CHEYENNE, Wyo. (AP) — The Wyoming State Loan and Investment Board approved $13 million in grants Thursday to help a Colorado producer of ammunition magazines for guns move its manufacturing operations to Wyoming.
The deal with Erie, Colo.-based Magpul Industries still needs approval from Gov. Matt Mead, but that is expected to be a formality because Mead was personally involved in recruiting the company.
Magpul is moving its production, distribution and shipping operations to Cheyenne and its headquarters to Texas, making good on its vow to leave Colorado after that state enacted gun control laws last year.
Magpul will bring about 90 new jobs to Cheyenne.
Jonathon Anderson, an attorney representing Magpul, said the company hopes to have a temporary operation in Cheyenne by late summer. The state grant money will help build a permanent facility that Magpul will move into when it is completed in several years.
Bob Jensen, CEO of the Wyoming Business Council, said the total local and state investment in bringing Magpul to Cheyenne is about $17 million. However, the eventual total return to the state and local community is expected to be about $20 million, Jensen said.
The deal approved by the State Loan and Investment Board, which is made up of the five statewide elected officials, including the governor, differs from the original proposal.
The original plan was for an $8 million grant and a $5 million loan, which would be paid back with interest.
Jensen told the board that state attorneys noted that a conflicting provision in state law appeared to disallow the loan from the particular economic development fund that was being tapped for the money.
To solve the issue, the Wyoming Business Council proposed a contingency clause that the state fund would receive at least $6 million back, the same amount that would have been returned for the original loan with interest.
Jensen said the arrangement had never been done before, but it was necessary for the state funding program to get a return on its investment in order to support future economic development projects.
Rep. Allen Jaggi, R-Lyman, was the only person to speak against the deal.
Jaggi said he had concerns about changing the package to all grant money and creating a competitive advantage for Magpul over other companies.
"Free enterprise is what I would like to do and the $17 million we're putting in, I just hope we get the returns that are expected," he said.
Jensen said the deal doesn't give Magpul a competitive advantage over other Wyoming companies because there are no other manufacturing companies on the same scale in the state.
In addition, he said Wyoming is being presented a unique opportunity because it highlights the state to other companies around the country facing similar issues as Magpul.
Randy Bruns, CEO of Cheyenne's economic development organization, said his organization is in contact with four other companies that are in similar situations as Magpul and possibly looking to move some of their operations.
He said they are considering Wyoming because of Magpul's decision to move to Cheyenne.
Bruns noted the move is costing Magpul millions of dollars.
The state board approved the deal on a voice vote, with state schools Superintendent Cindy Hill casting a lone no vote.