State officials approved a $30 million subsidy Tuesday that could help bring a Louisiana-Pacific siding plant to Hoyt Lakes on Minnesota’s Iron Range.

The state’s subsidy, approved by the Iron Range Resources and Rehabilitation Board (IRRRB), is targeted to help pay for site preparation expenses for the $400 million factory, should it be built in Minnesota.

The board of directors of the publicly held Louisiana-Pacific is scheduled to vote on the matter in July and again in February.

Four company officials attending Tuesday’s IRRRB meeting assured state officials that they are committed to seeing the new plant built in Minnesota, which has a massive inventory of aspen trees and a location with existing gas, rail and power that makes the prospective deal sweet.

IRRRB Commissioner Mark Phillips said that Louisiana-Pacific is also being wooed by Michigan and Canada, but that Minnesota stands a very good chance of ultimately winning the factory.

Louisiana-Pacific already has a siding plant in Two Harbors. The Hoyt Lakes factory under consideration, however, would be twice as large and promise up to 250 new factory jobs, plus another 300 or so “indirect” logging, trucking and retail jobs, Phillips said.

The chosen plant site is the Laskin Energy Park, which has about 800 acres of land and a power plant that was recently converted from coal to gas. The conversion reduced the need for workers at the site, so the prospect of introducing 250 new jobs for Louisiana-Pacific is enticing, Phillips said.

The state subsidy would only be used to prepare streets, roads, power and other public infrastructure needed for the plant to go forward.

“We are not financing any of the plant,” Phillips said.

State and local officials said they hope site-prep work could begin within the next six months.

If Louisiana-Pacific were to decide later not to build the plant in Hoyt Lakes, the company has agreed to reimburse Minnesota for any expenses connected with preparing the site. Contracts to that effect are now being drawn up, Phillips said.

However, if the siding plant does open in Minnesota, it would help diversify the economy of the volatile Iron Range, which has suffered 2,000 layoffs in the mining sector over the past year as global iron ore prices crumbled and the industry was hurt by underpriced steel imports from China, Korea and England.

Hoyt Lakes Mayor Mark Skelton said a new plant would be a shot in the arm for his region.

“The truth of the matter is we have been downtrodden ever since when we lost our LTV taconite facility and 1,400 jobs,” Skelton said.

Separately, the region lost about 2,000 workers to temporary layoffs during the past year as a result of the downturn in the iron ore and steel industry.

Skelton said some might bash the idea of a state subsidy for a siding plant, but “yesterday was a large step offering an incentive package that is no different than the state has done with other regions of the state.”

If the project goes through, it would be an “honor” for the community and also would help loggers, he said.

The $30 million subsidy approved by the IRRRB for the project could have been much larger and at one time was expected to exceed $60 million.

The state Legislature originally planned to approve several million dollars more in sales-tax exemptions for construction materials, but that bill waned in the final hours of the volatile legislative session.

Other incentives from the county and local cities could provide additional subsidies for the project over time, local officials said.

Separately, about $3 million in taxpayer incentives could materialize over 10 years depending on the production rates of the plant.