General aviation manufacturer to build aircraft factory in Wisconsin

Kestrel Aircraft, the newest venture of GA veteran Alan Klapmeier, had selected a factory site in Wisconsin, turning down a previously near-certain location in Maine.

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Although the aircraft manufacturer, at HPC press time, had yet to issue an official press release, local and aircraft-industry press outlets were alight with news that general aviation (GA) startup Kestrel Aircraft, the newest venture of GA veteran Alan Klapmeier, had selected a factory site in Wisconsin, turning down a previously near-certain location in Maine. The Portland (Maine) Press Herald reported on Jan. 17 that Kestrel, which plans to build a composites-intensive single-engine turboprop plane, will build its manufacturing plant in Superior, Wis., after Maine officials failed to secure adequate financing for the company. Kestrel had announced in 2010 that it would move to Brunswick Landing, Maine, and employ as many as 600 workers to build the new type of six- to eight-passenger turboprop (see photo). According to the report, the state of Wisconsin developed a more attractive plan to provide federal tax credits for the $100 million (USD) manufacturing facility.

Klapmeier, Kestrel’s CEO and chairman, commented that some Maine officials failed to follow through on a financing plan that he thought was in place in 2010. The Portland Press Herald quoted Klapmeier in a Jan. 13 report: “We did not say, ‘Tell us your best offer and we’ll go and play it against someone else.’” Klapmeier also was said to insist that the company wasn’t interested in trying to “take a bunch of money from people and then go and take a bunch of money from someone else.”

According to the Jan. 17 report, Maine Gov. Paul LePage announced on Jan. 13 a total of $7.75 million in possible loan guarantees to bridge a financing gap. In contrast, Wisconsin proposed financing that involves the federal New Markets Tax Credit Program. The Wisconsin Housing and Economic Development Authority will provide $30 million in tax credit allocations immediately, a second allocation of $30 million by the end of this year and a commitment for a third allocation of $30 million in 2013 if the authority has the funds available, Klapmeier said. By contrast, the company received a $20 million tax credit allocation in Maine, and the status of future allocations was unclear.

The report says Kestrel plans to keep 25 engineering support and aircraft modification jobs in Brunswick and then add functions. Another published report, in the Minneapolis/St. Paul Business Journal, dated Jan. 16, said Kestrel was able to procure land in Superior’s former fairgrounds, for $500,000. According to a second story, the Wisconsin Economic Development Corp. will create an “enterprise zone” in Superior to enable the tax credits. 

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