Wednesday, January 11, 2012

Kestrel Aircraft Company: County panel approves land transfer for aircraft assembly plant

An aircraft manufacturing facility in Superior gained a nod of approval Tuesday from the Douglas County Land and Development Committee.

The committee voted unanimously to transfer property at the fairgrounds to the city’s Redevelopment Authority to facilitate a proposed manufacturing facility for Kestrel Aircraft Company.

“It’s an important step, but it’s a step in the process,” said Douglas County Board Chairman Doug Finn.

Kestrel intends to construct two facilities in Superior — one in the Winter Street Industrial Park now owned by the Redevelopment Authority, and the other on RACS-owned, city-owned airport property and county-owned fairgrounds.

According to the agreement approved by the committee, the county would transfer 13.3 acres of land at the northern portion of the county fairgrounds to the Redevelopment Authority, which would in turn, sell the property to Kestrel. The county would get $500,000 from the sale — $250,000 to be paid at closing, expected by March 31, 2013, and half to be paid by Kestrel with 3 percent interest by Dec. 31, 2014.

The county would retain access to the property, the multi-purpose building, curling club and parking through a license agreement before and during construction of aircraft manufacturing facility.

“This is an exciting opportunity for Douglas County and the city of Superior,” said Keith Allen, chairman of the Land and Development Committee. “We are fortunate to have county-owned land available that can be used to create 600 full-time jobs. The fairgrounds property is a logical site for an aircraft manufacturer.”

The site is adjacent to the Richard I. Bong Memorial Airport.

“This cooperation agreement is another example of the importance of partnerships when it comes to economic development,” Finn said.

Numerous business organizations including the Development Authority, the Chamber and Superior Business Improvement District have been involved in the effort to recruit the company run by former Cirrus founder Alan Klapmeier to the area.

With design operations in Duluth and office in Brunswick Maine., Kestrel Aircraft Co. plans to manufacture a single-engine turboprop, largely carbon fiber composite plane designed to carry up to eight passengers and a pilot, according to the business plan presented to the city.

But the fairgrounds site, which would become home to a 50,000 square foot assembly plant is only one of two facilities the company is planning to build, according to the development agreement that will be considered during a public hearing before the Redevelopment Authority on Monday.

Under the terms of that agreement Kestrel would first construct, beginning as early as June 1, a 35,000 square foot manufacturing facility in the Winter Street Industrial Park. That facility would be substantially complete by the end of the year.

Using the property at the fairgrounds for economic development is consistent with one of the recommendations developed in 2010 by the Head of the Lakes Fairgrounds Planning Committee, said County Administrator Andy Lisak.

“Allowing for the construction of an airplane assembly plant that will create 600 jobs (by 2016) is a higher and better use of the property,” Lisak said. “As we move forward with the project, it is important that we continue to communicate with the various stakeholders at the fairgrounds.” He said the groups were notified late last year of the potential for economic development at the site, and the county will work to mitigate any inconveniences the project may cause.

Fair and other activities will be able to continue at the site for the time being, and currently, the Superior Speedway is not part of the deal.

“This will revert back to the county if this unravels or doesn’t come to fruition,” said Superior’s Port and Planning Director Jason Serck.

The full county board will consider the Land and Development Committee’s recommendation when it meets Jan. 19.


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