Saturday, August 29, 2015

Army Saves Arkansas Taxpayers $87 Million

by Caleb Taylor, The Arkansas Project: The federal government actually did Arkansas state taxpayers a favor this week — when it decided not to award Lockheed Martin a federal contract to build Joint Light Tactical Vehicles in Camden.

From the Associated Press:
"Arkansas officials expressed disappointment Tuesday that a military vehicle assembly contract they had hoped to lure with an $87 million incentive package is going to another state.

"The Army announced that it is awarding the contract for the Joint Light Tactical Vehicle to Wisconsin-based Oshkosh Corp. The contract is valued at $6.75 billion. Lockheed Martin was among three companies competing for the project, which it intended to build at its Camden facility in southern Arkansas. Indiana-based AM General also competed for the project.

"The Arkansas Legislature in May approved issuing bonds if Lockheed won the project. Gov. Asa Hutchinson said he believed lawmakers did the right thing by approving the incentive package he proposed.'There is no doubt that we were competitive in terms of price, our workforce is second to none, and I remain very grateful for Lockheed Martin’s investment and confidence in our Camden facility,'the Republican governor said in a statement. That investment will pay off in the long term.

"State officials have said the project would have brought 600 new jobs to Arkansas. It would have been the second time the state issued bonds under a 2004 voter-approved constitutional amendment aimed at helping land major economic deals. Lawmakers two years ago approved $125 million in bonds for a steel mill under construction in east Arkansas."
As we’ve noted previously, state officials claimed this “economic development” project would bring 600 new jobs to the Camden area. If you divide the project cost of $87 million by the estimated 600 new jobs, that gives us a price tag of $145,000 in taxpayer dollars per new job from the project.

After the legislature almost unanimously passed a bill to give an $87 million handout to Lockheed Martin if our state’s plant was awarded the contract, we then found out that Lockheed Martin was going to build the project in Camden irrespective of whether they got the $87 million in state taxpayer dollars or not.

In other words, it was never really explained why Arkansas needed to give a major corporation like Lockheed Martin millions of dollars of taxpayer money. Luckily, taxpayers won’t be on the hook for the project, as the Army gave Wisconsin’s Oshkosh Corporation the contract.

Tags: crony capitalism, Lockheed Martin, United States Army, arkansas, taxpayers, saved $87 million, Caleb Taylor, The Arkansas Project  To share or post to your site, click on "Post Link". This site is an Outreach of the ARRA News Service.

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