School Board Approves Property Tax Increase, Tax Break For Medical Isotope Plant

Article written by: Ethan Weston AND Javkhlan Bold-Erdene
Publication - Missourian
Date Posted - Sept. 18, 2018
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The school district’s property tax levy will rise by 9 cents later this month after the Columbia School Board voted to reverse a voluntary levy reduction on Monday.

The board also approved a contract with River City Construction for the new southwest middle school and voted to support a request by Northwest Medical Isotopes for a $5.6 million property tax break on the plant it plans to begin building in southeast Columbia. According to the project schedule, construction will begin later this year and should end in 2020.

The property tax increase approved Monday night will cost the owner of a $200,000 home an extra $34.20 a year. It would boost the district’s total levy from $6.0555 to $6.1455.

The increase will take effect Aug. 23 and will generate an estimated $2.22 million in additional revenue this year.

In 2016, residents voted to allow the school district to raise the property tax levy by 65 cents, but the district chose at the time to raise it by only 56 cents. Monday night’s vote implements the other 9 cents that voters approved.

“It is very important to help finance our compensation for our teachers and the general operation of the school district,” said Jan Mees, president of the Columbia School Board. “We have increasing needs, and this money is very important.”

The district also approved a bid by River City Construction of Ashland to build a new middle school in southwest Columbia. The board received eight bids altogether, and River City’s was lowest at $22.65 million. The highest bid of $24.62 million came from Little Dixie Construction.

The new middle school was approved in March and will be built near Sinclair Road.

The board also voted to advance a request by Northwest Medical Isotopes to receive a Chapter 100 property tax reduction of 50 percent for 10 years.

The U.S. Nuclear Regulatory Commission granted the company a permit in May to build a radioactive isotope production facility at Discovery Ridge Research Park in southeast Columbia.

The city is a logical home for the facility; it will be working with the MU Research Reactor to develop an isotope called Molybdenum-99, according to previous Missourian reporting. The isotope is used in the diagnoses of cancer and other diseases. Mo-99 isn’t produced anywhere in the U.S., even though the country is the largest market for the isotope, according to previous Missourian reporting.

The company expects to create 104 jobs that would pay an average of $35 per hour. Its plant and equipment will be worth an estimated $108 million, which means the school district would get an additional $5.64 million in revenue per year, even with the abatement.

Representatives of Regional Economic Development Inc. have been making presentations to various taxing entities about Northwest’s request for Chapter 100 assistance.

Bernie Andrews, the nonprofit’s executive vice president, attended Monday night’s school board meeting.

“It is very important to this project because the Columbia Public Schools will be a main recipient of the real and personal property taxes from the project,” Andrews said in an interview with the Missourian. “So, it is very important to have their support to move forward to take this to the county commission.”

REDI will meet with the Columbia City Council next week. The Chapter 100 Review Panel, which includes representatives of each taxing district, will meet soon to recommend whether the Boone County Commission, which has the final say, should approve the tax incentives.

Boone County Commission advances Chapter 100 request for Northwest Medical Isotopes

Article written by: Roger McKinney
Publication - Columbia Daily Tribune
Date Posted - Sept. 18, 2018
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The Boone County Commission on Tuesday advanced the tax abatement application of Northwest Medical Isotopes for its planned $108 million medical radioisotope production plant in Columbia.

The Commission will give final consideration Thursday for the application for Chapter 100 bond financing in a meeting that starts at 1:30 p.m. in the commission chambers of the Boone County Government Center.

The production facility is planned for 7.4 acres in the Discovery Ridge Research Park. In its application, the company stated it plans to create 104 new jobs at an average pay of $35 an hour.

“These jobs are almost twice the average county wage,” said Dave Griggs, chairman of the Regional Economic Development Inc. incentives committee.

According to the employment breakdown in the application, there would be 32 technical support workers making an average of $70,000 annually; 52 production workers making $55,000; eight in production support making $35,000; eight in administrative support at $30,000; and four managers making an average of $85,000.

Carolyn Haas, chief operating officer of Northwest Medical Isotopes, presented the project to the commissioners. She said the number of employees will increase beyond 104 in the first several years of production.

Chapter 100 industrial bonds allow cities or counties to purchase or pay for projects with bond proceeds and then lease or sell the project back to the company. The lease payments are used to retire the bonds. The company receives a tax break on the property during the lease period.

Northwest is requesting a 50 percent property tax abatement from Boone County and its taxing districts. The abatement will be in place for 10 years on the building and for three years, five years or seven years on equipment, depending on the depreciation schedule. During the 10 years, Columbia Public Schools will receive new property tax revenue of $1.275 million. Other entities receiving new funds include Boone County, $25,240; Columbia, $86,324; the Daniel Boone Regional Library District, $65,117; and Boone County Family Resources, $24,195.

