Let me start out by saying a small news item that was less than 6 inches long, including the headline, made big news down at the Capitol in Little Rock recently.
The Big River Steel Mill in Osceola has repaid its $50 million loan to Arkansas.
Yes sir. Big River Steel paid back the $50 million loan and did so -- 17 years -- early.
Wow!
Back in 2013, during the 89th General Assembly, Gov. Mike Beebe, a Democrat, with a growing number of Republicans in both the state House and state Senate, hammered together a financial incentive package for a new up-state steel mill, just miles away from the state's premier and relatively new steel mill -- Nucor.
It was a risky deal, leveraging the state's credit out there for economic development.
Under what was then the recently approved Amendment 82, the state issued Big River Steel $125 million in bonds for the project. Local incentives also included $12 million from Mississippi County and $2 million from the City of Osceola.
It was a risky political move by Beebe and several of the solons in both chambers. It was the first time Amendment 82 was used on such a large project.
And it was the first time to directly oppose a politically powerful base of support by Nucor to cash-front this new and aggressive competitor.
The groundbreaking for Big River Steel took place Sept. 22, 2014. It would be a state-of-the-art mill and recycling facility worth $1.3 billion south of Osceola on the barren 1,400 acres off Arkansas Highway 198.
Big River Steel boasted it would produce steel for the automotive, oil and gas, and electrical energy industries and would hire more than 500 permanent workers. Among the dignitaries at the groundbreaking was Gov. Beebe and a handful of Arkansas lawmakers.
One solid and constant backer of the plan -- John Correnti, a former Nucor executive and now the hard driving president and front-man to Big River Steel, provided most of the political cover and enthusiasm for this addition to the state's growing steel mill corridor along the impoverished Mississippi River counties.
Correnti was more than just a cheerleader and politically connected individual. He has that charisma that makes projects happen.
After the bill had passed, the state loan made and the groundbreaking over -- a real tragedy struck -- Correnti died in a Chicago hotel room.
His death was less than a year from the groundbreaking ceremony at Big River Steel and caused everyone serious pauses.
Could the mill survive without his leadership? And would the loan ever be repaid?
There were more than just a few worried politicians and bean counters in the state's Finance and Administration section. And there was apparently reason to be worried.
Could this new company, an upstart rival to one of the world's largest steel mills and in direct competition -- just miles down the Mississippi River -- survive?
Would this new form of long-term loans of state money for private economic development survive this tragedy?
Would Big River Steel ever be able pay back the state?
Well, the company did pay back the loan. The state did receive all the funds it had pledged towards this economic project back in 2013, despite inherent grumbling about Beebe's heavy-handiness towards some doubtful legislators.
How was this fast-tracked pay back accomplished?
Big River Steel, after 10 months of operation, was able to obtain some $1.2 billion in financing, which was used in part to repay the loan from Arkansas.
Does this bipartisan plan of extending loans to manufacturers work?
At least in this case it did. Despite all the pitfalls that befell Big River Steel at the beginning.
The promises made by former Gov. Beebe and one steel guru, the late John Correnti, were fulfilled to the Arkansas taxpayers.
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Maylon Rice is a former journalist who worked for several northwest Arkansas publications. He can be reached via email at [email protected]. The opinions expressed are those of the author.
Editorial on 10/18/2017