Jan 9, 2008
By Bulletin STAFF. RTI International Metals Inc. will become Henry County’s largest taxpayer when it is up and operating, likely in mid-2010, officials said Tuesday.
The plant, which will be called RTI-Martinsville, is expected to generate a total of $2.1 million in revenue annually, including real estate taxes and tools and machinery taxes, and water and sewer services, according to Deputy County Administrator Tim Hall.
RTI International, which produces titanium mill products and fabricated metal components for the aerospace industry, on Tuesday announced its plans to open its 19th facility in the Patriot Centre industrial park.
It will create 150 jobs paying an average of $35,000 to $40,000 a year plus benefits, and make capital investments totaling $100 million over the next three years. Of that, $20 million will be spent on buildings and $80 million on machinery, according to Henry County Administrator Benny Summerlin.
The company will locate in the 79,480-square-foot shell building at the Patriot Centre with a 79,500-square-foot expansion planned for manufacturing and office operations. The expansion will house the titanium plate finishing operations, according to Rich Vandegrift, vice president of capital projects for RTI.
The company also will construct a second facility on a separate lot adjacent to the shell building, Hall said. Vandegrift said that building will handle the forging process of RTI’s operations in Martinsville.
There is no date to start operations, according to Dawne Hickton, vice chairman and CEO of RTI. The company will spend the next 15 to 18 months on construction and then will begin limited production to deal with quality and other aspects, she said.
It expects to be operating “full blast” by mid 2010, Vandegrift said. Hickton also said it expects to bring in some supervisors and quality control personnel but hire most employees locally.
RTI manufactures and distributes titanium and specialty mill products, extruded shapes, formed parts and engineered systems for aerospace, industrial, defense, energy, chemical and consumer applications for customers around the world.
The financially stable company views the move to Martinsville as “long term,” said Hickton.
RTI has more than $4 billion in contracts with Boeing, Airbus and the military that run through 2020, according to Hickton and the EDC. Several of those contracts were sealed last last year and, they said, sparked RTI’s need to expand.
Gov. Tim Kaine said RTI was ranked by Forbes magazine as the seventh fastest growing company in the United States. It employs 1,400 people in its combined operations in the United States, Europe, Asia and Canada.
This is the first completed revenue-sharing deal between Henry County and Martinsville. The two localities shared the cost of developing the Patriot Centre lots and will share — two-thirds county, one-third city — the revenues they produce.
In this case, when the county has recouped its investment in the company, it will share about $1.2 million with the city, according to Hall.
The incentive package for the project is complicated.
“Basically, we’re fronting the money for the grading and the building, but we’re getting it back” because RTI will not claim some enterprise zone rebates, Hall said.
Also offsetting the cost was a $500,000 anonymous donation to the EDC and a $200,000 contribution from another local company. Hall declined to identify the company. He said it met the required stipulations to collect Governor’s Opportunity Funds but had down-sized and did not feel it should keep the funds.
The county also used $100,000 that was not spent in the county’s current budget, and it added $2 million to a Tax Revenue Anticipation Note (TRAN) approved by county officials each year.
Originally used to fund debt incurred with 5-B’s, an embroidery firm that formerly operated in a county shell building, the TRAN debt had been paid down to $2.5 million, Hall said. With the addition of the $2 million, the county’s note now totals $4.5 million.
During negotiations, “both parties worked to make sure everybody got what they needed. It was extraordinary,” Hall said. “In all the (economic development) deals I’ve had a part in, these guys are as upfront and honest as anybody I’ve ever dealt with.”
RTI announced more than $78 million worth of expansion projects in 2006 at four locations as a result of gaining long-term aerospace contracts combined with the company’s future growth projections, according to a 2006 annual report.
New aerospace contracts are expected to generate $100 million to $150 million annually in product sales, according to the 2006 report.
The financial report for 2007 will show RTI had sales of $600 million in its two business groups: The Titanium Group and the Fabrication and Distribution Group, Hickton said.
