Details on the $87 million for Lockheed Martin | Arkansas Blog

Thursday, May 21, 2015

Details on the $87 million for Lockheed Martin

Posted By on Thu, May 21, 2015 at 3:34 PM

J.R. Davis, the governor's press spokesman, provided me with some additional information on the $87 million state bond issue Gov. Asa Hutchinson wants to help Lockheed Martin expand a Camden facility to produce military vehicles, if it wins the federal contract.

Total Amendment 82 Bond amount: $87,145,000

Cash grant to the Company for qualifying building and infrastructure improvements, equipment, and other eligible costs incidental to the project: $83,000,000

Training grant to be used for construction and equipping of training facilities at Southern Arkansas University Tech: $1,645,000

Payment of the State’s bond issuance costs, debt service reserves, and other eligible financing costs incurred or paid by the State: $2,500,000

No other statutory or discretionary incentives are included.

This is a grant to Lockheed Martin.

Lockheed Martin, if awarded the contract, will enter into a 25-year commitment with the state of Arkansas. A detailed summary of the project and agreement will be released Friday. If the project falls through or if Lockheed Martin is not awarded the project, the deal is dead and Arkansas is off the hook for the money.

The payback of bonds for the state is dependent upon market conditions at that time. It will be somewhere between 15-20 years.

In other words, the state of Arkansas will sell bonds so as to give Lockheed Martin $83 million in return for a promise to hire employees. It will cost more than $83 million to pay back the bonds, because they will carry interest, depending on market when sold, for the 15- to 20-year repayment period.

A report is expected this week from a consultant on a cost-benefit analysis of the deal. I've requested a copy.

It's an $83 million handout from one of the country's poorest states — a state that just omitted the bottom 40 percent of its workers out of a $100 million income tax cut — to subsidize federal defense spending with a company whose annual revenue is nine times bigger than state general revenue annually ($45 billion to $5 billion).  Perhaps Sen. Jim Hendren could explain how this is the free market at work. Or maybe Sen. Tom Cotton, who likes to talk about welfare recipients who drive luxury SUVs to the grocery to pick up government-paid lobster and filets. I wonder if those SUVs have a Lockheed Martin logo on the side.

Tags: , ,

Sign up for the Daily Update email

Comments (17)

Showing 1-17 of 17

Add a comment

Subscribe to this thread:
Showing 1-17 of 17

Add a comment

More by Max Brantley

  • The line is open

    Here's the open line today. Lots of news today. Check it out on the daily video.
    • May 23, 2018
  • Making Change at Walmart blasts chances at annual meeting

    Making Change at Walmart, the group devoted to criticizing Walmart's labor practices, has blasted the company for planned changes in annual meeting procedures that it says will block workers from the business portion of the meeting and silence critical voices.
    • May 23, 2018
  • Jason Rapert responds to monument lawsuits

    Bro. Sen. Jason Rapert has responded in typical fiery fashion to the constitutional challenge of the 10 Commandments monument. His rights are under attack, he says.
    • May 23, 2018
  • More »

Readers also liked…

  • Arkansas: Land of .......

    Welcome to Arkansas: Land of cowardly politicians, discriminatory laws, inhumane turkey drops and lots and lots of Trump voters.
    • Oct 8, 2016
  • Use of solar on the rise in Arkansas

    With a pivotal ruling expected any day now from the Public Service Commission, Kyle Massey at Arkansas Business reports on the increase in Arkansans adding solar generation units on their homes and business.
    • Apr 13, 2018
  • UPDATE: Hutchinson moves to cover himself on cut to War Memorial Stadium

    Gov. Asa Hutchinson apparently felt the burn from KARK's exclusive Tuesday night on his plans to cut state support of War Memorial Stadium in half beginning July 1, 2018. He has a so-far secret plan to make the stadium self-sustaining. We bet that doesn't include state support.
    • Oct 20, 2016

Most Viewed

Most Recent Comments



© 2018 Arkansas Times | 201 East Markham, Suite 200, Little Rock, AR 72201
Powered by Foundation