Tuesday, January 28, 2003

Butler Co., N.Ky. vie for FedEx unit

By Jennifer Edwards
The Cincinnati Enquirer

WEST CHESTER TWP. - Northern Cincinnati suburbs are dueling with Northern Kentucky in the race to deliver a $50 million regional hub for FedEx Ground, which could bring 800 to 1,400 jobs with it.

The land-based subsidiary of rapid-freight company Federal Express has narrowed its search to locations in Butler and Boone counties, local government officials say.

FedEx Ground wants to build a 75-acre distribution center in the Tristate and is considering both a site along Port Union Road that straddles West Chester and Fairfield and a second one in unincorporated Boone County, according to correspondence to West Chester Township trustees obtained by the Enquirer and interviews Monday with Fairfield, West Chester and Kentucky officials.

"This is good news for everybody," Fairfield City Councilman Mark Scharringhausen said. "Anytime you bring in a company like Federal Express to the region, that is a draw for other companies."

While FedEx Ground officials were mum on details of the hub Monday, they did say the Tristate location would be decided and announced "shortly." The center is expected to break ground this year and open by 2006.

The company announced the project last fall as part of a $1.8 billion expansion of the Pittsburgh-based subsidiary, which is planning to create 10 new hubs over the next six yearsin such locations as Dallas and Hagerstown, Md., FedEx Ground spokesman David Westrick said.

FedEx Ground handles about 2.6 million packages a day, offering a lower-cost alternative to overnight air shipments, and takes packages up to 150 pounds, Mr. Westrick said.

The Tristate hub, dubbed "Project Rudy" in a recent e-mail to West Chester township trustees from the West Chester Community Improvement Corp. (CIC), will employ 800 full- and part-time workers after 10 years and, at full capacity, 1,400 workers. .

Entry-level jobs at the "highly automated, computer-driven distribution center" are $10.50 an hour, clerical work starts at $27,000 annually, mid-managers at $48,000 and managers at $68,000, states the e-mail, written by Melissa Koehler, the CIC's executive director.

FedEx Ground received preliminary approval Dec. 20 for $1.1 million in state tax incentives from Kentucky, according to Terri Bradshaw, spokeswoman for the Kentucky Cabinet for Economic Development.

Ms. Bradshaw said that is the maximum amount the company could receive once it is up and running.

On its application for the incentives, FedEx indicated it is considering building a 350,000-square-foot distribution center in Boone County. The exact location is not listed on the application, other than in unincorporated Boone County.

Ohio Department of Development spokeswoman Maria Smith said Monday the agency has yet to receive a tax incentive application from FedEx.

Officials in Butler County are hoping its Port Union location - near Interstates 275 and 75, about midway between Cincinnati and Dayton and in the booming southeastern Butler-Warren County area - will help draw FedEx Ground. But West Chester and Fairfield leaders are also considering entering into a special taxing district in addition to their own local tax incentives.

Fairfield would offer 100 percent exemption on real and personal property for 10 years, with 50 percent reimbursement to the school district, officials said.

By placing the property in its own joint economic development district (JEDD), West Chester and Fairfield can equally share a 1.5 percent earnings tax on project payroll, which initially is $20 million and increases as the facility becomes fully operational, according to the e-mail. Annual earnings tax revenues to the communities are projected to exceed $100,000 for each jurisdiction early in the project, according to the e-mail.

Under JEDD agreements, earnings taxes from commercial developments and businesses in a geographic area are set aside for road improvements and other infrastructure work in that area.

The specific location of the Butler County site for the FedEx hub is in a $275 million commercial park owned by Schumacher Dugan Construction Inc. The parcel sits midway between Seward Road and Ohio 747 on the north side of Port Union Road.

It would be the first major development with a tenant in the park, called Union Centre Commerce Park West.

Patrick Crowley contributed to this report. E-mail jedwards@enquirer.com

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