The Chapter 100 Taxing District review panel, with a representative from each taxing district, voted last monthto recommend that the commission approve the tax abatement.

Northwest Medical Isotopes will produce molybdenum-99 and technetium-99m, used in medical scans for heart disease, cancer and bone and kidney disease. The isotopes decay quickly, so they can’t be stored and need to produced continuously. The isotopes haven’t been produced in the U.S. since the 1980s.

The company plans to start full construction in 2019, with commercial operations starting in the first quarter in 2021.

Haas provided the commissioners with a caveat regarding the schedule.

“Unfortunately I have no control over the NRC,” Haas said, referring to the Nuclear Regulatory Commission, which must still approve an operating license. She said the process can take 18 months to two years.

“It’s a very set process, very arduous,” Haas said.

The NRC has already approved the company’s construction permit.

Haas explained that the plant will receive uranium from the U.S. Department of Energy and Northwest will produce material which will be irradiated at the University of Missouri Research Reactor. Then it would be transported back to the Columbia plant to produce a product that can be shipped to a nuclear pharmacy and then on to hospitals. She said each step is secure and well-documented.

She said the company is based in Oregon, but 99 percent of employees will be here in Columbia.

Ralph Butler, senior adviser to the company, has said at a previous meeting that the plant will produce some radioactive waste, but there would be no long-term storage on-site.


School Board Votes to Support Tax-Break Request

Article written by: Roger McKinney
Publication - Columbia Daily Tribune
Date Posted - Aug 13, 2018
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The Columbia Board of Education on Monday voted to direct President Jan Mees to vote in favor of a tax abatement for Northwest Medical Isotopes when it comes before the Chapter 100 Review Panel.

Board member Teresa Maledy recused herself from the vote because she is on the board of Regional Economic Development Inc. All six of the other board members voted “yes.”

Mees is the board’s representative to the Chapter 100 panel, which will make a recommendation to the Boone County Commission. The vote came after a presentation by Carolyn Haas, chief operating officer with Northwest Medical Isotopes and Dave Griggs, chairman of the Redi Incentives Committee.

“I use the word ‘tranformational’ for this project,” Griggs said. “This project can put Columbia, Missouri, on the map.”

Northwest is seeking a 50 percent tax abatement for 10 years using Chapter 100 bonds for its $108 million radioisotope production facility in the Discovery Ridge Research Park. The company anticipates creation of 104 new jobs with an average wage of $35 an hour. The plant will make isotopes molybdenum-99 and technetium-99m, used in medical scans for cancer, heart disease, and bone and kidney disease. Because of their short half-lives, the isotopes can’t be stockpiled and must be routinely be produced for use by hospitals. There has been no domestic production since the late 1980s.

“If there’s any upset in the supply chain, guess what?” Haas said. “We don’t get cardiac images anymore.”

The company plans to start construction in the fourth quarter of this year and begin commercial operations in the first quarter of 2021.

Haas said approval of the construction permit by the Nuclear Regulatory Commission in May was a big hurdle to overcome.

“We had to prove that what we were going to do is safe for everyone,” she said.

She said the process would produce nuclear waste, which would be stored on-site for about seven months before being transported to a storage location in Texas.

She said having the research reactor at the University of Missouri and MU’s Discovery Ridge Research Park were key to the company’s decision to locate here.

“This community has a ready work force,” Haas said. “It has a reactor and an engineering department.”

Haas said employees won’t necessarily need a bachelor’s degree.

“You’ve really got to have that basic math, science, technology background,” Haas said.

She said the facility will produce eight ounces of liquid per week, for use in 50,000 diagnostic images. An operating permit from the Nuclear Regulatory Commission is still needed.

Chapter 100 industrial bonds are an economic development tool used by cities and counties to purchase or pay for projects with bond proceeds and lease or sell the project to a company. During the lease period, the company receives a tax break on the property.

With the 50 percent abatement, Columbia Public Schools would receive property tax revenues of $5.6 million over the 10 years.

“This is not only good for Columbia, it’s good for the state and great for the nation,” said Superintendent Peter Stiepleman.”

The library board and the Columbia City Council also will give directions to their respective representatives to the Chapter 100 board. The Boone County Commission makes the final decision based on the recommendation of the Chapter 100 board.

The school board also voted to approve a bid of $22,645,500 to build the new middle school in southwest Columbia. River City Construction, of Ashland, had the winning bid. The contract requires the project to be complete by May 1, 2020.

The school board voted to approve a resolution to increase the district’s operating levy by 65 cents as authorized by voters in April 2016. Since the election, the district has increased the operating levy 56 cents per $100 of assessed valuation, withholding the additional 9 cents until it was needed. The increase will be used to fund pay increases for all employees and steps toward a model salary schedule for teachers.

The district’s total property tax rate is currently $6.0555 per $100 of assessed valuation.

The tax rate hearing is set for Aug. 23.

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