In an attempt to prevent a major aerospace supplier from relocating out of California, the Long Beach City Council approved a state property tax sharing program to help Weber Metals, Inc. expand its operation and build a 60,000-ton hydraulic forging press that city officials said would be the largest in the United States.

 

The city council voted unanimously at its September 1 meeting to establish a citywide capital investment incentive program (CIIP), which was created by the state after the elimination of redevelopment and enterprise zones.

 

Like the city’s own sales tax incentive program, the CIIP establishes a property tax base required to be achieved by the property owner before an economic subsidy can be considered and in order for the property tax sharing to occur.

 

The base established in the CIIP is the sum of the existing property tax base, plus the ad valorem value of the next $150 million in investment.

 

Under the program, Weber Metals, Inc., which specializes in metal forging for the aerospace industry, would be able to receive 75 percent of the net property tax revenue above the base for a 15-year period, estimated to total $790,000, according to city staff.

 

The City of Long Beach would receive $2.8 million under the CIIP, which includes the remaining 25 percent of the net property tax revenue received above the base, $265,000, plus about $2.5 million in property tax revenue for the 15-year period.

 

The County of Los Angeles is also entering into a CIIP with Weber Metals, Inc. and plans to provide assistance of more than $1 million over 15 years while retaining $350,000 in tax revenue, according to city staff.

 

The company, which operates on a nearly 22-acre site in North Long Beach at 6976 Cherry Ave. that is partially located in the City of Paramount, is requesting the economic incentives to build a 60,000-ton hydraulic forging press complex to produce forgings of aluminum, titanium and nickel alloys for the commercial aerospace industry.

 

Michael Conway, director of Long Beach economic and property development, said Weber Metals’ parent company, German-based Otto Fuchs Company, has proposed relocating out of California, adding that without the incentives the company would be operating at a loss and would have to implement layoffs.

 

With the economic incentives, however, the estimated $295 million expansion is expected to allow the company to grow its workforce by about 86 employees by 2020 at full operation of the new forging press that Conway said would be the largest in the United States.