The Ohio Tax Credit Authority approved a tax incentive package Wednesday for Silfex, an Eaton-based firm that plans to create as many as 400 new jobs and invest $223 million in Springfield.
The state board approved a deal that’s expected to create $20.7 million in additional payroll as part a 12-year, about 2 percent credit on its Ohio employee payroll taxes. The company would be required to maintain operations in Springfield for at least 15 years to qualify for the incentives, according to public records obtained by the Springfield News-Sun.
Silfex officials declined to comment but issued a statement saying its expanding both at its Eaton headquarters and to a second location in Springfield in order to meet industry demand for silicon parts.
“This is an exciting time for Silfex and for the semiconductor industry as a whole … We look forward to becoming a part of the Springfield community,” the statement says.
Ohio officials estimated the value of the tax incentives at just shy of $5 million, if all requirements approved by the state tax credit authority are met. The actual value of the tax credit is based on the number of jobs created and new payroll tax generated, according to information from the Ohio Development Services Agency.
Silfex, formerly known as Bullen Semiconductor, is based in Eaton and provides silicon products for the solar, optical and semiconductor equipment markets. The project is expected to include a capital investment of about $223 million over the next five years, company officials said.
Few details about the deal — including where the new Silfex plant will be located in Springfield — were available on Wednesday. Springfield Mayor Warren Copeland declined to comment. Officials with the Chamber of Greater Springfield declined to elaborate on the agreement, but said the incentive package is an important step for the company.
“This is an important step toward finalizing Silfex expansion plans,” said Horton Hobbs, vice president of economic development for the Chamber of Greater Springfield. “We will continue to work with the company and our regional partners as we move forward with this project.”
Springfield city staff members also declined to provide further details about the agreement Wednesday, but said the jobs would provide a boost to Clark County’s economy. No tax incentive proposals have been submitted to the city, said Tom Franzen, Springfield’s economic development director and assistant city manager.
“At this point we can’t say too much about it,” Franzen said. “It was an important step obviously with Silfex getting approval from the state of Ohio. We are working with them and our regional economic development partners and hope to help move forward with the project. We are working with the company, with the Dayton Development Coalition and the chamber/CIC and trying to formulate support for the project here locally.”
Silfex headquarters is the world’s largest custom silicon-growing facility, according to the company’s web site, and provides services including prototyping and manufacturing of low-volume components and assemblies.
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The company’s local investment would include construction of a new building, on-site infrastructure improvements, and new machinery and equipment, according to documents provided by the state.
“The proposed project in the city of Springfield offers significant job creation with high wages in a key industry segment,” according to documents provided by the state. “Providing state support will help ensure continued growth for this Ohio based company.”
Records from the ODSA shows the state tax credit authority also approved a 1.32-percent, seven-year tax credit for the company in August 2016. In that case, the company pledged to create 109 full-time jobs and $5 million in new payroll by 2019 as part of the company’s expansion project in Eaton.
The company is required to maintain operations at that location for at least 10 years. The state says that deal hasn’t been finalized yet and Silfex isn’t receiving any tax credits for it right now.
“The company is one of the few advanced manufacturers of silicon chips in Ohio,” state documents from that proposal showed. “Ohio seeks to significantly increase its presence and capability in this sector. This project also supports Ohio’s IT and advanced manufacturing strategies.”
By the numbers:
400 — Jobs proposed
12 — Years included in agreement
$20.7 — Expected payroll
$223M — Anticipated capital investment