As part of the omnibus funding bill passed late Monday, the Legislature approved a $4 million loan to help build a $10.5 million jet-manufacturing plant for Cirrus Aircraft in Duluth.
“It was a big victory for us. We worked very hard on this one,” said Daniel Fanning, Duluth communications director.
Gov. Mark Dayton still needs to sign the measure. The funds will help the city of Duluth build a 62,000-square-foot office and manufacturing complex for Cirrus that is adjacent to its existing factory and finance office in Duluth.
The project is expected to generate 150 new manufacturing jobs at Cirrus, plus additional jobs at suppliers around the state, said Bill King, vice president of development for Cirrus. “We are excited about this,” he said. “There are some pretty cool things happening.”
Cirrus employs about 600 propeller-plane assemblers in Duluth, plus another 275 plane composite factory workers in Grand Forks. Construction could start in August and would take a year to complete.
The loan — which will be administered by the state Department of Employment and Economic Development’s Minnesota Investment Fund program — would cover building materials. Part of the loan would be forgiven if Cirrus satisfies employment and other goals set by the state, legislative leaders said.
The city of Duluth is contributing another $4 million, and Cirrus plans to spend $2.5 million on manufacturing and paint equipment, King said. The city will own the building and lease it to Cirrus for at least 15 years.
State Sen. David Tomassoni, DFL-Chisholm, said the plant could easily have ended up in China, where Cirrus’ parent company is based.
“If they are the good jobs that we expect them to be, this will have a regionwide impact,” Tomassoni said.
Cirrus is taking orders for the $2 million, seven-seat jets and has received some down payments. To date, Cirrus has built three of the jets and is awaiting approval from the Federal Aviation Administration, King said. Once the company gets the OK, full production can begin.
Cirrus is the only airplane manufacturer in Minnesota and currently makes a line of SR-20 and SR-22 propeller planes, with four seats.
The company recovered from a near collapse in 2008 and 2009. In 2011, Cirrus was purchased by China Aviation Industry General Aircraft Co.