State board awards $13 million grant for Magpul facility

2014-02-07T06:00:00Z State board awards $13 million grant for Magpul facilityBy TOM DIXON Star-Tribune staff writer Casper Star-Tribune Online
February 07, 2014 6:00 am  • 

The State Loan and Investment Board on Thursday awarded a $13 million grant to Cheyenne LEADS to buy one facility and build another for firearms manufacturer Magpul.

“We watched the Colorado anti-gun legislation. Everyone and their mom saw this opportunity,” said Laramie County Board of Commissioners Vice Chairman Troy Thompson, a project backer. “With the publicity, it’s easy to see why the county is supporting this project.”

Magpul announced its intentions to move to Wyoming early this year. The Cheyenne economic development organization – Cheyenne LEADS – will use the loan to buy a 67,000-square-foot building to temporarily house Magpul while they build a 108,000-square-foot facility.

Some state representatives were not convinced giving private businesses grants was the right way to use state money.

“As we continually hand out this money, there are other public entities that are going without,” said Rep. Allen Jaggi, R-Uinta.

Wyoming Business Council CEO Bob Jensen emphasized the potential domino effect of bringing in Magpul, and the economic boost it will provide the state.

“At the end of the day this matches Wyoming culture and increases manufacturing and it’s building on an industry that’s important to our state and advances the rest of the people in business here already.”

The Wyoming Business Council recommended an $8 million grant and $5 million loan for the project at its December meeting, but a budget footnote “oversight” meant legally the funding could only come via grants.

In order to avoid making claims on money for the next two-year budget, which the Legislature has not approved yet, the Business Council had to do some maneuvering.

The Legislature provided the governor a $15 million pool of money for this two-year budget period. That money is supposed to be used for large infrastructure projects, like the two facilities planned for Magpul, at the governor’s discretion.

The Business Council often uses grant-loan packages to support infrastructure and job creation projects, but a footnote in the governor’s account left out the word loan.

“I’m just sad we’re in this position where we’re forced by legislative whim to have to do this,” State Treasurer Mark Gordon said.

The upshot is the State Loan and Investment Board gave Cheyenne LEADS $13 million in grant money out of that account, leaving the other $2 million, plus the $6.4 million left in the Business Council’s regular account – for two more projects considered Thursday.

The city of Cheyenne will get a $2 million grant and $3 million loan package to connect two rails and bring a California-based steel tubing manufacturer to the Swan Ranch Industrial Park south of Cheyenne.

The Swan Ranch Industrial Park is home to 13 businesses, including the Cheyenne Rail Hub, which moves crude oil. The rail connection will allow that business to expand, and Searing Industries’ 200,000-square-foot facility will be the largest rail in the region.

“There’s not many places where you have access to both rail lines,” State Auditor Cynthia Cloud said after the meeting. “That can really give Wyoming businesses a competitive advantage in their pricing and delivery method.”

That grant will consume the last of the governor’s account for this two-year budget. The loan will come from the Business Council’s regular pool of money.

There is still $900,000 left in the account after the Investment Board approved a $2.5 million loan for a Casper infrastructure project intended to support a luxury hotel and conference center and other development.

The Investment board consists of Gov. Matt Mead, Secretary of State Max Maxfield, Superintendent of Public Instruction Cindy Hill, Gordon and Cloud.

Contact Joshua Wolfson at 307-266-0582 or at josh.wolfson@trib.com. Visit http://trib.com/news/opinion/blogs/wolfjammies to read his blog. Follow him on Twitter @joshwolfson.

Copyright 2015 Casper Star-Tribune Online. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

(8) Comments

  1. Wyoite
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    Wyoite - February 07, 2014 6:54 pm
    Great project and well done. Hundreds of people from our State will benefit from this project. The majority of Wyomingites welcome these folks and are excited to see manufacturing jobs come to our State.

    Homerun for the WBC. Homerun!
  2. blue collar
    Report Abuse
    blue collar - February 07, 2014 5:02 pm
    Absolute Corporate welfare.
  3. dennydewclaw
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    dennydewclaw - February 07, 2014 10:47 am
    Sounds to me like the sun only rises and sets in Cheyenne when it comes to the public trough. Magpul & Swan Ranch are shoveled millions while Casper has to beg for pennies for a convention center. If I am not mistaken it was our legislator, the Honorable Bunky Loucks who contacted the Magpul people in the first place. I am reasonably sure his intent was to bring them to Casper. How did they end up in Cheyenne??? I wonder. Oh yea Cheyenne skims off the top.
  4. pappy
    Report Abuse
    pappy - February 07, 2014 8:33 am
    We are not allowed to lend the money to Magpul so we will have to just give it to them. Two weeks ago Mr. Gordon went to great length in an editorial to explain his decision for rejecting Casper's request for a loan ( now partially approved) for an infrastructure project to build a convention center because it would give the hotel an unfair competitive advantage. Now he gives this money to Magpul. I wonder if he has a mirror in his house. I'm betting Texas didn't offer this kind of deal. Maybe the State should have cut the grant in 1/2 or more and made Magpul come up with the rest. then we would be less likely to end up holding the bag. If they can't get the fianancing then they aren't a good risk.
  5. 99Savage
    Report Abuse
    99Savage - February 07, 2014 8:04 am
    This is just wrong. But don't blame Magpul. They are just doing what any company does that is looking to set up shop in another area. The fact that they all do it doesn't justify it. Blame your representatives and politicians.

    Government simply shouldn't be in the business of making loans and grants. Lending companies shouldn't be in government's business. There I go again, dreaming.
  6. Sassy
    Report Abuse
    Sassy - February 07, 2014 7:31 am
    Can anyone answer why Magpul is splitting their operation in two- operations in Wyoming and leadership in Texas?? This is not a cost effective business model.

    Dollars to donuts- Wyoming is left holding the $13million dollar building in the not so distant future..
  7. Sassy
    Report Abuse
    Sassy - February 07, 2014 6:38 am
    Cowboy-- I'm fairly sure you know all the answers- But just in case
    1. Never
    2. Dont fool yourself- their are many in the legislature that what like to take them away.
    3. No
    4. General Funds- Powered by taxes on the people.
  8. Cowboy Joe
    Report Abuse
    Cowboy Joe - February 07, 2014 6:23 am
    How often has a grant this size gone to private business? Did magpul benefit purely from our pro gun zeal? We're there other applicants? What was the source of the $13mil?
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