Charleston Stamping & Manufacturing Inc., the company that took over the idled auto body stamping plant in South Charleston last year, is getting a lower interest rate on its $15 million financing deal with the state.
Last May Gov. Joe Manchin announced the state was committing $15 million to bring the stamping plant back to life. Cleveland financier Ray Park, the plant's owner, is investing $20 million.
In April 2007, Charleston Stamping bought robots for its press lines. The West Virginia Economic Development Authority, the state's financing agency, then bought the equipment from Charleston Stamping for $15 million and is leasing it back to the company over 23 years. The arrangement means Ray Park, who owns the plant, won't have to pay property tax on the equipment.
David Warner, executive director of the development authority, said that when the deal was done, Charleston Stamping was paying 5.24 percent interest on the lease. "Since Treasury bills have dropped over the last 14 months, they asked if we would match the reduction in T-bill rates," Warner said. "Our board felt that was fair and that it was still a sound lease decision, so they approved it."
The new interest rate, 4.73 percent, was approved by the authority's board of directors during its meeting last week.
A rate decrease of just over a half-percent doesn't seem like much, but it mounts up over the years when it's the principal is large. Park was scheduled to make payments totaling about $25.8 million under the old rate. His total payments under the new rate will be about $24.6 million.
Photos of the robotic press lines are posted on the Web site at www.charlestonstamping.com. People who have seen the interior of the plant say it is impressive.
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Charleston Stamping & Manufacturing Inc., the company that took over the idled auto body stamping plant in South Charleston last year, is getting a lower interest rate on its $15 million financing deal with the state.
Last May Gov. Joe Manchin announced the state was committing $15 million to bring the stamping plant back to life. Cleveland financier Ray Park, the plant's owner, is investing $20 million.
In April 2007, Charleston Stamping bought robots for its press lines. The West Virginia Economic Development Authority, the state's financing agency, then bought the equipment from Charleston Stamping for $15 million and is leasing it back to the company over 23 years. The arrangement means Ray Park, who owns the plant, won't have to pay property tax on the equipment.
David Warner, executive director of the development authority, said that when the deal was done, Charleston Stamping was paying 5.24 percent interest on the lease. "Since Treasury bills have dropped over the last 14 months, they asked if we would match the reduction in T-bill rates," Warner said. "Our board felt that was fair and that it was still a sound lease decision, so they approved it."
The new interest rate, 4.73 percent, was approved by the authority's board of directors during its meeting last week.
A rate decrease of just over a half-percent doesn't seem like much, but it mounts up over the years when it's the principal is large. Park was scheduled to make payments totaling about $25.8 million under the old rate. His total payments under the new rate will be about $24.6 million.
Photos of the robotic press lines are posted on the Web site at www.charlestonstamping.com. People who have seen the interior of the plant say it is impressive.
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Matt Ballard, the Charleston Area Alliance's president and chief executive officer, said Tuesday that every year the Richmond, Ky., chamber of commerce visits another community to get ideas. "They've been to some big cities," Ballard said. "This year they chose Charleston."
A delegation from Richmond, here on a reconnaissance visit, saw the Clay Center, Appalachian Power Park and some other highlights. "They were oohing and aahing," Ballard said. "They were very impressed."
"They'll bring 40 to 50 people to stay two nights in October," Ballard said. "They'll tour some of the area's assets, learn how we built the Capitol Market and the Clay Center, and learn how this organization merged."
The Charleston Area Alliance was created in 2004 when the Charleston Chamber of Commerce, the Charleston Renaissance Commission and the Business and Industrial Development Corp., known as BIDCO, merged.
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Mike Aeiker, the Charleston Area Alliance's vice president of real estate, reported Tuesday that the Alliance's building, at 1116 Smith St., has a new roof.
Aeiker said work is underway on the front of the building to fix loose bricks and repair concrete. "The painting process will follow that, hopefully in three to four weeks," he said.
Contact writer George Hohmann at busin...@dailymail.com or 348-4836.
