Joshua Haiar/South Dakota Searchlight
A South Dakota economic development board approved a $2.4 million sales tax rebate Wednesday for a weapons manufacturer’s expansion in Clear Lake.
The approval comes as state leaders are pushing to expand defense contractor presence in the state.
The South Dakota Board of Economic Development approved AMTEC Corp’s Reinvestment Payment Program application for the $2,434,648 rebate, to be paid as the company spends money in the state to facilitate its expansion. The payment is capped at 75% of the actual state sales and use tax paid on eligible project costs, with eligible costs not to exceed $113.6 million.
The state program allows companies to earn a rebate for upgrading equipment or constructing a new building in South Dakota. The program is limited to building projects over $20 million or equipment upgrades worth more than $2 million. Companies must meet certain expectations linked to jobs created, wages paid and the size of their physical footprint to qualify for the rebate.
The company recently announced plans to build a new medium-caliber ammunition production and test facility at the existing Tech Ord campus in Clear Lake, which is a division of AMTEC Corp. The project was described by National Presto Industries, of which AMTEC is a subsidiary, as a $90 million investment intended to meet U.S. Department of Defense ammunition needs.
“The investment further strengthens South Dakota’s growing role in supporting national defense and advanced manufacturing while reinforcing the Tech Ord campus as a strategic location for future Defense Industrial Base expansion,” a June 15 press release reads.
Tech Ord produces detonating and explosive components and materials. The company says its Clear Lake campus spans 640 acres and includes manufacturing, engineering and support operations, storage bunkers and hazardous-waste treatment infrastructure.
Gov. Larry Rhoden touted the Tech Ord expansion as part of South Dakota’s push to grow its national security industry in a June 19 column.
“They have over six decades of success strengthening our nation’s defense, and they continue to thrive here in South Dakota,” Rhoden wrote. “When their parent company was looking for a place to expand, they chose our state.”
In April, Rhoden announced a $6 million grant to start the South Dakota Defense Institute and a new Rapid City collaboration space intended to connect businesses, schools and government partners with federal defense agencies and contracting opportunities.
Tech Ord said media inquiries regarding the state funding must go through AMTEC’s Wisconsin office. That office declined to comment or put Searchlight in contact with their media relations staff.