Texarkana OKs $250M Cooper Tire deal

Northwest Arkansas Democrat-Gazette - - BUSINESS & FARM -

TEXARKANA — Cooper Tire and Rub­ber Co. will get up to $250 mil­lion in fi­nanc­ing and a prop­erty tax break, the Texarkana Board of Di­rec­tors de­cided Mon­day.

At its reg­u­lar meet­ing, the board ap­proved is­su­ing in­dus­trial rev­enue bonds to fund im­prove­ments to Cooper’s Texarkana plant and agreed to a 65 per­cent re­duc­tion in prop­erty tax on any­thing bought with the bonds.

Cooper might not need all the bonds au­tho­rized, ac­cord­ing to the city’s bond coun­sel, Thomas Leggett of Lit­tle Rock law firm Fri­day, El­dredge & Clark.

“These bonds are not to ex­ceed $250 mil­lion, which means the com­pany would just draw down pe­ri­od­i­cally what it would take for cap­i­tal costs over a pe­riod of five years. And if it takes the full amount, then that’s what we’re go­ing to draw down. If not, it’s just what­ever the com­pany needs for the cap­i­tal costs,” he said.

The money will pay for cap­i­tal and equip­ment at the plant over about five years, said Cur­tis Sch­neek­loth, man­ager of Cooper’s Texarkana dis­tri­bu­tion cen­ter.

The deal will not cost any­thing to tax­pay­ers and the city will never be li­able to re­pay the bonds, Leggett said.

The city will is­sue the bonds on be­half of Cooper, which will be solely re­spon­si­ble for re­pay­ing them. The city will own ti­tle to any prop­erty bought with the bonds and lease it back to Cooper, with the com­pany’s lease pay­ments go­ing to­ward ser­vic­ing the bond debt. When the bonds are paid off, the ti­tle will trans­fer to Cooper.

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