“I’m proud of General Mills for thinking enough of our community to put more dollars into it,” said Hal Benedict, a member of the NEMO EDC during its Wednesday’s morning meeting.

With the announcements earlier this year that Buckhorn Rubber and Cosmoflex will be ceasing operations in Hannibal in the near future, America’s Hometown was due some good news on the employment front. It came Tuesday night when General Mills made public a planned $65 million expansion at its Hannibal plant.

“Obviously when we make a decision to invest in a site it and you’re going to put another $60 million to $70 million in that site it does secure (the plant’s future), at least for a period of time, because you’re not going to spend that kind of capital just to have to redeploy it somewhere else,” John Komor, site manager.

Understandably, local reaction to the news was upbeat.

“This is a tremendous re-investment in what is becoming almost their largest plant in North America,” said George Walley, executive director of the Northeast Missouri Economic Development Council (NEMO EDC), adding that talks with the company regarding the expansion project began in early November 2016.

“I’m proud of General Mills for thinking enough of our community to put more dollars into it,” said Hal Benedict, a member of the NEMO EDC during its Wednesday’s morning meeting.

“We’re excited for General Mills and more excited for the employees of General Mills because the agreement that’s been reached in the expansion of General Mills just solidifies their interest in this community and their long-term commitment to remain here in Hannibal,” said Mayor James Hark. “They believe in the people and workforce here and I think that’s demonstrated solely by their interest to re-invest. A $65 million investment is a pretty aggressive statement by that company to make.”

Unlike the expansion of the local General Mills plant in the early 2000s, when employment surged from around 400 to over 800 people, the long-term employment impact from the latest expansion is expected to be negligible.

“We’re projecting to stay pretty flat on employment,” said Komor, reporting that the plant currently has 920 employees. “We’re usually pretty conservative on that (employment estimates). I hope that number is higher. We’ll do everything in our power to make it that way.

“This plant has a history of no permanent layoffs, which is just fantastic, right? We’re bringing in new stuff so that no one ever does get laid off in the future.”

No coincidence

The fact the expansion was announced publicly at the City Council meeting was no coincidence. A key component of the expansion is the city’s willingness to authorize the issuance of approximately $65 million in Chapter 100 Industrial Revenue Bonds.

“In the state of Missouri it (Chapter 100 bonds) is the only way to provide tax abatement on personal property taxes. There’s no other way legally to give an incentive to a company by abating personal property taxes. This is the only tool that works,” explained Walley.

General Mills will receive a 50 percent abatement on real property taxes on new improvements for 10 years plus a personal property tax abatement of 50 percent on new equipment only for a decade.

Walley stressed that by authorizing the issuance of the bonds the Council has not put taxpayers at risk.

“There’s no costs or fees for the city. We’re simply abating the taxes,” he said. “If something goes wrong with the company, they’re the ones guaranteeing the bonds, no one else is. There’s no way it can come back on taxpayers.”

As part of its deal with the city, General Mills agreed to renew its lease of the city warehouse for 10 years. It agreed to participate in the Work Ready Communities Program. The company will also participate in an annual employment review that includes commuting information.

Hannibal’s soup line gain is a painful loss for a plant in Vineland, N.J., which will be closed. Ironically, Komor once worked at the New Jersey site, which was acquired by General Mills in 2001.

“It’s a sad day for me that at the end of this month they will be making their last case (of soup) and between 400 and 500 people will be looking for other employment,” he said.

Following decisions by Buckhorn Rubber and Cosmoflex to close, Hark knows what officials in New Jersey are feeling.

“It’s unfortunate another city in New Jersey has lost a soup line, but we’re happy they (General Mills) chose Hannibal to re-invest here,” he said.

Reach reporter Danny Henley at danny.henley@courierpost.com