Dow AgroSciences investing $14 million to expand sufoxaflor plants

Date:05-12-2011

Dow AgroSciences plans to expand one of its plants in Midland to meet a growing demand for the insecticide sulfoxaflor.

The company plans a $14 million expansion of the 827 Building within The Dow Chemical Co. Michigan Operations site. It received a tax incentive for the project from the City of Midland Monday night.

Earl Shipp, vice president of Michigan Operations for Dow Chemical, said construction could begin this year and be complete in July 2013, allowing the company to catch the second half of the growing season that year.

sulfoxaflor is an insecticide marketed for tree fruits, vines, vegetables, cotton, rice, cereals and soybeans in more than 50 countries. Shipp said it serves a niche of helping to increase productivity in existing fields by fighting aphids, whiteflies, plant bugs and thrips.

"It’s a product that works in multiple geographies and that’s why we’re here looking at an expansion,” Shipp said.

The project would add $13.1 million in personal property and $900,000 in real property while helping to retain six positions. It would involve about $8 million in labor and material costs, with most contracts being awarded locally, Shipp said. There would be a peak construction force of about 60 workers.

The tax incentive, an industrial facilities tax exemption, will reduce taxes over a period of 12 years. The project is expected to generate additional tax revenues of $318,063 for the city and $755,332 total for all tax authorities during the 12-year exemption period. If the project were to go forward without the incentive, it would generate $1,481,503 over the 12-year period.

Carol Miller, economic development manager with Midland Tomorrow, said the state’s tax structure is not conducive to investment, but offering incentives can help attract projects.

"Incentives continue to be vital for Michigan, specifically Midland, to compete for this investment,” Miller said.

Councilman J. Dee Brooks said people in the community have asked if it’s necessary to give the incentives.

"Especially when you look at the overall tax situation and structure here, we do need to do these things,” Brooks said. “They do increase the revenue, they bring employees, they bring construction jobs, more personal property in the tax base. I think it’s evident that if we don’t do these in an appropriate project like this, that businesses are going to look elsewhere.”

Another proposed tax incentive for Styron was withdrawn by the company prior to the meeting.